Frequently Asked Questions

Generally when earning $130,000+ as a 1099 contractor. Below that, the administrative costs may outweigh tax savings. If you're earning $200,000+, you could be leaving $15,000-$25,000 on the table annually without an S-Corp structure.

Typical savings: $15,000-$25,000 annually on $200,000 income. The key is paying yourself a reasonable salary (40-50% of income) and taking the rest as distributions, which avoid the 15.3% self-employment tax.

The IRS requires S-Corp owners to pay themselves fair market value. For physicians, this is typically 40-60% of net income. We help determine the right split based on your specialty, location, and income level to ensure IRS compliance while maximizing your tax savings.

Yes, you can file Form 2553 anytime, but timing matters for maximizing benefits. Converting at year-start is most efficient. If converting mid-year, you'll have a split year with different tax treatment for each period. We handle all the paperwork and ensure proper timing.

Usually your home state where you practice. Delaware/Nevada advantages are mostly myths for small businesses—you'd still pay taxes in your home state anyway, plus pay Delaware fees. We incorporate you in the most cost-effective state for your situation.

CME courses, medical licenses, malpractice insurance (if you pay it), professional dues, home office, vehicle mileage, health insurance premiums, equipment, professional subscriptions, and travel to work sites. We'll help you identify all eligible deductions.

Yes, if you use a dedicated space exclusively for business. This includes a portion of rent/mortgage, utilities, and internet. The home office deduction can save $2,000-$5,000 annually and is perfectly legitimate for physicians who do administrative work from home.

You'll pay federal and state taxes quarterly (April 15, June 15, September 15, January 15). We calculate these for you based on your salary, distributions, and deductions to avoid underpayment penalties. We send reminders and provide exact amounts to pay.

Absolutely. A Solo 401(k) lets you contribute up to $69,000 (2024) as both employee and employer, all tax-deductible. This can save an additional $15,000-$25,000 in taxes annually. We can help you set this up and coordinate with your financial advisor.

Payroll processing, payroll tax deposits (941s), bookkeeping, bank reconciliation, quarterly financial statements, annual corporate tax return (1120-S), K-1 preparation, registered agent service, and annual state filings. Essentially, everything needed to keep your S-Corp compliant and optimized.

You don't need to send us every receipt monthly, but you must keep them for 7 years for IRS compliance. We'll set you up with a digital expense tracking system (like Expensify or Receipt Bank) that makes this effortless. Just snap photos of receipts and the system does the rest.

Typically 2-3 weeks from when we receive your information. Some states are faster (Delaware: 1 week) vs slower (California: 3-4 weeks). We handle all paperwork including articles of incorporation, EIN application, and IRS Form 2553 for S-Corp election.

A registered agent receives official state correspondence and legal documents on behalf of your business. This is required in all states. We handle this so official documents don't show up at your home address, and we ensure nothing gets missed.

Annual state reports (due dates vary by state), quarterly payroll tax returns (Form 941), annual corporate tax return (Form 1120-S), and your personal K-1. We handle 100% of these filings—you don't need to worry about any deadlines or paperwork.

State penalties for late annual reports range from $50-$500, and IRS penalties for late payroll taxes can be 2-15% of the amount due. We track all deadlines and file everything on time so you never face these penalties. That's part of what we do.

Wait until you've actually started 1099 work. You don't want corporate maintenance costs and filing requirements while still W-2. Contact us when you're 3-6 months from making the transition so we can plan the optimal timing.

Yes. Your 1099 income goes through the S-Corp. W-2 income is separate. You'll have a W-2 from your employer AND a W-2 from your own S-Corp. This is a common setup for physicians who moonlight or do locums work alongside a primary W-2 position.

Absolutely—locums physicians are ideal candidates since you're typically 1099 contractors and earning above the $130K threshold. Many locums physicians save $20,000-$30,000 annually through proper S-Corp structuring.

We can pro-rate services for shorter periods. However, annual tax filing and compliance requirements remain the same, so there's a minimum annual cost regardless of months active. We'll analyze whether the tax savings justify the cost in your specific situation.

Consider: tax savings alone are typically $15,000-$25,000 annually. Plus you save 120+ hours/year of administrative work. If your clinical time is worth $200/hour, that's $24,000 in time value. Total annual benefit: $39,000-$49,000 for a $10,000 investment. That's a 4-5x return.