<prompt> Human: Or should I form an LLC? Im looking for ways to maximize my tax deductions next year Assistant: An S-Corp would reduce taxes if you had enough gross income left over after paying yourself a reasonable wage to avoid having to pay employment taxes on that excess.Lets look at an example. Lets say a doctor owns a medical practice that brings in 1,000,000 per year after paying overhead and expenses. The market wage for this specific doctors specialty is 500,000. Without an S-Corp, that doctor has to pay full taxes including Social Security, unemployment insurance, etc on the full 1m. If this doctor forms an S-Corp and pays him or herself a reasonable wage of 500k, he or she would pay the Social Security, unemployment insurance on the 500k. Now the doctor is free to take the remaining 500k as ownership distribution, which is NOT subject to employment taxes. Human: Is 34k enough gross income to make an S-Corp make sense?  <response>: It also depends on how much your profession would reasonably get paid. I started translating from around Q3 last year and made 30,000 for around 4 months of work, but as career translators all over are paid around that much for a full year, I was able to pay myself a reasonable portion and take the rest as business profit and not income. It would also save you a whole lot of money if you were able to incorporate without any help, but some of the paperwork can be confusing so I generally advise to get an accountant. 