Compare your take-home pay as a 1099 contractor vs a W-2 employee at the same gross income. See where the money goes — and which path leaves more in your pocket.
Same gross income, different tax treatment. Here's why the numbers diverge.
1099 gives you more deductions (business expenses, QBI, retirement), but you pay the full 15.3% SE tax on top of income tax. The break-even depends heavily on:
Most freelancers gross 25-40% more as 1099 to break even on benefits and tax differences. Use this calculator as a starting point, then add the value of benefits you'd lose.
A side-by-side breakdown of how the two paths differ across taxes, benefits, and deductions.
For a deeper dive on the math, see our 1099 vs W-2 take-home article.
W-2: ~$63,000 take-home. 1099: ~$60,500 take-home. W-2 wins by ~$2,500/year because there's no state tax to advantage 1099, no business expenses to deduct, and SE tax is the dominant difference.
W-2: ~$63,000. 1099: ~$64,500. 1099 wins by ~$1,500/year — business expenses + QBI tip the balance.
W-2: ~$103,000. 1099: ~$108,000. 1099 wins by ~$5,000/year — high state rate amplifies deduction value, business expenses are substantial, QBI applies cleanly.
W-2: ~$163,000. 1099: ~$167,000. 1099 wins by ~$4,000/year — Social Security cap helps 1099, big expenses + QBI offset the SE tax.
Bottom line: 1099 usually wins for freelancers with real business expenses ($10k+) in moderate-to-high-tax states. W-2 wins for low-income or no-expense roles. This calculator gives you the math; the rest is the value of benefits, paid time off, and stability.