Chimney Sweep Business: S-Corp vs. Sole Proprietorship Tax Comparison

Chimney sweep S-Corp analysis:

Industry characteristics:

• Revenue per sweeping: $150-$350
• Revenue per inspection (Level 2 with camera): $250-$500
• Revenue per relining: $2,000-$6,000
• Revenue per crown/cap repair: $500-$2,000
• Materials: 5-15% of revenue (sweeping) to 25-35% (repair/relining)
• Workers’ comp: 6-10% of payroll
• Certification: CSIA (Chimney Safety Institute of America) certification valued but not legally required in most states
• Seasonality: strong (60-70% of revenue September through January)
• Average operator: $150,000-$250,000 revenue as a solo operator with seasonal help

NOT an SSTB: Chimney services are a maintenance/repair trade. Full QBI deduction at all income levels.

S-Corp break-even:

At $70,000 net profit (8% WC):

• Sole prop SE tax: $9,885
• S-Corp: salary $40,000, WC $3,200, employer FICA $3,060, payroll $1,200, return $1,000
• S-Corp total: $8,460
• Savings: $1,425 (minimal)

At $100,000 net profit (8% WC):

• Sole prop SE tax: $14,122
• S-Corp: salary $50,000, WC $4,000, employer FICA $3,825, payroll $1,200, return $1,000
• S-Corp total: $10,025
• Savings: $4,097

At $140,000 net profit (8% WC):

• Sole prop SE tax: $19,770
• S-Corp: salary $55,000, WC $4,400, employer FICA $4,208, payroll $1,200, return $1,000
• S-Corp total: $10,808
• Savings: $8,962

Break-even: approximately $65,000-$75,000 net profit. The moderate WC rate keeps the break-even in line with other service trades.