$60/hour × 2,080 hours (a full-time employee year) is $124,800. But freelancers do not bill 2,080 hours. At a realistic 1,250 billable hours, $60/hour is $75,000 in revenue; after ~15% business costs and US self-employment tax, it compares to an employee salary of roughly $47,397 with benefits.
| Billable hours / yr | Revenue | After 15% costs | SE tax (US) | ≈ Employee salary equivalent |
|---|---|---|---|---|
| 1,000 h | $60,000 | $51,000 | $7,206 | $37,918 |
| 1,250 h | $75,000 | $63,750 | $9,008 | $47,397 |
| 1,500 h | $90,000 | $76,500 | $10,809 | $56,876 |
| 1,800 h | $108,000 | $91,800 | $12,971 | $68,252 |
Per period at 1,250 billable hours
- Per month: $6,250 revenue
- Per week (48 working weeks): $1,562
- Day rate (8 hours): $480
Assumptions
Business costs 15% of revenue; self-employment tax 15.3% on 92.35% of profit (2026 Social Security wage base $184,500); the employee equivalent divides profit (less the employer-equivalent half of SE tax) by 1.25 to account for benefits an employer would provide — health cover, retirement match, paid leave. Income tax is similar in both cases and not included. Change any assumption in the hourly rate calculator or the take-home pay calculator.