The biggest difference that I ran into with W-2 vs. CTC (and I still do
some CTC) was insurance. E&O can get expensive, and W-2's are covered
by whatever company (client or consulting company) they W-2 to. CTC you
have to cough up E&O at the very least, and in some cases, alot more.
One client wanted auto insurance in the amount of $2MM in case we had an
accident in their parking lot. The fact that we were working remote made
no difference. The box said auto insurance, I was expected to pony it
up. But they refused to pay any more hourly despite the ridiculous
demands.
Doug Fuerst
------ Original Message ------
From "Tracy R Reed" <[email protected]>
To [email protected]
Date 2/9/2026 17:45:05 PM
Subject Re: Recruiters
Hi Mark,
Being that you mention W2 and C2C:
I'm sure that there are a lot of businessmen/independent consultants here with
a lot more experience than I. Maybe some of you can enlighten me with your
experience. Because I have a lot of questions about W2 vs C2C.
Questions such as:
Why do employers always seem to want W2?
Why do more people not insist on C2C? Particularly once you are making more
than around $120k/yr which is where my accountant tells me the overhead starts
to become worth it?
I’ve been making it no secret that I prefer C2C work. I would take a really
good direct W2 job but I really prefer C2C. It just makes things so much better
for me economically but costs the employer the same.
Then the recruiter or business owner will typically say, “But we want someone
full time.”
Me: “Yeah, I want full time too. 40 hours per week.”
Them: “They don’t want to do 1099.”
Me: “I don’t want to do 1099 either. That’s not what C2C means.”
Them: “But they want someone who is going to stick around.”
Me: “I want to stick around! I was at Splunk, a famous $25B
logging/SIEM/cybersecurity company, for two years and would love to still be
there! My dream job would keep me for many years!”
Them: “But they want someone with some loyalty to the company.”
Me: “This is an at-will position right? They make that specifically clear in
the offer letter. They reserve the right to let me go at any time for no
specific reason and make zero promises and by hiring me incur no obligations
beyond those required by law, right? And they will explicitly put it in writing
that this is at-will so there is no confusion. So they want totally one-sided
loyalty. Are they looking for someone who doesn’t know what at-will means? A
rube with no business skills?”
At my level, the tax savings from C2C are huge. My accountant says that once
someone starts making more than a certain amount (which I exceed) and has
deductions that it can start to make a lot of sense to go C2C vs W2. And that
is how it has certainly played out for me these past few years. I love being
able to write off my internet, my phone, my computer, my computer books, my
professional organization memberships, etc.
C2C doesn’t cost the employer any more. The idea is that the burden of certain
expenses are shifted to the employee/corp/contractor and they do their own
taxes, accounting etc. But in this way the employee/corp can handle their taxes
and expenses in a way which is uniquely suited to their needs.
Since it does not cost the employer any more it makes great sense for the
contractor/worker/employee/partner to go C2C. The C2C rate is typically
1.3-1.4x the W2 rate. The company saves on overhead which gets shifted to the
employee. This definitely isn’t for everyone. But for people with good earnings
who have deductions it can save a ton.
The insistence on W2 really just looks like a sort of mind-game and a way to
take advantage of the employee.
Is it just an ego game on the part of the employer? “I want to have real
employees reporting to me and not contractors. I don’t want to be their client.
I want to clearly be their employer and sole source of sustenance. But I want
to reserve the right to can them the week before Christmas with no notice, no
severance, and no reason given.
"There is no non-imaginary advantage to me as your employer to have you W2
instead of C2C but I want you on W2 anyway. Here, pay tens of thousands extra in
taxes!”
Where am I wrong here?
- Tracy Reed
On 2/9/26 07:49, Mark Jacobs wrote:
I've been telling them $135 W2, 1099/CTC much higher.
Mark Jacobs
Sent from ProtonMail, Swiss-based encrypted email.
GPG Public Key
-https://api.protonmail.ch/pks/lookup?op=get&[email protected]
On Monday, February 9th, 2026 at 10:29 AM, Steve
Beaver<[email protected]> wrote:
I have a suggestion for all American consultants even if you have a job when a
recruiter calls you tell them you’re part of a group in our minimum rate as a
group is $120 per hour W-2
Sent from my iPhone
No one said I could type with one thumb
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