Contractor vs. Employee True Cost

A $75,000 employee costs far more than $75,000 once you add employer taxes, benefits, equipment, and overhead. Conversely, a contractor paying their own taxes and benefits requires a higher rate. This tool reveals the true all-in cost of both options so you can make an apples-to-apples hiring decision.

Employee Annual Salary ($)

Contractor Annual Rate ($)

Employee Add-On Costs

Health Insurance ($/yr)

401(k) Match ($/yr)

Workers Comp Rate (%)

State Unemployment Rate (%)

Office / Equipment ($/yr)

PTO / Paid Holidays (days)

W-2 Employee

Base Salary

Employer FICA (7.65%)

FUTA (0.6%)

SUTA

Health Insurance

401(k) Match

Workers Comp

Office/Equipment

PTO Cost

Total Annual Cost

1099 Contractor

Contract Rate

Employer Taxes$0

Benefits$0

Workers Comp$0

Equipment/Office

Agency/Platform Fee

Total Annual Cost