What's the actual take-home pay difference between 1099 and W-2 at the same gross pay?

At identical gross pay, a 1099 worker's take-home is lower than a W-2 employee's, because the 1099 worker pays the full 15.3% self-employment tax rather than the 7.65% FICA share a W-2 employee pays (with the employer picking up the matching 7.65%). The exact dollar gap depends on your income level, since both the self-employment tax rate and the federal income tax brackets change as pay rises.

Is 1099 or W-2 better for me?

There's no universal answer — it depends on how much a 1099 rate is uplifted over the equivalent W-2 salary, whether you value guaranteed benefits (health insurance, employer 401(k) match, paid leave) over higher gross pay, and your tolerance for inconsistent income. This calculator's job is to make the trade-off visible in real after-tax dollars for your specific numbers rather than a generic answer.

How much more do you make on 1099 versus W-2?

You don't automatically make more as a 1099 worker at the same gross pay — you make less after tax, because you're covering the full 15.3% self-employment tax yourself instead of splitting it with an employer as a 6.2%/6.2% Social Security plus 1.45%/1.45% Medicare match. A 1099 rate only comes out ahead once it's set high enough to cover that gap plus lost benefits, which is the real question this comparison answers.

What is the federal tax difference between 1099 and W-2 income?

Federal income tax itself is calculated the same way for both — the same 2026 brackets and $16,100 standard deduction apply regardless of classification. The real difference is in FICA: a W-2 employee pays 7.65% (with an employer match), while a 1099 worker pays the full 15.3% self-employment tax on their net earnings, up to the $184,500 Social Security wage base.

Why do most online 1099 vs W-2 calculators give different answers?

Many use a flat percentage assumption for self-employment tax and expenses rather than applying real 2026 tax brackets, or they ignore the Social Security wage base cutoff, the Additional Medicare Tax above $200,000, or state tax entirely. This calculator applies the actual 2026 federal bracket and FICA/SE-tax mechanics rather than a rule-of-thumb multiplier, though it is still federal-only — your state's income tax adds another layer on both sides equally.

1099 vs W-2 Calculator 2026 | Compare Take-Home Pay

1099 vs W-2: Comparing Take-Home Pay at the Same Gross Pay

Search for a 1099 vs W-2 calculator and most of what comes up is either a two-way comparison with no real tax math behind it, or a law-firm blog explaining the difference in words only. This calculator puts real 2026 numbers behind both sides — federal income tax, FICA, and self-employment tax — so you can see exactly what the same gross pay is worth as a W-2 employee versus a 1099 contractor.

The gap comes down to two things: who pays the Social Security and Medicare tax, and who absorbs the cost of benefits. As a W-2 employee, you pay 7.65% FICA and your employer pays a matching 7.65% on your behalf (plus benefits, in many cases). As a 1099 contractor at the identical gross pay, you owe the full 15.3% self-employment tax yourself, and any benefits come out of your own pocket — which is exactly why a 1099 rate needs to be higher than a W-2 salary to leave you in the same after-tax position.

How the comparison is built

Enter one gross figure — an annual salary or an hourly/day rate multiplied out to an annual equivalent
The W-2 side applies 2026 federal income tax brackets plus 7.65% employee FICA (6.2% Social Security up to the $184,500 wage base, 1.45% Medicare)
The 1099 side applies the same federal income tax brackets plus the full 15.3% self-employment tax up to the same $184,500 threshold, dropping to 2.9% above it
Both sides pick up the 0.9% Additional Medicare Tax once earnings pass $200,000
The difference in take-home pay is the real cost of self-employment tax and lost benefits at your income level — not a generic 25-40% rule-of-thumb markup

1099 vs W-2 Calculator