What does a W2 tech really cost? And how does 1099 compare?
Enter a tech's weekly pay (tips included). NailWage estimates the extra taxes the owner pays for a W2 employee, next to the 1099 option — so you bring numbers to your CPA and to your tech, instead of guessing.
What you pay the tech in a normal week — wages + tips.
2026 new-employer rates — all 50 states + DC.
W2 tech (employee)
The owner withholds the tech's taxes and pays employer-side taxes on top.
Owner pays
- Tech's pay
- $1,200.00/wk
- Employer FICA (7.65%)
- + $4,773.60/yr
- Federal unemployment (FUTA)
- + $126.00/yr
- State unemployment (new employer)
- + $245.00/yr
Owner pays ≈ $98.93/wk extra ($5,144.60/yr)
≈ 8.2% on top of pay — before workers' comp.
Not included: workers' comp insurance (required for employees; price varies by state and carrier), payroll-provider fees, and W-4 income-tax withholding.
Tech receives
- Gross pay
- $1,200.00/wk
- Tech's FICA withheld (7.65%)
- − $91.80/wk
- Tech's estimated check
- ≈ $1,108.20/wk
The owner pays another 7.65% on the tech's behalf (the other half of FICA). W-4 income-tax withholding not included. Tips still owe FICA — the 'no tax on tips' law only exempts federal income tax on tips (up to $25,000/yr, 2025–2028).
1099 tech (independent contractor)
The tech is paid in full and handles their own taxes.
Owner pays
- Tech's pay
- $1,200.00/wk
The owner pays no extra payroll taxes.
The owner sends Form 1099-NEC at year end; no withholding, no unemployment tax, no workers' comp.
Note: calling a tech '1099' doesn't make them one legally. A commission tech paid weekly by the owner is usually an employee under the law — a misclassification finding can mean years of back taxes plus penalties. That's a legal question for your CPA/attorney.
Tech receives
- Gross pay
- $1,200.00/wk
- Self-employment tax the tech owes (~14.1%)
- − $169.55/wk
- Left after SE tax (estimate)
- ≈ $1,030.45/wk
A 1099 tech pays both halves of FICA themselves (15.3% on 92.35% of earnings), before their own expenses and income tax. Half of SE tax is deductible on their income-tax return.
Same money from the owner: a W2 tech keeps ≈ $1,108.20/wk after FICA, a 1099 tech keeps ≈ $1,030.45/wk after self-employment tax — because under W2 the owner pays half of FICA for the tech. These numbers make the owner–tech conversation about switching to W2 much clearer.
An estimate from the numbers you enter, at 2026 new-employer rates — your salon's real rates depend on its unemployment history, state, and tax-agency decisions. Income tax, workers' comp, and payroll fees are not included. NailWage is a calculation tool, not a tax, legal, or payroll-filing service — confirm with your CPA.
Questions to bring to your CPA
NailWage doesn't conclude whether your tech should be W2 or 1099 — that's a legal question. These are worth asking:
- Do my commission techs qualify for 1099/booth-rent under my state's law? (E.g. California's AB 1514 requires the tech to set their own prices and be paid directly by clients.)
- If I move techs to W2, how much does my total monthly cost rise — including workers' comp and payroll-provider fees?
- Should the commission split change when moving to W2, and how do I explain it to my techs clearly?
- What will my salon's real unemployment (UI) rate be after the first year?
- What paperwork do I need before switching — W-4, I-9, payroll registration, insurance?
How the W2 Cost Check works
Three steps, all in your browser — NailWage doesn't store what you enter.
1. Enter the tech's pay
One number: what you pay the tech in a normal week, tips included. The calculator annualizes it (×52) to apply the per-year taxes.
2. Read the two columns
W2 column: the extra employer-side taxes (FICA 7.65% + FUTA + state unemployment) and the tech's estimated check. 1099 column: the owner pays nothing extra; the tech owes self-employment tax.
3. Take the numbers with you
Use them to talk to your CPA about the cost of switching to W2, and to your tech about their real take-home — instead of arguing from feelings.
Everything is an estimate at 2026 rates; real rates vary by salon and state. NailWage doesn't advise worker classification, file taxes, or process payroll.
Like seeing the numbers? Weekly closeout is this clear too.
NailWage is a weekly closeout tool for owners: turn your work sheet into a clear technician payout summary for both W2 and 1099 techs, plus a free card-fee check. Official payroll filing stays with your CPA or payroll provider.