<prompt> Human: I was out of work for the better second half of 2016 before I took a job in Nov 2016 as a constractor for the 1st time. At that time I was offered 65W2 or 701099. I took the 1099 offer after setting up an LLC which seemed like the best option at the time tax deductions, etc. Now, after speaking with few colleagues, this is starting to not seem like a good idea. I dont believe the 5 extra dollars is enough to cover all the cost. I was hoping someone could chime in and possibly share their experience and advice. ResidenceWork State - TexasEdit - Benefits for being W2 - Okay Insurance, no 401k, no PTO, no bonus  <response>: As a 1099 contractor, you get to set your own hours. Its a different deal from being a W2 employee. If you have other work youre doing on the side, that can be a decent advantage. But the added self-employment tax paying your own social security, etc. is very painful, not to mention having to get your own health insurance. If theyre treating you like a W2 employee and expecting you to keep certain hours, theyve illegally misclassified you to save on insurancetax costs. 