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The four ways an LLC can be taxed
| Tax status | Who | Federal return | How profit is taxed | Due (calendar year) |
|---|---|---|---|---|
| Disregarded entity (default for 1 owner) | Single-member LLC | Schedule C on the owner’s Form 1040 (+ Schedule SE) | Profit taxed on the owner’s return; 15.3% self-employment tax on net earnings | April 15 |
| Partnership (default for 2+ owners) | Multi-member LLC | Form 1065 + a Schedule K-1 for each member | No tax at the LLC level; each member reports their share and pays self-employment tax | March 15 |
| S corporation (by election) | Any eligible LLC that files Form 2553 | Form 1120-S + K-1s; owners on payroll | Owners pay payroll tax on a reasonable salary; remaining profit passes through without self-employment tax | March 15 |
| C corporation (by election) | Any LLC that files Form 8832 | Form 1120 | Corporate income tax at the entity level; dividends taxed again to owners | April 15 |
General information from IRS publications, not tax advice. Your situation may differ — confirm with a CPA or enrolled agent before you act. Verified October 18, 2026. We may earn a commission if you sign up through our links, at no cost to you. How we’re funded.
Single-member LLC taxes
Unless it elects otherwise with Form 8832, a domestic LLC with one owner is “disregarded as separate from its owner” for income tax. If you’re an individual, the business goes on Schedule C of your Form 1040, and you pay self-employment tax on net earnings with Schedule SE. The LLC is still treated as a separate entity for employment taxes and certain excise taxes — so it needs its own EIN if it has employees.
Foreign-owned? A single-member LLC owned by a non-US person must file Form 5472 with a pro forma Form 1120 every year, even with no US income. The penalty for missing it is $25,000.
Multi-member LLC taxes
With two or more members, the default is a partnership. The LLC files Form 1065 by the 15th day of the third month after year end (March 15 for calendar years) and sends each member a Schedule K-1. Filing late costs $255 per member per month, for up to 12 months.
Electing S corp or C corp status
An LLC can choose to be taxed as a corporation. Most owners who do this pick S corporation status (Form 2553) to cut self-employment tax: they pay themselves a reasonable salary through payroll and take the rest as distributions. It adds payroll and a separate return, so it usually pays off only above a certain profit. LLC vs S corp · S corp savings calculator.
C corporation status (Form 8832) taxes profit at the company level and again when paid out as dividends; it’s mainly used by companies raising venture capital or retaining large profits.
Don’t forget state taxes and fees
Federal pass-through treatment doesn’t exempt an LLC from state obligations. California charges an $800 annual tax, Texas requires a franchise tax report every year, and Delaware charges an annual LLC tax. Our state LLC fees index and deadline calculator cover these.
Getting help with LLC taxes
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Frequently asked questions
How is a single-member LLC taxed?
By default the IRS treats it as a “disregarded entity”: you report the LLC’s income and expenses on Schedule C of your personal Form 1040 and pay self-employment tax (15.3%) on net earnings through Schedule SE. The LLC itself doesn’t file a federal income tax return — unless it’s foreign-owned, in which case it must file Form 5472 with a pro forma Form 1120.
How is a multi-member LLC taxed?
By default as a partnership. The LLC files Form 1065 by March 15 (calendar year) and gives each member a Schedule K-1; members pay income tax and self-employment tax on their shares on their own returns.
Does an LLC pay taxes itself?
Not federal income tax by default — profits “pass through” to the owners. It may owe federal payroll taxes if it has employees, and state taxes such as California’s $800 annual tax or the Texas franchise tax regardless of classification.
Can an LLC be taxed as an S corp?
Yes. An eligible LLC files Form 2553; it then doesn’t need Form 8832. The S corp must have no more than 100 shareholders, one class of stock and no nonresident alien shareholders. LLC vs S corp explained.
What is self-employment tax for an LLC owner?
15.3% — 12.4% Social Security on earnings up to the wage base ($184,500 in 2026, $192,300 in 2027) plus 2.9% Medicare on all earnings. An additional 0.9% Medicare tax applies above $200,000 (single) or $250,000 (married filing jointly). You can deduct half of it.
Do LLC owners pay estimated taxes?
Usually yes — if you expect to owe $1,000 or more for the year. Payments are due April 15, June 15, September 15 and January 15. See all LLC tax deadlines.
Your LLC setup checklist
- Get a free EINFrom the IRS, in minutes online.
- Open a business bank accountKeep LLC money apart from yours to protect the liability shield.
- Sign an operating agreementSettle who owns and decides what before it matters.
- Get business insuranceCover what the LLC itself doesn’t protect.
- Track state deadlinesFree reminders before each filing.
Everything in one list: printable LLC compliance checklist · live deadline calendar.