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I am in the process of creating an LLC and am trying to decide whether to file as an S Corp.
I make $80,000 at my day job and would be paying myself (via W2) at least 30,000, so I would be above the $110,100 income limit on which I'd have to pay social security tax.
Either way, I will be make $110,100 in 2012. So is there any advantage to filing as an S Corp?
Am I correct that I won't pay social security tax on anything over $110,100 that I make from my day job and my LLC combined?
That is correct, the SS cap is on total wages, not each wage. When you create an LLC (as a disregarded entity), you don't pay yourself with a W2, all the LLC earnings are your earnings. So instead of Social Security deductions, you will be paying Self-Employement Tax (which totals to the same amount as you would be paying with W2 to yourself, just under different name).
Note that S-Corp is a pass-through entity for Federal taxes, so there's not much difference from LLC being taxed as LLC (other than extra complexity, for S-Corp you need to file additional forms while LLC is completely invisible on your Federal taxes). It may be different on a state level, but probably not much as well.
S-Corp existed when there were no LLC's, but now I don't see a reason to ever deal with S-Coprs unless you're dealing with shareholders and shares.
Something to take into the account: if you're paying yourself with W2 - you'll have to deduct the FICA taxes on all your earnings, and then get credit on your 1040. With LLC - you won't have to pay and wait for refunds.
