1099 vs W-2 Calculator 2025
A $130K contract isn't the same as a $130K salary. Enter both offers — see the real after-tax, after-benefits comparison in seconds.
Data sources: IRS Rev. Proc. 2024-40 · IRS Topic 554 (SE Tax)
Sample: $100K W-2 vs $130K 1099
W-2 Job
$100,000
1099 Contract
$130,000
Break-even 1099 rate
$124,500
minimum to match W-2 take-home
Your Tax Situation
Full-Time Employee Offer
What your employer pays toward your health insurance each month
Freelance / Contract Offer
Individual market / COBRA cost you pay out-of-pocket
SEP-IRA or Solo 401(k) contribution
Enter both offers above
Fill in your W-2 salary and 1099 contract details, then click Compare to see which one puts more money in your pocket.
How the comparison works
Tax burden difference
W-2 employees pay 7.65% FICA (employer pays the other 7.65%). 1099 contractors pay the full 15.3% self-employment tax — but can deduct 50% of it from their AGI. We apply 2025 IRS brackets to both scenarios.
Benefits valuation
Employer health insurance, 401(k) match, and paid vacation have real dollar value. We calculate exactly what your employer contributes — and what you'd need to pay yourself as a contractor.
Break-even rate
We solve for the exact 1099 gross income needed for your net pay to match the W-2 offer. This is the number to take into your rate negotiation.
Why a $100K contract is worth less than a $100K salary
| Cost | W-2 ($100K) | 1099 ($100K) |
|---|---|---|
| Gross income | $100,000 | $100,000 |
| FICA / SE tax | -$7,650 (7.65%) | -$14,130 (15.3% on 92.35%) |
| Federal income tax | ~-$12,600 | ~-$11,800 (SE deduction helps) |
| Health insurance | $0 (employer pays ~$6,000/yr) | ~-$6,000 (you pay) |
| Retirement match | +$3,000 (3% employer match) | $0 |
| PTO (15 days) | +$5,769 in paid leave | $0 (unpaid time off) |
| Net spendable | ~$79,750 | ~$68,070 |
| Difference | — | -$11,680 vs W-2 |
* Illustrative figures. State taxes not included. Use the calculator above for your exact scenario.
Contract vs Salary Calculator — Which Offer Actually Pays More?
This tool doubles as a contract vs salary calculator. Enter a W-2 salary offer on one side and a contract rate on the other — and see which one puts more money in your pocket after every tax and benefit is factored in. Stop guessing. Negotiate from real numbers.
Job offer decisions
Comparing a $120K salary with a $150K contract role? Enter both and see the real after-tax difference before you decide.
Negotiating a raise
Converting from W-2 to contractor at your current company? Know the exact rate you need to maintain the same take-home pay.
Going full-time freelance
Thinking about leaving a salaried job? Calculate your exact break-even contract rate before you make the leap.
Evaluating benefits packages
Health insurance, 401k match, and PTO all have real dollar value. This calculator makes that value visible.
Frequently asked questions
Learn More
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