W-2 vs 1099 Calculator
Compare a specific salaried W-2 job offer against an hourly 1099 contract rate to see which role provides greater net income and determine the exact equivalent contract rate.
Salaried Offer vs Hourly Contract Offer
Financial Winner
1099 Offer
+$29,000 net advantage
W-2 Net Take-Home
$66,300
Total Comp: $100,000
1099 Net Take-Home
$95,300
Gross: $124,800
Break-Even 1099 Rate
$60.03/hr
To equal W-2 package
Step-by-Step Worked Example
Calculation Steps:
How to Use This Calculator
- 1Enter the W-2 annual base salary and estimated annual value of benefits.
- 2Enter the proposed 1099 contract hourly rate and projected annual hours.
- 3Input estimated annual contractor business expenses and private health/retirement costs.
- 4Review side-by-side net take-home comparison and the exact 1099 break-even rate.
Assumptions & Limitations
- Estimates are based on standard national averages and current prevailing construction materials and contractor rates.
- Actual trade bids may fluctuate according to local building code requirements, permit fees, and site topography.
- Always obtain multiple written bids from licensed, bonded, and insured contractors before commencing work.
Frequently Asked Questions
How many billable hours are in a typical year of full-time contracting?
Full-time contracting typically spans 1,800 to 1,920 billable hours per year, reflecting 45 to 48 working weeks at 40 hours per week (accounting for unpaid holidays, vacations, and sick days).
What benefits are lost when moving from W-2 to 1099?
Contractors lose employer-subsidized health/dental insurance, 401(k) matching, paid vacation and sick leave, employer-paid workers compensation, and state unemployment insurance eligibility.
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