Contractor vs Employee Cost Calculator
See what a W-2 employee really costs once you add payroll taxes, benefits, and overhead, then compare it side by side with a 1099 contractor.
Compare your costs
Employer payroll taxes, benefits, insurance, equipment, and paid time off as a percentage of salary. 25 to 40 percent is typical.
Estimates only. Overhead and tax rates vary by location and business.
How it works
Three inputs reveal the real gap between hiring an employee and a contractor.
Enter the base salary
Start with the gross annual salary you would pay a W-2 employee before any extras.
Add your overhead rate
Layer on payroll taxes, benefits, insurance, equipment, and paid time off as a percentage of salary.
Compare the contractor
Enter what the contractor charges per year and see the true cost difference between the two.
Frequently Asked Questions
Common questions about contractor and employee costs.
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