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Freelance Rate Calculator
What do you need to bill to keep the same cash flow as your W-2? Enter what the job paid and what running your business costs, and we'll find the rate that leaves you the same amount to use personally.
1What your old job paid
Count everything the job bundled in. To keep the same cash flow on your own, your rate has to cover all of it.
or target income
what you'd pay
employer match you'd lose
as much as you like, it's your call now
2Your working year
This is where freelancing pays off: nobody hands you a 9-to-5 anymore. You design your own year. Want six weeks off? A four-day week? Set it here, and your rate adjusts so your income doesn't.
all work, billable or not
you choose how many
software, equipment, insurance: what the job used to pay for
Part of your week goes to running your business: meeting new clients, sending proposals, building your name. Pick a scenario to see your rate at each stage: most freelancers start around 60% and grow toward 90% as clients start coming to them.
Your floor rate
$102/hour
$816 day rate · at 75% billable (1,440 hrs/yr)
Charge this and, after self-employment tax and business costs, you keep the same cash flow your W-2 gave you. Everything above it is upside.
Salary
$110,000
Health insurance
$6,600
401(k) match
$4,400
Paid time off
20 days
$8,462
Total old compensation
$129,462
Employee FICA (already withheld)
-$8,415
Cash flow to match
what's left for you to use personally
$121,047
Self-employment tax
+$19,917
Business expenses
+$6,000
Revenue you need to bill
$146,964
Your S Corp opportunity
An S Corp election could lower the self-employment tax in this rate. Whether it is worth it turns on your profit, which the tax savings calculator works out.
Work out your S Corp savingsWant to compare the two paths side by side, at the revenue you already have?
Compare W-2 vs 1099 vs S CorpThe math behind your potential savings
As a sole proprietor or single-member LLC, self-employment tax applies to every dollar of profit. With an S Corp, you split your income into two parts, a reasonable salary and owner distributions. Payroll taxes apply only to the salary.
Assumes a 260-day working year and an 8-hour working day for the day rate math. Your actual calendar may differ, adjust the working hours and weeks above to match it.
Estimates for educational purposes, not tax, legal, or financial advice.
This calculator is intended solely for illustrative purposes and may not accurately reflect your unique circumstances. Collective cannot guarantee the accuracy of estimates.
Let Collective handle the business side so your rate stays defensible
A member accountant sets up your S Corp, runs your payroll, and keeps your books ready, so the rate you just calculated is the rate you actually keep.