We are not your accountant, lawyer, or tax adviser
Scorply is a self-help tool operated by Handler Labs LLC. We are not a law firm, an accounting firm, or an enrolled agent, and using Scorply does not create any professional relationship between us. We do not review your circumstances, we do not advise you on what to do, and no one at Scorply signs your return or represents you before the IRS.
Everything the site produces is generated from the answers you give it. If those answers are wrong or incomplete, the output will be too. You are responsible for the accuracy of what you file.
The calculator produces estimates, not conclusions
The savings calculator models federal tax only, for a single owner-operator taking the standard deduction, with no self-employed health insurance premiums, no retirement plan contributions, and no qualified property. It excludes state and local taxes entirely. Real situations routinely depart from those assumptions, and each departure changes the answer.
A positive result is not a recommendation to elect, and a negative one is not a prohibition. It is arithmetic on the figures you entered.
There is no safe salary percentage
Reasonable compensation is a facts-and-circumstances legal standard. The widely repeated “60/40 rule” has no statutory, regulatory, or case-law authority, and neither does any other ratio. Where Scorply shows the salary that minimizes tax in its model, that is an observation about the arithmetic and is expressly not a recommendation. Setting your salary to whatever minimizes tax is the position the IRS most often challenges.
We cannot guarantee the IRS will accept anything
Whether the IRS accepts an S-corporation election, and whether it grants relief for a late one under Rev. Proc. 2013-30, is entirely the IRS’s decision. We screen you against the published conditions and prepare a filing that meets the procedural requirements. We do not and cannot promise an outcome, and you should be skeptical of anyone who does.
Tax law changes, and so do IRS addresses
We verify our figures and filing addresses against primary sources and record the date we did so on the relevant pages. The IRS moves fax numbers and mailing addresses without much notice, and state rules change more often than that. If you are filing close to a deadline, confirm the address against irs.gov before you send anything.
Not affiliated with the IRS
Scorply is not affiliated with, endorsed by, or associated with the Internal Revenue Service, the U.S. Department of the Treasury, or any government agency. IRS Form 2553 is available free of charge from irs.gov. You are paying us for guided preparation and filing instructions, not for the form.
When to get a professional involved
Please speak to a CPA or tax attorney if any of these apply to you:
- You have more than one owner, or an owner who is a trust or estate.
- Your operating agreement contains a preferred return, a distribution waterfall, or any non-identical distribution rights.
- You operate in more than one state, or you are unsure where your principal place of business is.
- Any owner is a nonresident alien, or lives outside the United States.
- Your taxable income is above the Section 199A threshold, where the salary decision inverts.
- You have already filed returns inconsistently with the election you now want.
- Your late-election window has closed and you are considering a private letter ruling.