Originally Posted by JP513

S Corp.

It's far superior to being self-employed because of social security taxes, which are 15.65%. If employed, employee and employer each pay half--but self employed obviously has to pay ALL.

Let's say you make $100k.

As a self-employed person, you pay $15.65k on soc sec taxes.

S Corp is better because you can make yourself an employee and the S Corp can pay you a salary of, say, $30k. Your company and you pay the 15.65% soc sec taxes on that $30k, which is only $4695, vs. $15.65k as self employed.

You can't avoid income taxes to the S Corp on the other $70k, but you can avoid soc sec taxes cause it's not salaried back to you. You can just withdraw money from the company as needed.

This is all legal. But don't take my advice--check with your CPA and/or lawyer.