Should I go with an hourly W2 wage at $75/hr, or at 1099 wage at $85/hr. This is assuming a regular 40hr work week and minimal deductions because I have no overhead.

[Zbucklyo · Accepted solution]

Not a tax question, but factoring in vacation time and the employer portion of social security and medicare payments alone, the W-2 job seems like a no-brainer, especially if there are other benefits like health and disability insurance, or employer 401 (k) matches.

[ping7680]

Need to add detail. The W2 position has no benefits (health, 401k). I'm purely asking in terms of tax difference per social security and medicare.

[Zbucklyo]

Then, you lose net of slightly less than 6% of your income from having to pay the employer portion of medicare and social security tax (it is not 7.65% because you don't pay self-employment tax on all your self-employment income, and you get a deduction for half your self-employment tax).

[ping7680]

1099 it is then. Thanks a ton, appreciate the help!