Part of your federal taxes are used to fund government benefits programs like Social Security and Medicare under the FICA tax. For W2 employees, the tax is split equally between employers and employees at 7.65% each. On the other hand, 1099 workers are required to pay the entire 15.3% FICA tax themselves.
Why are my taxes higher with a 1099 than a W2?
Why there is a different tax rate for contractors and freelancers than there is traditional employees
Written by Kristen Tyrrell
Updated over a week ago
Updated over a week ago