When to Consider S Corporation Election

You formed your LLC. Good job.
But many business owners unknowingly make critical mistakes after formation that quietly destroy liability protection, trigger audits, and limit growth.

In this episode, Mike walks through the 10 most common LLC mistakes business owners make in 2026 and explains exactly how to fix them. From mixing personal and business finances to ignoring tax planning and misclassifying owner compensation, this episode gives you a practical framework to audit your business and protect it the right way.

If you want your LLC to survive and thrive, not just exist on paper, this episode shows you what to fix now before it becomes expensive later.

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Chapters

(01:00) Mixing Personal and Business Finances
Why commingling funds breaks liability protection and how to properly separate accounts without overcomplicating things.

(02:00) Failing to Maintain LLC Compliance
Annual reports, renewals, and filings business owners forget that can cause administrative dissolution.

(03:20) Ignoring the S Corporation Opportunity
How LLC owners overpay self-employment taxes by not exploring an S Corp election at the right time.

(04:10) Misclassifying Owner Compensation
The difference between owner draws and W2 payroll, and why paying yourself the wrong way creates tax problems.

(05:45) Operating in the Wrong State
Why forming an LLC in one state but operating in another requires foreign registration.

(06:40) Skipping Tax Planning
Why taxes are often a business owner’s biggest expense and how proactive planning changes everything.

(07:30) Failing to Update State Filings
What happens when partners, addresses, or business purposes change and filings are not updated.

(08:10) Treating the LLC Like a Hobby
How hobby loss rules work and why consistent losses without profit motive raise red flags.

(09:00) The LLC Audit Checklist
Simple steps to audit your LLC today, fix weak spots, and build better habits going forward.

Podcast Host:

Mike Jesowshek, CPA – Founder and Host of Small Business Tax Savings Podcast
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🎙 ABOUT THE PODCAST
The Small Business Tax Savings Podcast is your go-to resource for cutting-edge tax strategies to help entrepreneurs legally slash their tax bills. Hosted by Mike Jesowshek, CPA, this show breaks down complex tax topics into clear, no-fluff insights so you can keep more of your hard-earned money.