It depends on numbers you have not run
Profit level, a defensible salary, your state and the added cost of payroll all move the answer. Change one and the recommendation flips.
Free 7-point checklist
Is an S corporation right for your practice?
For some practice owners the answer is a clear yes. For others the payroll and compliance costs eat the benefit entirely. This checklist gives you the seven things to weigh, so you can tell which one you are before you file anything.
Free, no card required
Created by Safietou D. Russell, CPA, EA, MST
Written for private and group Mental Health & Wellness Practices
Safietou walks through the checklist in a few minutes, watch before you download.
Why this keeps coming up
An S Corporation election should be evaluated using your practice's actual numbers.
The S corporation election is the most talked-about tax move in private practice and the most frequently made for the wrong reasons. It is genuinely powerful at the right profit level, and genuinely expensive at the wrong one.
The savings come with obligations
Payroll must run. A separate return gets filed. A salary must be documented. Elect without those in place and the savings turn into penalties.
One mistake attracts attention
S Corporation owners must follow payroll and reasonable compensation requirements. The checklist explains an important compliance issue to evaluate before making an election.
For practice owners ready to take action
You built your practice to help people, not to feel lost every March
If you are earning six figures and quietly wondering whether you are structured the right way, that question deserves a real answer rather than another year of putting it off.
The checklist gives you a clear starting point. When you want the answer rather than the framework, the next two steps below take you from "maybe" to a number.
What a well-timed election is meant to do
- Keep more of your income in the practice and in your household
- Reduce self-employment tax on the profit above a reasonable salary
- Spend your time and money on what actually matters, your clients and your life
Want to talk it through first? A consultation walks you through the key criteria and whether a full analysis is worth it for your practice.
Get the definitive answer: S Corp Strategy Report
A personalized S Corp Strategy Report starting at $2,497 modeling your practice under its current structure and as an S corporation, projected savings, real costs, a defensible salary range, state considerations and a recommended plan. The standalone Reasonable Compensation Report is $500.
Who put this together
Safietou D. Russell, CPA, EA, MST
Safietou D. Russell, or Safie for short, is the founder and CEO of SDR Consulting Inc., a virtual tax, accounting and advisory firm serving private and group Mental Health & Wellness Practices. She is a Certified Public Accountant, an Enrolled Agent and a Certified QuickBooks ProAdvisor, and she holds a Master of Science in Taxation from Florida Atlantic University.
She has been serving clients in tax and accounting since 2002, spent over fifteen years in public accounting before founding SDR in 2016, and the S corporation question is the one she is asked more than any other. This checklist is her answer to it, the version she gives before anyone has paid her anything.
Certified Public Accountant
Enrolled Agent
MS in Taxation
23+ years in tax & accounting
Read Safietou's full story
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Free 7-Point S Corporation Checklist
Enter your name and email and the checklist arrives in your inbox. No card, no call, no obligation to work with us afterwards.
- All seven points in full, with what to look at under each one.
- Written for private and group Mental Health & Wellness Practices, not adapted from a general small-business guide.
- Honest about the costs, not just the savings.
- Unsubscribe in one click. Your details are never sold or shared.
S corporation questions
The ones that come up every single time
How much does an S corporation actually save?
No, and anyone promising a number before seeing your figures is guessing. The saving comes from the portion of profit that stops being subject to self-employment tax once you pay yourself a reasonable salary. Whether that outweighs payroll costs, extra filings and state charges depends on your profit, your salary and where you practice. The checklist explains the mechanism so you can judge it; the S Corp Strategy Report gives you the figure for your own practice.
What is the biggest IRS red flag?
Paying yourself a salary that is unreasonably low in order to shift income into distributions. It is the most examined issue for small S corporations and it is entirely avoidable with a documented, defensible number. Our Reasonable Compensation Report exists specifically to produce that documentation.
Who is eligible to hold S corporation shares?
Shareholders must meet federal S corporation eligibility requirements, including not being treated as nonresident aliens for federal tax purposes, so our S corporation services carry the same requirement. If your status is uncertain for these purposes, raise it at the start rather than after an election has been filed.
Can I elect without changing my LLC?
In many cases yes. An S corporation is a tax election rather than a separate legal entity, so an LLC can often elect to be taxed as one while remaining an LLC in the eyes of your state. What changes is how you pay yourself and what you file, which is exactly why the decision deserves real analysis rather than a forum thread.
How is the checklist different from the paid analysis?
The checklist is free and educational. It tells you what to weigh. The S Corp Strategy Report, starting at $2,497, runs your actual numbers under both structures and returns a recommendation with a defensible salary range attached. One helps you ask the question properly; the other answers it.