New freelancers often take a target salary, divide by 2,080, and undercharge for years. A better method: pick the W-2 package you would accept (salary + health + match), set honest unpaid days, and read the calculator’s breakeven hourly rate. That is your floor — not your quote.
Calculate a freelance floor rate
FAQ
Why is dividing salary by 2,080 wrong?
Freelancers do not bill 2,080 hours. Marketing, admin, sick days, and holidays are unpaid. Taxes and benefits also differ from W-2 pay.
What utilization rate should I assume?
Many freelancers bill 50–70% of working hours. Start conservative, then raise the rate or utilization as your pipeline stabilizes.
Should the minimum rate equal the breakeven rate?
Breakeven matches a specific W-2 package. Your minimum rate should be breakeven plus profit margin and risk cushion.
Estimate only — not tax, legal, or financial advice. Numbers use the same engine as the free calculator (2026 federal brackets; state brackets from Tax Foundation where selected).