[bilbo7208]

[ebaines]

No, tax rates are not lower for 1099 earners. Actually, in a sense taxes are higher for 1099 employees. Income from both a W2 and a 1099 are considered to be ordinary income, and hence are taxed using the same rates for income tax. However, a 1099 employee is considered to be a self-employed contractor, and so in addition to income tax you also have to pay employment taxes (social security and medicare) at a rate that is twice what W2 employees have to pay. On the plus side - being self employed you may be able to deduct some expenses that employees can't.

[bilbo7208]

Thank you. Case closed.

[joypulv]

But you lower your tax BILL by filling out a Schedule C with all your expenses related to self employment.
(Sorry, I know you want the case closed.)