How Switching to an S-Corp Can Save Your Business Thousands in Taxes Get a Free Consultation: https://mycpacoach.com/contact/
In this video, I break down how gig workers, 1099 contractors, and small business owners can reduce self-employment tax by using the S-Corporation tax status.
You’ll learn what self-employment tax is, why it’s so expensive for business owners, and how an S-Corp can help you cap your Social Security and Medicare taxes by paying yourself a reasonable W-2 salary, while taking the rest as distributions.
I’ll walk you through the numbers step by step (including how the tax works in 2026), explain the biggest benefits of S-Corps, and cover what you need to know before electing S-Corp status, including salary rules, payroll requirements, and when switching actually makes sense.
As a licensed CPA who tax plans every day, I’m going to break this down step by step. Go ahead and save this video, hit the like button below, and let’s jump right in.
#scorp #taxstrategy #selfemploymenttax #cpatax
S-Corp Intro: (0:00) The Problem - Self-Employment Tax: (0:50) How S-Corps Limit Self-Employment Tax: (2:15) How Self-Employment Tax Works: (2:29) What is an S-Corp: (3:38) Tax Election: (4:09) Tax Benefits of an S-Corp: (4:52) Benefit #1: No Self-Employment Tax: (5:05) Benefit #2: W-2 Salary / Tax Reduction: (5:39) Benefit #3: Lower Audit Rates: (7:16) Benefit #4: More Tax Deductions: (7:31) W-2 Salary: (8:06) Reasonable Salary: (8:31) Additional Costs: (9:20) Tax Planning: (10:10)
/// Disclaimer: The information provided in this video is for informational purposes only and is not meant to take the place of professional legal, accounting, or financial advice. If you have any legal questions about this video or the subjects discussed, or any other legal matter, you should consult with an attorney or tax professional in your jurisdiction (i.e. where you live).
