Say my "profit" is 110K. I then pay myself 100K and keep 10K in the business. I currently take that 100K and transfer money to my personal account once a month. I then have to pay regular Fed taxes and the 15% FICA on the whole amount (110K minus personal exemtpions, etc). If I do an S-Corp election, then I can "pay" myself 50K (with W2) and take a distribution of 50K. Then I only have to pay the FICA part on the first 50K and regular fed on the remaining 60K. So that $9000 savings is well worth the extra couple hundred bucks to my accountant. Am I missing something?