What is the service price range to help a client from LLC to S Corp conversion?

[kwyp]

I have two questions related to LLC to S Corp conversion:

1.) What is the price range for providing such service? which include at least of filing form 2553, bookkeeping setup, payroll setup, apply for an EIN, and ect.

2.) If the taxpayer has two incomes at the same time: W2 income and a business income on Sch C.

If his W2 income is about 160K and his LLC income is about 100K. Under such situation, whether it is necessary for him to consider conversion from LLC to S corp? With 160K w2 income, he already pays the maximum self-employment tax. 

[TaxGuyBill]

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@kwyp wrote:

I have two questions related to LLC to S Corp conversion:

1.) What is the price range for providing such service? which include at least of filing form 2553, bookkeeping setup, payroll setup, apply for an EIN, and ect.

2.) If the taxpayer has two incomes at the same time: W2 income and a business income on Sch C.

If his W2 income is about 160K and his LLC income is about 100K. Under such situation, whether it is necessary for him to consider conversion from LLC to S corp? With 160K w2 income, he already pays the maximum self-employment tax. 

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It sounds like being taxed as an S-corporation would result in MORE Social Security tax (plus more fees and other stuff).  Does the client realize that?  Why does he want his business to be taxed as an S-corporation?

[Strongsilence-CPA]

1. $2K to $3K

[kwyp]

Here is my question: 

If a person earns over 160K on W2, does he need to pay any self-employment tax on his 1099 NEC income? 

[Strongsilence-CPA]

yes, medicare tax. use google for details.

[kwyp]

thank you for your input. 

Self employee tax is only about  medicare tax of 2.9% with a w2 income of 160K.  Comparing with the cost of accounting service, is it better option just keeping the business as LLC without convertion? 

[TaxGuyBill]

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@kwyp wrote:

If a person earns over 160K on W2, does he need to pay any self-employment tax on his 1099 NEC income? 

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As a Schedule C, he would pay 2.9% for Medicare, plus possibly 0.9% for the Additional Medicare Tax.

As an S-corporation, the wages would be subject to 15.3% FICA tax, then 6.2% would be refunded on the 1040, for a net total of 9.1% (plus possibly the 0.9% for the Additional Medicare Tax).  The non-wage profit would not be subject to any of the Social Security or regular Medicare tax.

[Strongsilence-CPA]

Are you using Intuit Tax Advisor?