🗂️ W2 vs 1099 vs C2C Comparison Calculator
Same pay rate, same bill rate, but your gross profit changes with the classification because the employer burden is different: W2 carries the full load of taxes and insurance, while 1099 and C2C shift most of it to the worker or their corp. This tab from Dee's How To Charge workbook shows the real cost difference side by side, and pairs it with the workbook's plain warning: 1099 misclassification is illegal, and the compliance risk can wipe out the extra profit overnight.
Your rates
Same pay rate, same bill rate, three classifications. Your gross profit changes because your employer burden is different for each model.
What you pay the worker per hour, regardless of classification.
What the client pays you per hour.
Burden % by model
Full employer burden: payroll taxes, workers comp, insurance. Defaults to the master workbook's Burden Builder total (21.55%); build YOUR number with the Burden Builder calculator and its state dropdown.
Light: mostly admin and insurance. The worker covers their own taxes.
Lowest: you contract with the worker's corp, not the person.
Estimates for planning, not financial or legal advice. The numbers are illustrations built from your inputs; your market, your state, and your carrier decide the real ones.
Does this resonate?
Classify with confidence, then go fill the order.
The platform's staffing roadmap covers compliant onboarding paperwork for W2 and contractor engagements, so classification never becomes the thing that sinks the agency.
Build my launch plan free →Good questions about this math
Why is W2 more expensive for the agency?
Because YOU pay the employer taxes and insurance: Social Security, Medicare, unemployment, workers comp, and any benefits. On a $30 pay rate at a 21.55% burden that is about $6.47 per hour off your spread. 1099 and C2C shift most of those costs to the worker or their corporation.
When can a worker legally be 1099?
When the worker controls HOW the work gets done; you set the deliverable, not the process. If you control when, where, and how they work, they are W2 by law. The IRS, DOL, and state agencies enforce this aggressively, with back taxes, fines, and lawsuits for getting it wrong. Consult an employment attorney before classifying.
What is Corp-to-Corp (C2C)?
The worker has their own LLC or S-Corp and you contract with their company, not with them personally. It carries the lowest burden of the three but the most administrative setup, and the worker must genuinely operate as a business.
If 1099 and C2C are more profitable, why staff W2?
The workbook's answer: because the compliance risk can wipe out the extra profit overnight. Most contract staffing is W2 by nature of the control involved. Price the W2 model correctly using your real burden and you will sleep better; save 1099 and C2C for workers who genuinely qualify.
Do I get the Excel version?
Yes. The $27 one-time unlock includes the standalone W2 vs 1099 vs C2C workbook with every formula live plus the START HERE guide tab.
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