State guide · Connecticut · 2026 rules
S corporation in Connecticut: what the election changes
Connecticut puts no tax on an S corporation’s income. The election moves your pay onto payroll, where unemployment tax and CT Paid Leave apply.
Choose a state and enter your profit and salary to see the comparison.
The state
Connecticut follows the federal S election; no separate state form was found. Its corporation business tax does not reach an S corporation’s net income, so the profit stays on your own Connecticut return, as it does today. The S corporation files Form CT-1120SI.
The $250 business entity tax ended for taxable years from 2020. An LLC that elects stays an LLC with the Secretary of the State, and its annual report does not change. Connecticut has no city income taxes.
Payroll taxes on your salary
Unemployment insurance: 1.9% for a new employer on the first $27,000 of wages in 2026. Any officer of a corporation is an employee for this tax.
CT Paid Leave: 0.5% of your salary, deducted from your pay, up to the Social Security wage base. A sole proprietor takes part only by opting in. After the election your salary is wages, and the deduction applies.
The optional pass-through entity tax
A one-owner S corporation can elect Connecticut’s pass-through entity tax at 6.99%. You get a credit for 87.5% of your share. The election is made each year by checking a box on a timely filed Form CT-1120SI, and it cannot be undone for that year. The calculator leaves it out.
Worked examples
A single-member LLC owner, single filer, 22% federal bracket, default payroll and return costs. The figure is total tax and added costs as an S corporation compared with staying as you are.
| Profit / salary | No local tax |
|---|---|
| $80,000 / $45,000 | $287 lower |
| $120,000 / $60,000 | $2,614 lower |
| $200,000 / $90,000 | $7,244 lower |
Starting payroll in Connecticut
Register for state withholding with the Department of Revenue Services through myconneCT, and for unemployment insurance with the Connecticut Department of Labor through ReEmployCT. CT Paid Leave contributions go to the CT Paid Leave Authority.
Other states
- Alabama
- Alaska
- Arizona
- Arkansas
- California
- Colorado
- Connecticut
- Delaware
- Florida
- Georgia
- Hawaii
- Idaho
- Illinois
- Indiana
- Iowa
- Kansas
- Kentucky
- Louisiana
- Maine
- Maryland
- Massachusetts
- Michigan
- Minnesota
- Mississippi
- Missouri
- Montana
- Nebraska
- Nevada
- New Hampshire
- New Jersey
- New Mexico
- New York
- North Carolina
- North Dakota
- Ohio
- Oklahoma
- Oregon
- Pennsylvania
- Rhode Island
- South Carolina
- South Dakota
- Tennessee
- Texas
- Utah
- Vermont
- Virginia
- Washington
- Washington, DC
- West Virginia
- Wisconsin
- Wyoming
Sources
- Conn. Gen. Stat. §12-213 (Chapter 208, definition of net income, S corporations)
- Conn. Gen. Stat. §12-284b(b) (Chapter 213a), as amended by P.A. 19-117
- CT DRS, Pass-Through Entity Tax Information
- 2025 Form CT-PET, Line 2
- Conn. Gen. Stat. §12-699(b) (Chapter 228z)
- CT DOL, Information on Unemployment Tax Rate for Calendar Year 2026
- Conn. Gen. Stat. §31-222(a)(1)(B) (Chapter 567)
- CT Paid Leave Authority, Contributions
- Conn. Gen. Stat. §31-49g(b)(1)
- CT DOL, How do I register
Federal figures: IRS Publication 15 (2026), Schedule SE and Form 2553 instructions. Every figure was read on an official page and checked a second time. Checked October 24, 2026. How we check facts.