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RateRight
Annual income goal, billable hours per week, taxes and overhead — get the hourly rate you actually need to charge.
Freelancers typically bill only 50–70% of their working hours. Admin, sales, learning, and downtime aren't billable. Build that into your rate or you'll burn out trying to hit a salary number.
Hourly rate to charge
$159.14
What you entered
Total revenue needed (income + overhead, grossed up for tax)
($120,000 + $12,000) ÷ (1 − 28/100)= $183,333.33Total working hours per year
40 × 48= 1920 hrsBillable hours per year
1920 × 60/100= 1152 hrsHourly rate to charge
$183,333.33 ÷ 1152= $159.14Result
Hourly rate to charge: $159.14
To take home $120,000 after $12,000 overhead and a 28% tax rate, charging $159.14/hour across 1,152 billable hours covers it.