US contractor planning tool
W-2 vs 1099 calculator
Compare the employee payroll taxes on a W-2 salary with the self-employment tax on 1099 net profit, before federal and state income tax.
Enter business expenses only, not personal spending. This calculator compares payroll-related tax; it does not estimate federal or state income tax.
1099 amount left after business expenses and self-employment tax
$72,989.88
- 1099 revenue
- $95,000.00
- Business expenses
- −$10,000.00
- 1099 net profit
- $85,000.00
- Self-employment tax
- −$12,010.12
- W-2 employee FICA on salary
- −$4,972.50
Payroll-tax-only difference versus the W-2 salary: +$12,962.38
Set aside at least $3,002.53 per quarter for self-employment tax alone. Income tax, health insurance, paid leave, retirement contributions, employer benefits, state tax and local tax can materially change the comparison.
Why the 1099 number is different
Employees generally pay half of Social Security and Medicare payroll tax through FICA. Independent contractors generally calculate self-employment tax on 92.35% of their net profit and can deduct half of that tax when calculating adjusted gross income. This tool shows that payroll-tax difference, not a complete tax return.
Based on IRS Topic no. 554 on self-employment tax and IRS Publication 505's 2026 estimated-tax worksheet.