November 6, 2007

Are You An Independent Contractor?

I read an article about Independent Contractors, and some of the IRS guidelines that determine if someone qualifies as one. Independent Contractors exist in any kind of business these days. A person supporting themselves by offering business services and expertise to clients may be an Independent Contractor as opposed to an employee. Some of the IRS guidelines are:

An Independent Contractor generally works for more than one company.

An Independent Contractor can terminate a contract with a company,just as the company can cancel a contract with an Independent Contractor as well.

Independent Contractors generally use their own tools and equipment; They will also set their own hours and control their own expenses.

Independent Contractors cannot be "fired" like an employee, unless he or she fails to fufill the terms of the contract.

Parents and others that work from home doing telecommuting are often Independent Contractors, but it is important to be sure of your status when you sign on with a company. Independent Contractors have different rules and regulations than Employees have when filing and reporting income taxes and deductions, so it is important to know for sure if you are an Independent Contractor or an Employee when working with a company.
If you are not sure,it is best to consult an accountant or lawyer.

To read the full article written by Priscilla Huff, go to Ivillage

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