There is no such thing as "filing as an LLC". When you form an LLC by default the IRS considers the LLC a disregarded entity and will tax you just as if you were a sole proprietorship. (i.e. you will report your income on schedule c) You can however elect to have your LLC taxed as an S Corporation. In which case you have to pay yourself a reasonable salary and then you can take a distribution on any excess income above your reasonable salary. When you take a distribution from an S Corp it is only subject to ordinary income tax. You do NOT pay self-employment tax on distributions. If you don't believe me you can read it on TurboTax's website (https://turbotax.intuit.com/tax-tips/small-business-taxes/ho...) or any number of websites for that matter.