Texas 1099 vs W2 Calculator

Compare employer cost and worker take-home in Texas, with local income-tax estimates pre-filled.

Pre-filled with Texas estimates: SUI 2.7%, no state income tax. Edit any field below.

Payroll taxes + benefits on W2

Worker's effective rate

Worker's effective rate

Employer cost (per year)

$98,176

W2 fully burdened

$104,000

1099 cost

W2 is cheaper for the employer by $5,824/yr.

Worker take-home (per year)

$66,851

W2 take-home

$77,707

1099 take-home

1099 nets the worker $10,856/yr more. A 1099 rate of about $43.01/hr matches this W2 offer's take-home.

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Estimates only, using editable 2025 US defaults. Tax and insurance rates vary by employer, classification, and locality — verify with a licensed accountant before relying on these figures.

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Comparing a 1099 contract against a W2 role in Texas means weighing employer cost against worker take-home. No state income tax and a low SUI wage base — popular for contract staffing. Because Texas has no wage income tax, the state field starts at 0% — only federal and payroll taxes drive the gap.

Enter the W2 and 1099 rates to see the annual cost to the employer for each, the worker's take-home for each, and the break-even 1099 rate that matches the W2 offer in Texas.

1099 vs W2 in Other States

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Texas 1099 vs W2 FAQ

Is 1099 or W2 better in Texas?
Texas has no state income tax, so the comparison comes down to federal income tax plus the 1099 worker's full 15.3% self-employment tax versus the W2 employee's 7.65% share and employer benefits. The calculator shows both sides for Texas.
What 1099 rate equals a W2 salary in Texas?
Enter the W2 rate and the calculator returns the break-even 1099 hourly rate that nets the same annual take-home in Texas, factoring self-employment tax and the absence of state income tax.
Does Texas state income tax change the math?
Texas has no wage income tax, so the state field is pre-filled at 0%. Only federal income tax and payroll/self-employment taxes drive the difference.
Are these numbers tax advice?
No. They are editable 2025 planning estimates. Effective tax rates depend on income, filing status, and deductions — confirm with a licensed accountant.