1099 vs W-2 Take-Home Calculator

Is that contract offer actually a raise? Compare the same gross pay as a 1099 contractor vs a W-2 employee — in plain English. Nothing leaves your browser: all calculations happen on your device.

⚠️ Estimate only — not tax advice. This uses 2026 federal figures and ignores state tax, benefits (health insurance, 401k match, PTO), and business expenses. Talk to a tax professional before making decisions.

📋 1099 contractor

$76,872 / yr take-home
  • Self-employment tax$14,695
  • Federal income tax$12,434
  • Effective tax rate26.1%

🏢 W-2 employee

$81,994 / yr take-home
  • Employee FICA$7,956
  • Federal income tax$14,050
  • Effective tax rate21.2%
$5,122/year more as a W-2 employee. A contract offer at this gross pay would need to be about $110,930 to match the employee take-home — and that’s before benefits.
Show the math

Federal income tax uses the 2026 brackets on (gross − standard deduction). As a 1099 contractor you pay both halves of payroll tax: 15.3% self-employment tax on 92.35% of net earnings (12.4% Social Security up to the $184,500 wage base + 2.9% Medicare, plus 0.9% over $200k/$250k) — but half of it is deductible, which lowers your income tax. As a W-2 employee you pay 7.65% FICA (your employer quietly pays the other half). That’s the whole gap: the extra half of payroll tax, partly offset by the deduction. State taxes, benefits, and business expenses aren’t included.

The rule of thumb this confirms: a contract rate needs to be roughly 15–25% higher than the equivalent salary to leave you even — before you factor in health insurance, retirement matching, and paid time off, which employees get and contractors don’t.

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