Classifying Contract Workers Alliance OH

One of biggest impediments to small business growth is the difficulty of classifying workers as independent contractors instead of employees. This is essentially a tax issue. An independent contractor -- someone who does work for your company but is not a full employee -- is responsible for paying his/her own taxes. If that person were classified as an employee, you would be responsible for taxes. But the IRS has a long list of qualifications a worker must meet to be classified as an independent contractor, and often business owners and the IRS disagree about who qualifies. The IRS qualifications are listed here, along with some steps you can take to increase the likelihood of your workers qualifying as independent contractors.

Local Companies

Leib Investigations & Consulting Inc
(330) 798-7660
2418 E Market St
Akron, OH
Expressworks Occupational Health Svcs
(330) 645-0411
2850 S. Arlington Rd. Ste 104
Akron, OH
Shapard Risk Management
(216) 371-9702
2194 Middlefield Rd
Cleveland, OH
First Baptist Day Care Center
(419) 224-4189
451 N Cable Rd
Lima, OH
Williams Innovations
(330) 896-9595
1485 Corporate Woods Pkwy
Uniontown, OH
Rsm McGladry Inc
(614) 224-7722
191 W Nationwide Blvd
Columbus, OH
Mms Group
(440) 423-1713
1540 Chagrin River Rd
Gates Mills, OH
Executive Search Group
(330) 867-7725
1300 Weathervane Ln Ste 216
Akron, OH
Boltwood Associates
(614) 457-9141
Columbus, OH
Executive Development Group-Ohio
(614) 573-3200
Columbus, OH



One of biggest impediments to small business growth is the difficulty of classifying workers as independent contractors instead of employees. This is essentially a tax issue. An independent contractor -- someone who does work for your company but is not a full employee -- is responsible for paying his/her own taxes. If that person were classified as an employee, you would be responsible for taxes. But the IRS has a long list of qualifications a worker must meet to be classified as an independent contractor, and often business owners and the IRS disagree about who qualifies. The IRS qualifications are listed here, along with some steps you can take to increase the likelihood of your workers qualifying as independent contractors.

The issue of control is central to the IRS' independent contractor evaluation. If you control how a worker completes a task for you, the IRS often regards your relationship with a worker as employer-employee. In order for someone to qualify as an independent contractor, the following conditions must exist:
  • The worker hires, supervises and pays his or her assistants

  • The worker is free to work when and for whom he or she chooses

  • The worker does the work at his or her own office or shop

  • The worker is paid by the job or receives a straight commission

  • The worker has the risk of profit or loss

  • The worker does work for several businesses at one time

  • The worker makes his or her services available to the general public (sometimes indicated by having business cards or a listing in the Yellow Pages)

  • The worker cannot be fired as long as he or she meets contract specifications

Some states have rules regarding independent contractors so check with your state's employment office before hiring. In addition, certain workers are automatically classified as employees, regardless of their work arrangement with you. Workers in this category include: full-time salespeople who sell goods for resale; full-time life insurance agents working mainly for one company; at-home workers who are supplied with material and given work performance specifications; and food and laundry delivery drivers.



To increase your chances of convincing the IRS that a worker is in fact an independent contractor, take the following steps:


  • State in your contracts that a worker is an independent contractor including a statement that all payments to the worker will be reported to the IRS on Form 1099.

  • Pay for work by the job, instead of by the hour, the week or the month.

  • Have all workers submit invoices for work before paying them.

  • State in all contracts with contract workers that the individual is responsible for his or her own insurance, including workers' compensation.

  • Construct a contract that allows the contract worker to use his or her own tools and equipment, and to hire his or her own assistants.

Featured Local Company

Leib Investigations & Consulting Inc

(330) 798-7660
2418 E Market St
Akron, OH

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