Hi EstebanF, thanks for joining the event, and post questions.
There are many differences between a W-2 employee and a self-employed contractor (Form 099-NEC).
One of them is the how the Social Security and Medicare taxes are handled:
1. Social Security tax total 12.4% for a max wage base of $147,000 for 2022 - for a W-2 employee, employee share 6.2%, employer share 6.2%. Self-employed contractor bears all.
2. Medicare tax total 2.9%, no cap. - employee share 1.45%, employer share 1.45%. Self-employed contractor bears all.
A typical billing rate to anticipate the additional self-employment related taxes, using your example would be $50 x 40 hours x 1.0765 (6.2% + 1.45% the self employed contractor extra portion in lieu of employer.)
Enclosed are articles related to the many other difference between the two classifications of employment.
https://quickbooks.intuit.com/r/payroll/1099-vs-w2/
https://turbotax.intuit.com/tax-tips/irs-tax-forms/the-difference-between-a-1099-and-a-w-2-tax-form/...
https://ttlc.intuit.com/community/tax-credits-deductions/discussion/w2-vs-1099-income/00/1771686
https://ttlc.intuit.com/turbotax-support/en-us/help-article/form-1099/employee-independent-contracto...
Hope the above helps. Thank you.
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