My wife and I (both in the United States) file taxes jointly and make about $110,000 annually from our W-2 jobs.
I was offered a side gig that would pay an additional $48,000 per year. The company is letting me decide whether to work as a part-time W-2 employee for that gig, or an independent contractor who receives 1099 box 7 income.
By my calculations, receiving the income on a W-2 would be slightly better from a tax perspective, because we'd be taxed at 22% for the additional income, whereas with 1099 income we'd pay 21% (the business tax rate) plus self-employment payroll taxes of ~7.5 percent.
Is this analysis correct? I am still wrapping my head around the recent tax law changes, and may be missing something.
(The side gig would not offer any benefits regardless of how I take the income, so my only real question to weigh is what is better from a tax perspective.)