S-Corp CPA in Plano, TX: Election, Salary Strategy, and 1120-S Tax Filing
Plano has become one of the most concentrated corridors of high-earning professionals and business owners in all of North Texas. With a median household income around $95,000 and a corporate ecosystem anchored by Toyota’s North American headquarters, JPMorgan Chase, Liberty Mutual, and Ericsson along the Legacy West corridor, thousands of Plano residents run side businesses, consulting practices, and professional services alongside their W-2 careers. For many of these owners, electing S-Corp status is the single most effective way to reduce self-employment tax, often saving $5,000 to $20,000 or more per year depending on net income.
Our Services
Our S-Corp Election and Tax Services for Plano Clients
When Plano business owners come to us for S-Corp help, here is exactly what we deliver:
- S-Corp election analysis: We review your net business income, industry, and personal tax situation to determine whether S-Corp status will actually save you money or create unnecessary complexity.
- IRS Form 2553 filing: We prepare and submit your S-Corp election to the IRS, including late election requests with reasonable cause statements for businesses that missed the standard deadline.
- Reasonable salary determination: We research comparable compensation data for your role and industry in the Plano and Dallas-Fort Worth market, then document a salary that withstands IRS scrutiny.
- Payroll setup and processing: S-Corps require the owner to run payroll. We set up your payroll system, process quarterly payroll tax filings (Forms 941), and handle annual W-2 preparation.
- Annual 1120-S return and K-1 preparation: We prepare your S-Corp’s federal tax return and generate Schedule K-1s for each shareholder showing their share of income, deductions, and distributions.
- Texas Franchise Tax compliance: Every Texas S-Corp must file a franchise tax report and Public Information Report annually by May 15. We handle both filings, priced at $250 to $500 depending on complexity.
Why Plano Businesses and Residents Choose AG Freideman
30+ years of hands-on experience: Al Freideman has worked with S-Corp owners across dozens of industries throughout his career. Whether you are a Plano-based IT consultant, a dental practice near Legacy Drive, or a construction company serving Collin County, Al has handled returns like yours before and knows the deductions that less experienced preparers miss.
Personal attention on every engagement: At AG Freideman, you work directly with Al, not a seasonal associate or junior staff member. When Plano clients call, Al answers. When your 1120-S is filed, Al reviewed it. That consistency is why we have 52 five-star Google reviews with zero negative reviews.
Virtual appointments for all of Plano and DFW: Our office is on Preston Road in North Dallas, a quick drive south on the Dallas North Tollway from most Plano neighborhoods. But most of our Plano clients work with us entirely through virtual meetings and secure document sharing. You get the same personal service without fighting traffic on the DNT or 75.
Transparent pricing with no surprises: S-Corp and partnership tax returns (Form 1120-S/1065, including K-1 preparation) are $1,000 to $2,000. Monthly bookkeeping with payroll processing runs $300 to $600 per month. We quote your price upfront, and that is the price you pay.
S-Corp Election and Tax Questions from Plano Clients
When does an S-Corp election make sense for a Plano business owner?
Generally, an S-Corp election starts saving money when your business nets roughly $40,000 to $50,000 or more per year after expenses. Below that level, the added costs of payroll processing, additional tax filings, and compliance often eat up the self-employment tax savings. Many Plano professionals, especially consultants, IT contractors, and practice owners earning six figures, are well above that threshold and see significant savings from electing S-Corp status.
How much can an S-Corp save me in self-employment tax?
Self-employment tax is 15.3% on net business income (the combined Social Security and Medicare tax). With an S-Corp, you only pay that 15.3% on your reasonable salary, not on the remaining profit distributed to you as a shareholder. For example, a Plano consultant earning $150,000 in net profit who sets a reasonable salary at $80,000 would save roughly 15.3% on the $70,000 in distributions, which comes to about $10,710 per year. The exact savings depend on your income, salary level, and whether you exceed the Social Security wage base ($168,600 in 2026, with the IRS adjusting annually).
What is a reasonable salary for an S-Corp owner?
The IRS requires S-Corp owners who perform services for the business to pay themselves a “reasonable salary” before taking distributions. There is no fixed formula. We look at what someone in your role, industry, and geographic market (Plano and the broader DFW area) would earn as an employee. For a management consultant in Plano, that might be $75,000 to $110,000. For a trades business owner, it might be $50,000 to $80,000. We document the analysis so you have a defensible position if the IRS ever asks.
Can you file a late S-Corp election for my Plano business?
Yes. The standard deadline to file Form 2553 is March 15 of the tax year you want the election to take effect (or within 75 days of forming the entity). If you missed that deadline, the IRS allows late election relief under Revenue Procedure 2013-30, provided you meet certain requirements. We have filed successful late elections for many business owners. We prepare the reasonable cause statement and supporting documentation as part of the filing.
Does Texas charge a state income tax on my S-Corp?
Texas has no state income tax for individuals or businesses. However, Texas does impose a franchise tax (sometimes called the margin tax) on most business entities, including S-Corps. The franchise tax is based on revenue, not profit, and the rate depends on your business type and total revenue. Entities with total revenue below the no-tax-due threshold ($2.47 million for reports due in 2026) still must file the report. We handle your franchise tax filing and Public Information Report each year so you stay compliant with the Texas Comptroller.
Do I need to change my LLC to become an S-Corp?
No. An S-Corp election is a tax classification, not a change in your legal entity. If you already have a Texas LLC, you keep the LLC structure and simply file Form 2553 with the IRS to be taxed as an S-Corp. You do not need to form a new entity or pay another $300 filing fee to the Texas Secretary of State. Your LLC operating agreement should be reviewed to ensure it supports S-Corp tax treatment, and we walk Plano clients through that process.
Get Started from Anywhere in Plano
Whether you are near Legacy West, the Shops at Willow Bend, or anywhere else in Plano, we make the process simple. Most of our Plano clients start with a free virtual consultation where Al reviews your current business structure and income, runs the self-employment tax savings math, and gives you a clear recommendation on whether an S-Corp election is worth pursuing. If it is, we handle everything: the election filing, payroll setup, bookkeeping, and your annual 1120-S return. Call (972) 893-3481 or book your free consultation at agfreideman.com/meeting/ to get started.
Visit Our Office
Address: 17304 Preston Rd Ste 861, Dallas, TX 75252
Phone: (972) 893-3481
We also offer virtual appointments for clients throughout the DFW metroplex who prefer to meet remotely.
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Book your free consultation with Al Freideman, CPA. 30+ years experience serving Dallas-Fort Worth.