Learning how to change LLC to S corp isn't about starting over—it's about layering smarter tax savings onto your existing business. Your LLC keeps protecting your assets while S Corp status slashes self-employment taxes, often saving thousands once business income is $80,000 or more. With Lettuce, the entire transition happens automatically—no paperwork, no stress, just streamlined savings.
Most solopreneurs think choosing a business structure is a permanent decision, but that’s not the case. Learning how to change LLC to S Corp isn’t about starting over; it’s about layering a smarter tax status on top of the LLC you already have.
Your LLC continues to protect your personal assets and give you business credibility, while the S Corp election adds tax savings that reduce your self-employment taxes. Instead of paying 15.3% on all your profits, you pay payroll taxes only on your reasonable salary and take the rest as tax-advantaged distributions.
With Lettuce, this shift is seamless. In minutes, you can elect S Corp status, automate payroll, and keep your compliance on track without the paperwork or confusion.
An LLC (Limited Liability Company) is a legal business structure. It protects your personal assets, like your home and savings, if your business faces debts or lawsuits, while giving you flexibility in how you operate.
An S Corporation (S Corp) isn’t a separate business type at all. It’s a tax classification you can elect with the IRS. Your LLC can keep its same structure and protections while being taxed as an S Corp.
This is where the two work together. Your LLC provides the liability shield, and the S Corp election adds tax savings by changing how your income is treated. Instead of paying self-employment tax on every dollar of profit (15.3%), you pay payroll taxes only on your reasonable salary. The rest can be taken as distributions that skip self-employment tax entirely.
The savings start to add up once your business income reaches about $80,000. For example, if your business makes $100,000 in profit, you might pay yourself a $60,000 salary and take $40,000 as distributions. You’d save around $6,120 in self-employment taxes on that distribution portion alone.
Think of it this way: your LLC keeps you protected, and the S Corp election makes sure you’re not overpaying on taxes. It’s like upgrading from economy to business class. Same business, better experience. Want to see what this looks like for you? Run your numbers through our tax calculator.
Electing S Corp status isn’t just about hitting numbers. Rather, it’s about knowing when the timing is right and what you stand to gain.
The math usually makes sense once your business income reaches around $80,000. At this point, the tax savings typically outweigh the added administrative costs.
Many solopreneurs assume you can only elect S Corp status at the start of a new year. In reality, you can file Form 2553 within two months and 15 days of the start of the tax year, the company’s formation date, or your chosen effective date, unlocking partial-year savings right when your profits justify the switch.
The real advantage of S Corp status isn’t just lower taxes. It’s the set of benefits that make your business run smarter and more professionally:
You reduce your self-employment tax burden, paying payroll taxes only on your reasonable salary.
You position yourself like a bigger business, separating salary from distributions, optimizing retirement contributions, and planning quarterly payments strategically.
You step fully into your role as a business owner, with payroll, tax planning, and integrated financial systems that reinforce your growth.
This evolution isn’t about changing your business; it’s about protecting what you’ve built and keeping more of what you earn.
Switching your LLC to S Corp status used to be a paperwork nightmare. Lettuce turns it into a streamlined, automated process that handles setup, payroll, and compliance for you.
Electing S Corp status meant piles of IRS forms, complicated payroll setup, and quarterly filings you had to track on your own. One missed deadline could wipe out your savings, and many solopreneurs felt like they had to become tax experts overnight.
Now, everything happens in one seamless platform designed for solopreneurs. Lettuce handles your LLC formation, S Corp election, business banking, and payroll automatically—no forms, no juggling tools, no compliance headaches. The system does the following:
Calculates your reasonable salary.
Runs S Corp payroll and manages tax withholdings.
Files quarterly taxes with built-in compliance monitoring.
Updates tax projections in real time.
What once took months of back-and-forth with accountants now happens in minutes. Instead of piecing together multiple apps, you get a complete financial operating system that keeps your business audit-ready while you stay focused on growth.
Here are the answers ambitious business-of-one owners need to make the smart move with confidence. No more guessing or wondering if you're doing it right, these answers give you the clarity to act.
File Form 2553 with the IRS to elect S Corp status, and your LLC stays intact. Eligibility requires being a U.S. entity with one class of stock and no more than 100 shareholders. Once approved, your LLC keeps all the same liability protections while gaining the tax treatment of an S Corp.
Yes. You’re not replacing your LLC, you’re simply adding S Corp tax treatment on top of it. Your LLC continues to serve as your legal business structure while the IRS taxes you under the S Corp rules.
Savings come from reducing self-employment tax. For example, on $100,000 in profit, you could save about $15,300 by paying tax only on your salary and taking the rest as distributions. Actual savings vary by income level, salary choice, and business expenses, so it’s best to run the numbers for your situation.
They work together. Your LLC is your legal structure, and an S Corp is just the tax status you elect. That means you don’t give up liability protection or flexibility—you simply change how your profits are taxed.
Not if you follow the rules. If you pay yourself a reasonable salary and keep accurate records, the IRS doesn’t view S Corps as higher audit risks. The main difference is that you’ll need to run payroll and file reports on time, which is manageable with the right system.
LLC protection and S Corp tax savings aren’t an either/or choice. They work best together. With the right election, you keep your liability shield while reducing self-employment taxes, often saving thousands each year. What used to require accountants, paperwork, and constant compliance checks is now simple, seamless, and built for solopreneurs.
You don’t have to juggle banking, payroll, bookkeeping, and tax filings on your own. Get started today with Lettuce and turn your LLC into a tax-smart S Corp in minutes, so you can focus on growing your business while your back office runs itself.