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ping7680
New Member

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.

 
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Zbucklyo
Level 9

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.

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.

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4 Replies
Zbucklyo
Level 9

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.

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
New Member

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.

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
Level 9

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.

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
New Member

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.

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