1099 vs W-2 Calculator
A $100/hour contract can pay more or less than a $200,000 salary — the answer is taxes and deductions. This calculator nets out both sides: W-2 income tax plus half FICA, versus 1099 self-employment tax plus income tax after your business expenses.
How to use this calculator
- Enter gross income (salary or contract pay).
- Enter business expenses (1099 only).
- Enter filing status.
- Your results appear instantly below and update as you change the numbers.
How this calculator works
The W-2 side pays income tax plus the employee's 7.65% FICA share (the employer silently pays the other half). The 1099 side pays income tax plus the full 15.3% self-employment tax — but starts from profit after business expenses and gets deductions the W-2 side lacks: the 20% QBI deduction, home office, mileage, and a solo 401(k) or SEP IRA that can shelter far more.
Frequently asked questions
Which one usually pays more?
At identical gross income, the W-2 job nets more — roughly 7.65% of the employer's FICA share plus the 20% QBI difference. But contractors often earn more per hour and have deductions that shrink taxable profit, which is why the comparison rarely stops at the gross number.
How do benefits factor in?
Health insurance, 401(k) match, paid time off, and payroll taxes paid by the employer are real compensation. Add them to the W-2 side, or count what you must buy yourself (insurance, equipment, software) as 1099 expenses.
Can I have both?
Yes — many people hold a W-2 job and freelance on the side. The side income is 1099 (self-employment tax applies to it), which is exactly the case the side hustle tax calculator covers.
Disclaimer: Results are estimates for general information only and do not constitute financial, tax, or legal advice. Figures reflect 2026 rules and may change. Always confirm current limits and consult a qualified professional before making decisions. Official figures: IRS.gov · 2026 limits per IRS tax inflation adjustments.