What is the difference between a 1099 subcontractor and a W-2 in-house employee?

The main difference comes down to employment status, benefits, and how they are engaged with your company:

Independent worker: They are self-employed and provide services under a contract.
Benefits: Not eligible for employee benefits like health insurance, paid time off, or retirement plans.
Flexibility: Often hired for specific projects or short-term needs.
Pay structure: Typically paid piece rate pricing for the labor to complete the project.

Company employee: Works directly for your business as part of your team.
Benefits: May be eligible for benefits like health insurance, PTO, and retirement plans (depending on your company).
Pay structure: Typically paid hourly or paid an annual salary.
Stability: Usually part of your long-term workforce.