Does this include FICA wage base caps?

No. SE tax is a flat rate here; adjust down if above the Social Security wage base.

Local/state tax differences?

Not modeled; adjust income tax rate to approximate your combined marginal rate.

Benefits like 401(k) match?

Include their value in W-2 benefits and in benefits replacement for 1099 if you’ll replicate them.

Is 1099 net the same as take-home?

This is after modeled taxes/benefits/expenses but before any personal deductions; real take-home varies.

How to handle part-year 1099?

Adjust hours and expenses to reflect the period you’ll contract.

finance calculator

1099 vs W-2 Take-Home Calculator

Compare contractor (1099) vs employee (W-2) take-home by factoring rate/hours, expenses, SE tax, income tax, and benefits.

Results

W-2 total comp (salary + benefits): $96,000
1099 gross (rate × hours): $110,000
1099 taxable after expenses: $106,000
1099 self-employment tax: $16,218
1099 income tax (est.): $23,320
1099 net after taxes/benefits: $60,462
1099 net after expenses/benefits (pre-tax): $100,000

How to use this calculator

Enter W-2 salary and value of employer-paid benefits.
Enter 1099 hourly rate, hours, and expenses.
Enter SE tax rate, income tax rate, and benefits replacement cost.
Review W-2 total comp, 1099 gross/taxes/net, and compare take-home.

Inputs explained

W-2 salary: Employee salary before taxes.
W-2 benefits: Value of employer-paid benefits (health/retirement/etc.).
1099 rate/hours: Contractor hourly rate and annual hours you expect to bill/work.
1099 expenses: Deductible business expenses.
SE tax rate: Approximate self-employment tax; simplified flat rate.
Income tax rate: Marginal tax rate for this comparison.
Benefits replacement: Your cost to replace benefits when 1099.

How it works

W-2 total comp = salary + employer-paid benefits.

1099 taxable = rate × hours − expenses. SE tax + income tax apply. Benefits replacement is subtracted to match W-2 benefits.

Net = taxable − taxes − benefits replacement; also shows pre-tax contractor cost after expenses/benefits.

Formula

W-2 total comp = Salary + Benefits
1099 gross = Rate × Hours
1099 taxable = Gross − Expenses
SE tax = Taxable × SE rate
Income tax = Taxable × Income tax rate
1099 net = Taxable − SE tax − Income tax − Benefits replacement

When to use it

Comparing job offers vs contractor engagements.
Checking if a contractor rate covers taxes, expenses, and lost benefits.
Budgeting take-home pay when switching from W-2 to 1099.

Tips & cautions

Contractor rates usually need to be higher to cover taxes/benefits; adjust rate/hours to test breakeven.
SE tax is simplified; actual SE tax phases with wage bases. For precision, use detailed tax tools.
If benefits are richer on W-2, increase benefits replacement to see the true gap.
Simplified flat tax rates; actual taxes depend on brackets, deductions, wage bases, and credits.
Does not include state/local tax differences between W-2/1099 structures.
Does not model retirement deductions, healthcare premiums, or FICA wage base caps precisely.

Worked examples

$90k W-2 + $6k benefits vs $55/hr × 2,000 hrs, $4k expenses, 15.3% SE, 22% income tax, $6k benefits replacement

W-2 total comp = $96,000
1099 gross = $110,000; Taxable = $106,000
SE tax ≈ $16,218; Income tax ≈ $23,320
1099 net ≈ $60,462 after benefits replacement

$100k W-2 + $8k benefits vs $70/hr × 1,800 hrs, $5k expenses, 15.3% SE, 24% income tax, $7k benefits replacement

W-2 total comp = $108,000
1099 gross = $126,000; Taxable = $121,000
SE tax ≈ $18,513; Income tax ≈ $29,040
1099 net ≈ $66,447 after benefits replacement

Deep dive

This 1099 vs W-2 take-home calculator compares contractor and employee compensation by factoring rate/hours, expenses, self-employment tax, income tax, and benefits replacement.

Use it to see if a contract rate truly beats a salary after covering taxes and benefits.

FAQs

Does this include FICA wage base caps?: No. SE tax is a flat rate here; adjust down if above the Social Security wage base.
Local/state tax differences?: Not modeled; adjust income tax rate to approximate your combined marginal rate.
Benefits like 401(k) match?: Include their value in W-2 benefits and in benefits replacement for 1099 if you’ll replicate them.
Is 1099 net the same as take-home?: This is after modeled taxes/benefits/expenses but before any personal deductions; real take-home varies.
How to handle part-year 1099?: Adjust hours and expenses to reflect the period you’ll contract.

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Simplified comparison. Actual taxes depend on brackets, wage bases, deductions, and state/local rules. Consult a tax professional for detailed advice.