All Topics > Business Services > What classifies an independent contract worker >

What classifies an independent contract worker Maryland

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.

Local Companies

Navtrak
800-787-2337
2000 Northwood Drive
Salisbury, MD

Neubrain, LLC
301-442-4129
8001 Goodhurst Drive
Gaithersburg, MD

Mid-Atlantic Med Testing
866 376-6107
7305 Baltimore Avenue
College Park, MD

B2Bcorpcredit
(301) 449-8600
6507 Old Branch AVe
Camp Springs, MD

Collegiate Services Inc
(410) 740-6660
5076 Dorsey Hall Dr
Ellicott City, MD

Legin Group
(301) 515-9328
12850 Middlebrook Rd
Germantown, MD

Aarsand Management
(410) 256-6655
9114 Belair Rd
Nottingham, MD

Bannock Street Center Lp
(410) 321-9788
300 Allegheny Ave
Towson, MD

Changing Focus Inc
(410) 721-0992
1657 Crofton Pkwy
Crofton, MD

A Rapid Solution
(301) 776-5000
Laurel, MD

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

Navtrak

800-787-2337
2000 Northwood Drive
Salisbury, MD
www.navtrak.net

Read more about What classifies an independent contract worker

- Internet Home-Based Business Maryland

There are many advantages involved in choosing an internet home based business as your primary or secondary source of income. Use these benefits to find a legitimate work at home jobs that suits your needs and desires.

- Classifying Contract Workers Maryland
- Encouraging a Bad Worker to Quit Maryland
- Contract Guide Maryland
- Hiring a Domestic Worker Maryland
- Selling Franchise Maryland
- Rates of Pay for Contractors Maryland
- The Safest Way To Start A Business Maryland
- Contract Programming Maryland
- Hiring Independent Contractors Maryland

Regional Articles

- Hiring Independent Contractors Maryland

Ask independent contractors to fill out a questionnaire and provide documents to prove that they are really self-employed. These are two very important steps in the process of hiring an independent contractor and making sure they are properly classified as such for tax purposes.

- Encouraging a Bad Worker to Quit Maryland
- Contract Guide Maryland
- Contract Programming Maryland
- Rates of Pay for Contractors Maryland
- Hiring a Domestic Worker Maryland
- The Safest Way To Start A Business Maryland
- Classifying Contract Workers Maryland
- Selling Franchise Maryland
- Internet Home-Based Business Maryland

Related Local Events

GBTC 101
Dates: 6/19/2009 - 6/19/2009
Location: ETC - Factory Building
Baltimore, MD
View Details

BBJ Biz Mix @ Nouveau Contemporary Goods
Dates: 6/18/2009 - 6/18/2009
Location: Nouveau Contemporary Goods
Baltimore, MD
View Details

Advertising	Food & Beverage	Nightlife
Business Services	Franchise	Online Database
Career	Health	Pets
Cars	Holidays	Real Estate Resources
Computer Hardware	Home Appliances	Retail & Consumer Services
Construction	Home Electronics	Software
Education	Home Services	Technology
Entertainment	Industrial Goods & Services	Telecommunications
Environmental	Insurance	Trade Shows
Family	Internet	Travel
Fashion	Legal	Weddings
Financial Services	Miscellaneous	World History

Advertising	Family	Home Services	Real Estate Resources
Business Services	Fashion	Industrial Goods & Services	Retail & Consumer Services
Career	Financial Services	Insurance	Software
Cars	Food & Beverage	Internet	Technology
Computer Hardware	Franchise	Legal	Telecommunications
Construction	Health	Miscellaneous	Trade Shows
Education	Holidays	Nightlife	Travel
Entertainment	Home Appliances	Online Database	Weddings
Environmental	Home Electronics	Pets	World History