Contractor vs Employee Break-Even Calculator
What hourly rate do you need as a contractor to match your W-2 salary and benefits? Enter your employer's exact package and contractor expenses to see your personal break-even rate and the premium above salary you need.
This is not W-2 vs 1099 comparison: This tool answers a specific question: "Given my exact employer's benefits package, what hourly rate do I need as a contractor to match my current compensation?"
Current W-2 situation
Contractor expenses
Billable hours
Effective billable hours: 1720 hrs/yr (1800 − 2 vacation weeks × 40)
W-2 compensation stack
Contractor premium breakdown
You need $65.82/hr to match your $80,000 salary
That is $33,219 more than your salary (41.5% premium) to cover the employer FICA share, benefits you lose, and business expenses you now fund. Any rate above $65.82/hr is upside.
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