When is an independent contractor not and independent contractor?
John Phillips at The Word on Employment blog explains, with simplicity, the difference between and independent contractor and an employee.
It is absolutely imperative that an employer understand the differences because the tax implications are massive. Mere agreements labeling a person or business as an “independent contractor” is far from sufficient. As Mr. Phillips simply states, “The fact that you have an “independent contractor agreement” with the worker isn’t determinative. If a worker is doing what other employees do, he/she is likely to be an employee irrespective of an agreement that says otherwise. If the worker performs work only for you, as opposed to performing work for multiple companies, he/she is likely to be an employee. ”
IRS tools provided in the article can be found here, here, and here.
Tuesday, March 18th, 2008
