Tennessee LLC Tax Calculator 2026

LLCs in Tennessee are pass-through entities for federal tax purposes. This means all net business income flows through to your personal tax return and is subject to federal self-employment tax (15.3% on 92.35% of net earnings up to $176,100 for Social Security, plus 2.9% Medicare on all earnings). An additional 0.9% Medicare tax applies to earnings above $200,000 ($250,000 married filing jointly).

Because Tennessee has no state income tax, LLC owners in Tennessee keep more of their business profits compared to states with income taxes. Your LLC income is only subject to federal income tax and self-employment tax. This makes Tennessee an attractive state for LLC formation from a tax perspective, though you should also consider other state fees, franchise taxes, and your physical business location.

If your LLC elects S-Corp status, you can potentially reduce your self-employment tax burden by paying yourself a reasonable salary and taking remaining profits as distributions. Use the calculator above to compare the default LLC treatment with S-Corp election for your specific situation in Tennessee.