Enter the W2 salary you want to match and get a minimum viable contractor hourly rate — with a full cost breakdown and annual earnings projections.
To match a $100,000 W2 salary as a contractor, you need to charge at least $68–$75/hr — after self-employment tax (15.3%), health insurance, and unbillable weeks.
When a company pays you as a W2 employee, they absorb costs you never see: the employer half of FICA taxes (7.65%), health insurance premiums, 401k matches, workers compensation, and equipment. These can add 25–40% to your effective cost to the employer beyond your salary.
As a contractor you pay all of this yourself. Self-employment tax alone is 15.3% of net earnings (the full FICA rate, both employee and employer share). Add health insurance, a laptop refresh cycle, software subscriptions, and a solo 401k, and the overhead is easily 35–40% on top of your target take-home.
| W2 target salary | Min rate | Recommended rate | Annual at 49 wks |
|---|---|---|---|
| $60,000 | $45/hr | $51/hr | $99k |
| $80,000 | $59/hr | $68/hr | $132k |
| $100,000 | $74/hr | $85/hr | $165k |
| $120,000 | $89/hr | $102/hr | $198k |
| $150,000 | $111/hr | $127/hr | $248k |
| $180,000 | $133/hr | $152/hr | $298k |
| $200,000 | $147/hr | $169/hr | $331k |
Assumes 1.25× overhead (SE tax + equipment) and 1.15× benefits premium. Recommended rate adds 15% buffer. 49 billable weeks/year.
Estimates only — not financial or tax advice. Self-employment tax rates, deduction eligibility, and benefits costs vary by jurisdiction and situation. Consult a tax professional. Methodology: About TimeSync Tools.