A single member LLC is treated as sole proprietorship on the tax return nd the net profit from that is self employment income subject to self employment tax.
One way to reduce self employment tax is to elect to treat your LLC as an S Corporation on your tax return. You can classify some of your income as salary and some as a distribution. You'll still be liable for self-employment taxes on the salary portion of your income, but you'll just pay ordinary income tax on the distribution portion. Depending on how you divide your income, you could save a substantial amount of self-employment taxes just by electing to treat your LLC as an S Corporation on the tax return.
