S Corp. only saves 1.6% SE vs LLC; Am i crazy?

Individuals can also deduct 50% of the SE.For S Corp, S pays half and individual pay the other half. For LLC, individuals pay 14%. Assuming 37% income tax, is the below hypo calc correct? Please correct me!

S Corp LLC
Income 100 100
Empoyment Tax 7 0
Net Income 93 100

Individual level
Empoyment Tax 6.51 14
Income Tax 33.2 34.41
Net Income 53.2 51.59

1.69435

If the S corp is 100% owned by an individual, they pay, in effect, both sides of the FICA. It's just coming out of a different pocket, but the same amount is going to the Treasury.

I'm a little worried that I will embarrass myself with too simple of an answer due to not understanding the question and the calculation - but I'll go out on a limb.

The s corp saving comes from the shareholder/employee receiving a MIX of wages and pass through income.

I think in the OP, the calculation assumes $100,000 in wages paid.

Let's say that the owner of this s corporation provides services to the s corporation that are reasonably worth $60,000.

The owner takes $60,000 in salary.

The remaining $40,000 is passthrough income subject to income tax but it is NOT subject to employment-related taxes.

Tax savings approximately $6,000.

(several other factors at play here, however - other job wages, less social security at retirement, QBI, SEP, just to name a few).

Got it! Thank you ! You are right

You may find this calculator helpful: https://accountants.intuit.com/tax-refo ... alculator/

Since TCJA of 2017, the FICA savings are heavily offset by other factors such as a smaller QBID. The tax savings are much smaller than they use to be.

If 100% of the S Corp's net income is reasonable comp, they shouldn't be an S Corp. Due to both the QBID dynamic and the Solo 401k dynamic.

Since TCJA of 2017, the FICA savings are heavily offset by other factors such as a smaller QBID. The tax savings are much smaller than they use to be.

But PTET regimes (in states that have it) can be a significant savings; that's what finally got me to incorporate.