Translate a contractor rate into the equivalent employee salary.
Open the 1099 Contract vs W-2 Salary tool →A contractor rate and a salary look comparable but aren't. As a W-2 employee, your employer quietly pays half of your Social Security and Medicare (about 7.65% of your wages) and often covers benefits like health insurance, retirement matching, and paid time off. As a 1099 contractor you pay all of that yourself: both halves of FICA via self-employment tax, and every benefit out of pocket.
So we take your contractor gross (rate × billable hours), subtract the employer-side FICA an employer would otherwise have paid, and subtract the benefits you have to self-fund, to land on the rough W-2 salary your contract is worth. Flip it the other way and it shows why contractors typically charge well above a salaried worker's hourly wage.
This is a rule-of-thumb comparison to weigh an offer, not an exact, take-home-equalizing tax calculation; for your real tax, use the Quarterly Taxes tool. Filing status flows to and from My Situation.
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