Does an LLC need to become an S corporation?

That wording mixes legal form and federal tax classification. An eligible LLC can elect S corporation treatment; there is no universal answer for all agency founders. IRS — Entities 3: LLC tax classification

Require a comparison that includes payroll, owner duties, administration, ownership restrictions, state treatment and exit plans. For shareholder-employees, the IRS requires reasonable compensation for services before non-wage distributions; a generic salary percentage is not a substitute for supporting facts. IRS — S corporation compensation and medical insurance issues