Help: contract/perm rate difference?

Got an offer for a contract-to-hire position: "base rate of $72/hour. With a $7/pass-through to 1099, you would realize a rate of $65/hour.".

What's the equivalent annual salary as an employee for this offer? As a contract, there is no pay for vacation, sick, benefit etc. Always worked as an employee, I have no idea about 1099 pay.

What's the $7 1099 pass-through means?

Thanks for your help,

Jiang