Business profit is receipts less ordinary business expenses, including a negative result when costs exceed receipts. The cash ledger then adds entered household income and subtracts health premiums, retirement deposits and modeled taxes exactly once. A deductible contribution can lower tax and still leave less spendable cash; the scenario reports both changes instead of ranking every expense as a benefit.
Separate business profit, tax deductions and cash
Business profit is receipts less ordinary business expenses, including a negative result when costs exceed receipts. The cash ledger then adds entered household income and subtracts health premiums, retirement deposits and modeled taxes exactly once. A deductible contribution can lower tax and still leave less spendable cash; the scenario reports both changes instead of ranking every expense as a benefit.
The deductible half of base SE tax and eligible health or retirement deductions affect income-tax and adjusted QBI bases, not Schedule SE earnings. Cash paid remains an outflow even when it is nondeductible. The SEP model uses its dated employer limit; other plan deductions must be entered as reviewed eligible amounts. Unknown consequential eligibility prevents a final cash total while preserving the known tax subtotal.
Base SE tax applies to 92.35% of business profit once net earnings reach $400, with the owner's remaining Social Security wage base and uncapped Medicare earnings. Eligible health and SEP deductions reduce income-tax/QBI bases, not SE earnings; the deductible half excludes Additional Medicare.
Compare work and savings scenarios on the same basis
The offer comparison uses the same declared household facts, annual working hours and state estimate. Employee cash, separately priced noncash benefits and contractor cash appear in distinct rows. The contractor break-even offer is solved by recomputing tax at candidate gross amounts, then checking the cent recommendation and its preceding supported cent. This is an entered-assumption cash comparison, not a recommendation to change employment status.
The declared-salary illustration treats salary as wages, with employer and employee payroll taxes shown separately. Employer taxes and entered administration costs reduce the residual business distribution; an unfunded employer amount is not hidden. Results exclude income-tax and QBI differences, unemployment taxes, benefits and distribution-basis rules. Neither a profit threshold nor a fixed salary percentage establishes reasonable compensation or proves that an S corporation election saves money.
Only published 2025 and 2026 federal policies are selected; future indexed values are not invented. One owner business is modeled without aggregation, QBI loss carryforwards or REIT/PTP components. Business losses retain their cash effect, but an income-tax offset requires an entered reviewed eligible amount when other income is present. The calculator does not decide basis, at-risk, passive-loss, excess-business-loss or NOL eligibility.
Review dated funding and private financial state
Expected federal liability, required annual funding and the selected installment are separate results. State estimates and ordinary W-2 payroll are excluded from federal installments; withholding and dated payments are credited separately, so a funding target may still leave a filing balance.
The ordinary target is the lower of 90% of current federal tax or 100% of eligible full-year prior tax, increased to 110% when prior AGI exceeds $150,000 ($75,000 for MFS). The separate no-prior-tax exception requires full-year eligibility facts; unanswered facts leave funding unresolved rather than assuming a zero obligation.
The dated illustration applies simple daily underpayment segments: published 2025 rates are 7%, and 2026 quarters use 7%/6%/7%/7%. No 2027 rate is extrapolated; missing rates leave an explicit known subtotal, and relief, waivers and Form 2210 filing certification remain outside scope.
Draft saving is opt-in and stays on this device; reviewed sharing opens blank by default, and including amounts/history requires a deliberate choice. An opened full or blank link retains priority across Reload until a successful explicit save selects the edited draft; exported files never initiate or schedule payments.