About this calculator
1099 vs W2 Calculator is a free, independent estimator. It is not affiliated with the IRS. Every federal figure it uses was read from IRS.gov at build time and is listed below with its source page and the date it was checked, so you can verify any number yourself in a couple of minutes.
Tax year used: 2026
The calculator uses tax year 2026 throughout — the year estimated payments made during 2026 are for, and the return filed in early 2027. Brackets and the standard deduction are the IRS inflation adjustments published in Revenue Procedure 2025-32 (announced in IR-2025-103).
Simplified assumptions, stated plainly
- Contractor income is treated as net business profit (after expenses). The QBI deduction is the simplified Section 199A version: 20% of profit after the half-SE-tax deduction, capped at 20% of taxable income before the deduction. Wage/property limits and specified-service rules are not modelled.
- The state field is your own flat-rate assumption, applied to the full amount on both sides. It is not any state's real tax computation.
- The break-even rate matches total value: W-2 net cash plus the benefits value you entered. If you enter $0 of benefits, it matches cash take-home only.
- No credits, no itemised deductions beyond the standard deduction, no capital gains, and no state tax except any flat-rate assumption you set yourself where offered. Real returns differ.
Every figure and its source
Standard deduction, tax year 2026 — $16,100 single and married filing separately, $32,200 married filing jointly, $24,150 head of household
Source: IRS.gov (IRS releases tax inflation adjustments for tax year 2026, IR-2025-103; Revenue Procedure 2025-32), checked 30 Oct 2026
Federal income tax brackets, tax year 2026 — 10% to 37%, thresholds by filing status
Source: IRS.gov (IRS releases tax inflation adjustments for tax year 2026, IR-2025-103; Revenue Procedure 2025-32; cross-checked on Working Families Tax Cuts – Individuals and workers), checked 30 Oct 2026
Self-employment tax rate 15.3% — 12.4% Social Security plus 2.9% Medicare; employer-equivalent half deductible from income
Source: IRS.gov (Self-employment tax (Social Security and Medicare taxes)), checked 30 Oct 2026
Net earnings factor 92.35% — net earnings from self-employment are 92.35% of net profit
Source: IRS.gov (Schedule SE (Form 1040), line 4a; Publication 334), checked 30 Oct 2026
Social Security wage base, tax year 2026 — $184,500
Source: IRS.gov (Topic No. 751, Social Security and Medicare Withholding Rates; Publication 15) and Social Security Administration 2026 fact sheet, checked 30 Oct 2026
Additional Medicare Tax 0.9% — thresholds $200,000 single/head of household, $250,000 joint, $125,000 married filing separately
Source: IRS.gov (Self-employment tax (Social Security and Medicare taxes)), checked 30 Oct 2026
Qualified business income deduction — up to 20% of QBI, Section 199A, with taxable-income limitation
Source: IRS.gov (Qualified business income deduction), checked 30 Oct 2026
Employee FICA — 6.2% Social Security (to the wage base) plus 1.45% Medicare withheld from wages
Source: IRS.gov (Topic No. 751, Social Security and Medicare Withholding Rates), checked 30 Oct 2026
Estimate only — not tax advice. If a figure here ever disagrees with IRS.gov, IRS.gov is right. Tell us and we will fix it.