Contractor rate vs employee salary calculator
A 1099 rate has to cover more than a W-2 salary: the employer's own FICA match, any benefits and paid time off you would give up, and the self-employment tax a client never pays on your behalf. This prices the rate that actually matches, and runs the same arithmetic backward from a rate to the salary it equals.
Worked example — 1099 rate that matches a $110,000 salary with $14,000 of benefits: $90.71/hr. 1,700 billable hours a year, no paid time off assumed
Price your own rate, either direction
Enter a W-2 salary to solve for the 1099 rate that replaces it, or flip the toggle and enter a 1099 rate to solve for the salary it matches. Benefits, paid time off and billable hours are all yours to set: none of them is assumed on your behalf.
$110k salary, $14k benefits, 1,700 hours: A $110,000 salary with $14,000 of benefits, billing 1,700 of the year's 2,080 hours.
Advanced 1
Only matters if you also drew a W-2 paycheque this same year. It shrinks the Social Security wage base room left for the self-employment side, since the two are capped together, not separately.
| Billable hours | Required 1099 rate |
|---|---|
| 1,200 | $128.50/hr |
| 1,400 | $110.15/hr |
| 1,600 | $96.38/hr |
| 1,800 | $85.67/hr |
| 2,000 | $77.10/hr |
What 1099 rate matches a $110,000 salary
$90.71 an hour, billing 1,700 hours a year, to match a $110,000 W-2 salary with $14,000 of benefits and no paid time off counted. That breaks down to $8,415 of employer FICA match the salary alone does not show, grossed up by $21,788 of self-employment tax the contractor has to fund out of their own invoice. The $110,000 salary alone is $52.88 an hour at the standard 2,080-hour convention, so the 1099 figure runs 1.72x higher, not the flat 1.3x a rule of thumb would apply regardless of the benefits, hours, or income level involved.
Strip the benefits out and the multiple falls: a $75,000 salary with no benefits, billing 1,800 hours, matches $52.23 an hour, only 1.45x the salary-only rate of $36.06. The multiple is not a constant; it moves with how much of the package is benefits versus cash and how few hours the year gets billed.
Required 1099 rate by salary and billable hours
No benefits and no paid time off counted in this table, so it reads as the floor: add your own benefits value and PTO days in the calculator above to see the real number rise from here. Read down a column for how fewer billable hours push the same annual cost onto fewer paid hours, and across a row for how the required rate scales with salary.
| W-2 salary | 1,600 hours | 1,700 hours | 1,800 hours | 2,000 hours |
|---|---|---|---|---|
| $60,000 | $47.01/hr | $44.25/hr | $41.79/hr | $37.61/hr |
| $80,000 | $62.68/hr | $58.99/hr | $55.72/hr | $50.15/hr |
| $100,000 | $78.35/hr | $73.74/hr | $69.65/hr | $62.68/hr |
| $120,000 | $94.02/hr | $88.49/hr | $83.58/hr | $75.22/hr |
| $150,000 | $117.53/hr | $110.61/hr | $104.47/hr | $94.02/hr |
Every cell is the salary plus the employer's own FICA match, grossed up for the contractor's self-employment tax, divided by that column's billable hours. None of it is interpolated: each cell is its own run of the calculator above.
W-2 total compensation vs 1099 gross at the same take-home
Both totals below land on the same number by construction: what it costs to provide a $110,000 salary with $14,000 of benefits is exactly what a contractor's 1099 gross needs to leave over after their own self-employment tax.
| Salary | $110,000 |
| Employer FICA match | $8,415 |
| Benefits | $14,000 |
| Total cost to employ | $132,415 |
| Gross invoiced a year | $154,203 |
| Self-employment tax owed | -$21,788 |
| Net after self-employment tax | $132,415 |
Both totals match to the cent: $132,415 on each side. That equality is what the gross-up solves for, not a coincidence, which is why the 1099 side needs a higher headline number than the salary side even though both represent the identical package. What is not in either total: income tax, and any business expenses a real contractor would deduct before their self-employment tax is calculated.
Why self-employment tax is not simply double FICA
The self-employment rate genuinely is double the FICA rate: 15.3% combined, against the 7.65% an employee and an employer each pay separately, 6.2% Social Security and 1.45% Medicare on each side. What is not double is what a rule-of-thumb calculator gets wrong applying that rate to: self-employment tax only applies to 92.35% of net earnings, not the full amount. On $154,203 of gross invoiced income, applying 15.3% straight to the whole figure would charge $23,593, but the actual tax is $21,788, a difference of $1,805 that the flat-rate shortcut simply gives away.
The two halves also cap differently. Only the 12.4% Social Security slice stops at the wage base, $184,500 for 2026, and that room is shared with any W-2 wages already earned the same year, not a separate allowance for the 1099 side. The 2.9% Medicare slice never caps at all. A contractor who also holds a W-2 job earning at or above the wage base owes no self-employment Social Security tax at all on their 1099 income, only the uncapped Medicare share, which the calculator's advanced input models directly.
Where these numbers come from
The tax rates here are set by statute and do not change year to year. The one figure that does, the Social Security wage base, is published annually by the Social Security Administration and cross-checked here against a second, independent report of the same release on 08/08/2026.
- American Payroll Association: 2026 Social Security wage base $184,500 taxable maximum for 2026, reporting the SSA release directly (ssa.gov itself blocks automated fetches)
- The Tax Adviser: Social Security wage base and COLA for 2026 Second, independent report of the same $184,500 figure
- IRS: self-employment tax (Social Security and Medicare taxes) The 15.3% combined rate and the 92.35% net earnings factor, 26 U.S.C. 1401 and 1402(a)
- IRS: understanding employment taxes The 6.2%/1.45% employer and employee FICA shares, 26 U.S.C. 3101 and 3111
This is general publishing, not tax advice. It matches total compensation cost, not take-home pay: income tax is left out of both sides on purpose so it cannot tilt the comparison, and it assumes no deductible business expenses on the self-employment side. State tax, benefits shopping on the individual market, and quarterly estimated-tax cash-flow timing are all real costs a working contractor should also account for and are outside what this page prices. Re-check the wage base every January, when the Social Security Administration publishes the following year's figure.
The next question after this one
Hourly to salary calculatorCalculatorOnce a rate is set, this converts it into every other pay frequency a contract might state instead.Open nextOther questions
- Real hourly wage calculatorCalculatorThe mirror question: what a W-2 job actually pays per hour once commute time and unpaid overtime are counted, the same honesty this tool applies to the FICA math.
- PTO payout calculatorCalculatorPuts a dollar figure on what a W-2 job's paid time off is actually worth, the same figure this tool asks for as an input.
All 130 calculatorsHow JMM sources and checks its numbersWhat stays free, and what early access would add
More calculators for the same paycheque
The hourly-to-salary calculator turns any rate this page produces into every other pay frequency, and the real hourly wage calculator prices what a W-2 job actually nets once commute time and unpaid hours are counted against it.