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Subject:Re: W2 to 1099 Conversion Rule Of Thumb? From:"Gene Kim-Eng" <techwr -at- genek -dot- com> To:"TECHWR-L" <techwr-l -at- lists -dot- techwr-l -dot- com> Date:Thu, 2 Dec 2004 09:54:16 -0800
There are two separate issues here, one being what hourly
rate you'd need to bring in to equal the same income as a
W2 employee with benefits. The will vary anywhere from
+20% to +50% or more, depending on whether or not you
already have bennies from a "day job" or a spouse, and what
it will cost you to get coverage based on your specific needs
if you have to buy them.
The other, of course, is whether you're going to be able to
get that rate for the job in question.
As far as the tax implications that others have mentioned, this
too varies considerably, depending on whether the contract
in question is going to be your primary income for a significant
portion of the tax year or whether it's just something you're
contemplating doing "on the side." In years I've done 1099
as primary income, it's actually been fairly simple to determine
my taxes just from the IRS workbooks, but I never subcontracted
work out, depreciated equipment or deducted for the business
use of my home; I went strictly for business income minus direct
business expenses on Schedule C and the self-employment tax
minus the 1/2 deduction on the 1040. I may not have squeezed
out every last dime I could have, but my life was a lot simpler,
which under the circumstances at the time was worth something
to me.
Gene Kim-Eng
----- Original Message -----
From: "Tony Markos" <ajmarkos -at- yahoo -dot- com>
> Can anyone give me a "rule of thumb" for coverting a
> W2 hourly rate to an equivalent 1099 hourly rate?
>
> This is for a local TW contract job that I am
> considering, so there are no per diem considerations
> (if that makes any difference).
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