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W2 vs 1099 Employee status
In general  What does this mean? Assume 10 holidays and 2 weeks of vacation. So you will report to the office for 240 days (48 weeks * 5 days a week).  If you are a w2 they will pay you for 260 days (52 weeks * 5 days a week). At $48 per hour you will be paid: 260*8*48 or $99,840. As a 1099 you will be paid 240*8*50 or 96,000. But you still have to cover insurance, the extra part of social security, and your retirement through an IRA. A rule of thumb I have seen with government contracting is that If the employee thinks that they make X,000 per year the company has to bill X/hour to pay for wages, benefits, overhead and profit. If the employee thinks they make x/hour the company has to bill at 2X/hour. When does a small spread make sense: The insurance is covered by another source, your spouse; or government/military retirement program.  Still $2 per hour won't cover the 6.2%  for social security. Let alone the other benefits. The IRS has a checklist to make sure that a 1099 is really a 1099, not just a way for the employer to shift the costs onto the individual.