1099 vs W-2 Calculator
Turn a 1099 contract rate into the W-2 salary that takes home the same, after self-employment tax, the QBI deduction and 2026 federal brackets.
Updated · By Niraj Kumar · 3 sources
https://checkpre.com/finance/1099-vs-w2-calculator
Your rate
Leave out holidays and gaps between clients.
Equipment, software, coworking, accountant, bank and payment fees.
Tax setup
1099 sole proprietor. Self-employment tax of 15.3% on 92.35% of profit, half of it deductible, plus the 20% QBI deduction.
0 in Texas, Florida, Washington and other no-tax states; roughly 4-7% at typical incomes in California and New York.
- Equivalent W-2 salary
- $128,732
- The salary an employee needs to take home the same; $61.89 an hour over 2,080 paid hours
- Tax and social contributions
- 23% of revenue
- 29% of each extra dollar you bill
- Revenue
- $138,000
- 1840 billable hours
- Take-home72%
- Social contributions13%
- Income tax10%
- Business costs5%
Where the money goes, a year
- Revenue
- $138,000
- Business costs
- −$6,900
- Social Security (SE tax)
- −$15,013
- Medicare (SE tax)
- −$3,511
- Federal income tax
- −$13,322
- Take-home
- $99,254
- Single filer with the standard deduction. State income tax is entered as an effective rate.
- Health insurance premiums and SEP-IRA or Solo 401(k) contributions would lower the income tax further.
- The QBI deduction phases out between $201,750 and $276,750 of taxable income for a consultant with no employees.
The same $75/hour in 15 countriesShowHide
| Country | Take-home, local | In USD | PPP $ | Tax + social |
|---|---|---|---|---|
| IndiaPresumptive, section 44ADA | ₹10,788,405 | $112,426 | $543,800 | 14% |
| Philippines8% flat rate | ₱6,739,922 | $107,409 | $328,240 | 17% |
| RomaniaPFA (real system) | RON 499,735 | $107,628 | $229,180 | 17% |
| BrazilPJ on Simples Nacional (Anexo III) | R$586,795 | $113,264 | $227,309 | 13% |
| MexicoRESICO (régimen simplificado de confianza) | MX$2,256,738 | $128,340 | $199,556 | 2.0% |
| PolandRyczałt 12% (IT services) | PLN 404,174 | $104,836 | $195,901 | 19% |
| ColombiaTrabajador independiente | COP 293,739,053 | $89,983 | $176,357 | 30% |
| SpainAutónomo (estimación directa) | €70,593 | $80,243 | $116,134 | 37% |
| PortugalTrabalhador independente (simplified regime) | €66,187 | $75,235 | $115,166 | 40% |
| United States1099 sole proprietor | $99,254 | $99,254 | $99,254 | 23% |
| United KingdomSole trader | £68,831 | $90,991 | $98,115 | 29% |
| CanadaSole proprietor (Ontario) | CA$121,750 | $86,243 | $96,590 | 33% |
| NetherlandsZZP'er (eenmanszaak) | €73,374 | $83,404 | $95,621 | 35% |
| GermanyFreiberufler (voluntary GKV) | €67,761 | $77,024 | $94,258 | 39% |
| AustraliaSole trader | A$132,741 | $93,272 | $90,633 | 27% |
How is freelance income taxed in the US?
Revenue = Rate × Hours × Weeks × FX, Take-home = Revenue − Expenses − Social − Tax, Salary* : Net_employee(Salary*) = Take-home, PPP $ = Take-home ÷ PPPThis page uses the same method as the Freelance Hourly Rate to Salary Calculator, which explains each term and assumption in full.
Worked example
A freelancer in the US bills a US client $75 an hour for 40 hours a week, 46 weeks a year, with 5% in business costs, as a 1099 sole proprietor.
- 1Revenue: $75 × 40 × 46 = $138,000
- 2Social contributions: $18,524; income tax: $13,322; together 23% of revenue
- 3Take-home after $6,900 of costs: $99,254 a year, $8,271 a month
- 4An employee in the US would need to earn $128,732 (W-2 salary) to take home the same
$75 an hour is worth about the same as a $128,732 W-2 salary in the US.
Frequently asked questions
How much tax does a freelancer pay in the US in 2026?
On $75 an hour ($138,000 a year), about 23% of revenue goes to social contributions and income tax as a 1099 sole proprietor, leaving $99,254 after 5% of costs. Self-employment tax of 15.3% on 92.35% of profit, half of it deductible, plus the 20% QBI deduction.
How much more should a 1099 contractor charge than a W-2 employee earns?
On taxes alone, a 1099 contractor pays the employer's half of Social Security and Medicare, 7.65% of 92.35% of profit, partly offset by deducting half of it and by the 20% QBI deduction. The bigger gaps are unpaid time off, health insurance and the 401(k) match. Once those are counted, contract rates of 1.3 to 1.5 times a salary's hourly equivalent (salary ÷ 2,080) are typical.
What is self-employment tax in 2026?
15.3% on 92.35% of net self-employment earnings: 12.4% for Social Security on the first $184,500 and 2.9% for Medicare with no cap, plus 0.9% Additional Medicare Tax above $200,000 for a single filer. Half of the 15.3% is deducted in arriving at adjusted gross income.
Does the QBI deduction apply to freelance developers and consultants?
Yes, up to 20% of qualified business income, limited to 20% of taxable income. Consulting is a specified service business, so for 2026 the deduction phases out between $201,750 and $276,750 of taxable income for a single filer. Below $201,750 every freelancer gets it in full.
Do clients abroad withhold tax from a freelancer in the US?
A US client pays a US contractor gross and files a 1099-NEC; nothing is withheld, so you pay quarterly estimated tax on Form 1040-ES.
Sources
Related calculators
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