When does it make sense to go from a sole proprietor to LLC or S corp

[Crgroadrebel88]

I run a private gym studio we have double or business from last year. Currently i am just a sole proprietor. 

My gross income will be about 140k this year. My question is i am married filing jointly with 2 kids, when is there a huge tax benefit for me to change to a LLC or S corp to save more money from being taxed? Is there a certain amount of money to reach or when would it be the most optimal to save money on taxes in my situation.

thanks!

[carolineb]

Good morning! Tax wise, not much of a difference by switching from a sole proprietorship to a single member LLC or S-corp, the benefit would be in the limited liability in the event of a lawsuit. If you create a single member LLC, you can continue to file a Schedule C on your personal return as usual, an S-Corp requires a separate tax return which can get pricy. I am including a link with additional information which may help you to make this decision: Should You Switch Your Side Hustle From A Schedule C Sole Proprietor To An LLC Or Corporation?