State comparison · Tax year 2026
State-by-state S Corp costs,compared.
The S-Corp election saves on federal payroll tax — but each state adds its own layer of fees. This page compares all 50 states so you can see where the election pays for itself and where it barely breaks even.
01 · Why state costs matter
Federal savings minus state fees = net benefit
The S-Corp election saves money by shielding distributions from the 15.3% self-employment / FICA tax. On a $100K net profit with a $50K salary, the federal savings are roughly $10,300/yr — before state costs enter the equation.
But states don't stand still. Some charge an additional franchise tax on corporations that LLCs don't pay (California's 1.5%, New Jersey's CBT, New York's Article 9-A). Others charge the same annual report fee to both entity types. A few charge nothing at all. The net benefit of the S-Corp election is:
If the state-level delta is $0 (same fee for both entity types), the full federal savings flow through. If the state adds $1,500/yr in franchise tax on the S-Corp, that eats 15% of a $10,000 federal benefit. In California, it can eat the entire benefit at lower profit levels.
02 · All 50 states
S Corp recurring costs, state by state
All figures modeled at $100,000 net profit (the calculator's default). Recurring costs include the state annual report, franchise tax, and any corporation-specific fee the S-Corp election triggers. Sorted by S-Corp recurring cost, lowest first.
| # | State | LLC Fee | S-Corp Cost | Delta | State Tax |
|---|---|---|---|---|---|
| 01 | ArizonaAZ | $0 | $0 | $0 | |
| 02 | IdahoID | $0 | $0 | $0 | |
| 03 | MinnesotaMN | $0 | $0 | $0 | |
| 04 | MississippiMS | $0 | $0 | $0 | |
| 05 | MissouriMO | $0 | $0 | $0 | |
| 06 | New MexicoNM | $0 | $0 | $0 | |
| 07 | OhioOH | $0 | $0 | $0 | |
| 08 | South CarolinaSC | $0 | $0 | $0 | |
| 09 | South DakotaSD | $0 | $0 | $0 | |
| 10 | TexasTX | $0 | $0 | $0 | |
| 11 | PennsylvaniaPA | $7 | $7 | $0 | |
| 12 | ColoradoCO | $10 | $10 | $0 | |
| 13 | HawaiiHI | $15 | $15 | $0 | |
| 14 | KentuckyKY | $15 | $15 | $0 | |
| 15 | MontanaMT | $20 | $20 | $0 | |
| 16 | UtahUT | $20 | $20 | $0 | |
| 17 | MichiganMI | $25 | $25 | $0 | |
| 18 | OklahomaOK | $25 | $25 | $0 | |
| 19 | West VirginiaWV | $25 | $25 | $0 | |
| 20 | WisconsinWI | $25 | $25 | $0 | |
| 21 | NebraskaNE | $26 | $26 | $0 | |
| 22 | IndianaIN | $30 | $30 | $0 | |
| 23 | IowaIA | $30 | $30 | $0 | |
| 24 | New YorkNY | $9 | $34 | +$25 | |
| 25 | LouisianaLA | $35 | $35 | $0 | |
| 26 | VermontVT | $35 | $35 | $0 | |
| 27 | AlabamaAL | $50 | $50 | $0 | |
| 28 | GeorgiaGA | $50 | $50 | $0 | |
| 29 | KansasKS | $50 | $50 | $0 | |
| 30 | North DakotaND | $50 | $50 | $0 | |
| 31 | Rhode IslandRI | $50 | $50 | $0 | |
| 32 | VirginiaVA | $50 | $50 | $0 | |
| 33 | WashingtonWA | $60 | $60 | $0 | |
| 34 | WyomingWY | $60 | $60 | $0 | |
| 35 | IllinoisIL | $75 | $75 | $0 | |
| 36 | ConnecticutCT | $80 | $80 | $0 | |
| 37 | MaineME | $85 | $85 | $0 | |
| 38 | AlaskaAK | $100 | $100 | $0 | |
| 39 | New HampshireNH | $100 | $100 | $0 | |
| 40 | OregonOR | $100 | $100 | $0 | |
| 41 | FloridaFL | $138.75 | $138.75 | $0 | |
| 42 | ArkansasAR | $150 | $150 | $0 | |
| 43 | North CarolinaNC | $200 | $200 | $0 | |
| 44 | MarylandMD | $300 | $300 | $0 | |
| 45 | TennesseeTN | $300 | $300 | $0 | |
| 46 | DelawareDE | $400 | $400 | $0 | |
| 47 | MassachusettsMA | $500 | $500 | $0 | |
| 48 | NevadaNV | $650 | $650 | $0 | |
| 49 | CaliforniaCA | $800 | $1,500 | +$700 | |
| 50 | New JerseyNJ | $75 | $7,575 | +$7,500 |
Yellow dot = state has individual income tax. Blue dot = no state income tax. Delta = S-Corp cost minus LLC fee (the extra cost the S-Corp election triggers in that state). Negative delta means the S-Corp pays less than the LLC.
03 · Cheapest states
States where the S Corp costs the least
No state income tax + low recurring fees = the cleanest federal savings. These states have the lowest total S-Corp cost:
No state income tax
South Dakota
$0/yr
No income tax; no annual report fee. Lowest-cost state.
No state income tax
Texas
$0/yr
No income tax; franchise tax below $2.65M revenue = $0.
No state income tax
Washington
$60/yr
No income tax; $60 annual report. B&O tax may apply.
No state income tax
Wyoming
$60/yr
No income tax; $60 annual report fee.
No state income tax
Alaska
$100/yr
No income tax; $50/yr biennial report.
No state income tax
New Hampshire
$100/yr
No income tax; $100 annual report. BPT/BET may apply.
No state income tax
Florida
$138.75/yr
No income tax; $138.75 annual report is the only recurring fee.
Key insight: In no-income-tax states with low fees (SD, WY, FL, TX), the federal payroll-tax savings flow through almost entirely. At $100K net profit, the net S-Corp benefit in South Dakota is ~$9,100/yr after admin overhead — virtually the entire federal savings.
04 · Most expensive states
States where the S Corp costs the most
These states layer on additional franchise taxes, corporation business taxes, or fixed-dollar minimums that significantly increase the S-Corp's recurring cost:
California
California's S-Corp franchise tax is 1.5% of net income (RTC § 23186) with an $800 minimum — on top of the $800 minimum franchise tax that LLCs also pay. At $100K net profit, the S-Corp pays $1,500/yr vs. the LLC's $800, a delta of $700. At $200K, the delta is $2,200. This is the single largest state-level cost for S-Corps in the country.
Run California numbers →New Jersey
New Jersey S-Corps pay the Corporation Business Tax (CBT) — the greater of an ENI-rate tax (6.5%–9%) or a gross-receipts-based minimum ($375–$1,500) — plus the $75 annual report. This is a real entity-level tax that LLCs do not pay. At $100K net profit, the CBT minimum alone is $562.
Run New Jersey numbers →New York
New York S-Corps pay the Article 9-A fixed-dollar minimum tax (Tax Law § 210.1) on top of the $9 biennial statement. The FDM is tiered on NY receipts: $25 at ≤$100K, up to $4,500 at >$25M. At $100K net profit, the total S-Corp recurring cost is $34 ($9 biennial + $25 FDM). At $500K+, it climbs to $309+.
Run New York numbers →Nevada
Nevada has no state income tax, but the recurring cost is $650/yr — a $150 Annual List (NRS 86.263) plus a $500 State Business License fee. This is the highest flat fee among no-income-tax states and can offset a meaningful chunk of the federal savings at lower profit levels.
Run Nevada numbers →05 · Break-even risk
States where the S Corp barely breaks even
These states have high recurring fees that significantly offset the federal payroll-tax savings. At $100K net profit, the net benefit after state costs is the thinnest:
| State | S-Corp Cost | Delta vs LLC | Why it's high |
|---|---|---|---|
| New JerseyNJ | $7,575 | +$7,500 | CBT minimum $375+ plus $75 annual report |
| CaliforniaCA | $1,500 | +$700 | 1.5% franchise tax on net income + $800 minimum |
Break-even math: At $100K net profit, the federal payroll-tax savings are ~$10,300/yr. After $1,200 admin overhead, that leaves ~$9,100. A $650 state fee (NV) eats 7% of that. A $1,500 CA franchise tax eats 16%. At $60K net profit, the federal savings are ~$5,500 — and California's $700 delta alone eats 13% before admin costs.
06 · Run your numbers
How to use the per-state calculator
This table gives you the 30,000-foot view. For your actual decision, run the per-state calculator with your specific net profit and salary:
Pick your state
Every state has a dedicated calculator page at /llc-vs-scorp/[state]/. Click any state name in the table above, or use the links in the cheapest / most expensive sections.
Set your net profit and salary
Use the slider or type your actual net profit. The calculator adjusts the state's recurring cost in real time — including profit-dependent states like California (1.5% franchise tax) and New York (Article 9-A FDM tiers).
Read the net benefit
The calculator shows the federal payroll-tax savings, subtracts the modeled admin overhead, and nets out the state-level cost delta. The final number is your estimated annual benefit (or loss) from the S-Corp election — specific to your state and profit level.
07 · FAQ
Frequently asked questions
What counts as the S-Corp's 'recurring cost' in this table?
It includes the state-level annual report, franchise tax, privilege tax, or corporation business tax that the S-Corp election triggers — the fees an LLC in the same state does not pay (or pays less of). It does not include federal costs like payroll service ($30–$100/mo) or CPA fees for Form 1120-S ($500–$1,500). Those are constant across states.
Why does California show the highest S-Corp cost?
California imposes a 1.5% franchise tax on S-Corp net income (RTC § 23186) with an $800 minimum — on top of the $800 minimum franchise tax that LLCs also pay. At $100K net profit, the S-Corp pays $1,500/yr in franchise tax versus the LLC's $800, making California the most expensive state for the S-Corp election.
Which states have zero S-Corp recurring cost?
Arizona, Idaho, Minnesota, Mississippi, Missouri, New Mexico, Ohio, South Carolina, and South Dakota charge no recurring SOS annual report fee for either LLCs or S-Corps. South Dakota also has no state income tax, making it the lowest-cost state for the S-Corp election overall.
Does the S-Corp election still make sense in high-cost states?
It depends on your net profit. At $200K+ net profit, the federal payroll-tax savings (often $10K–$15K/yr) can still outweigh state-level costs like California's 1.5% franchise tax or New Jersey's CBT. At lower profit levels, the state fees can eat most or all of the federal benefit. Run the per-state calculator for your specific numbers.
What is the NY Article 9-A fixed-dollar minimum?
New York S-Corps must file Form CT-3-S and pay the Article 9-A fixed-dollar minimum tax, tiered on NY receipts: $25 (≤$100K), $50 ($100K–$250K), $175 ($250K–$500K), $300 ($500K–$1M), $1,000 ($1M–$5M), $3,000 ($5M–$25M), $4,500 (>$25M). This is in addition to the $9 biennial statement. The table uses net profit as a proxy for NY receipts.
Why is Texas $0 if it has a franchise tax?
Texas has no state individual income tax. The Texas franchise tax has a no-tax-due threshold: entities with annualized total revenue ≤ $2.65M owe nothing (TBOC § 171.002). Most small businesses fall below this threshold, so the modeled recurring cost is $0/yr.
Can I use this table to decide which state to form in?
The table shows recurring costs, but formation cost, state income tax rate, and where you physically operate matter too. If you live and work in California, forming in Wyoming doesn't eliminate California's franchise tax on CA-source income. Use the table as one input — then run the per-state calculator for a full picture.
How does the S-Corp election interact with state income tax?
The S-Corp election shields distributions from the 15.3% federal payroll/SE tax, but state income tax still applies to both salary and distributions at the owner's individual rate. In no-income-tax states (TX, FL, WY, NV, WA, SD, AK, TN, NH), there's no additional state income tax layer — making the federal savings cleaner.
Model the S-Corp benefit for your state and profit level.
The BizTaxMetrics calculator combines federal payroll-tax savings with your state's actual recurring costs — updated for tax year 2026. Run your numbers in 60 seconds.