All Collections
Setting Up Tax Withholding
Why are my taxes higher with a 1099 than a W2?
Why are my taxes higher with a 1099 than a W2?
Jess avatar
Written by Jess
Updated over a week ago

There is a different tax rate for contractors and freelancers than for traditional W2 employees.

That's because W2 employees split FICA tax (which funds programs like Social Security and Medicare) with their employer. Each pays 7.65%.

1099 workers, by contrast, are responsible for paying FICA tax (which totals 15.3%) by themselves.

Did this answer your question?