The IRS has changed its standards for determining whether a worker is an employee or a contractor. The agency now follows 10 set factors – down from 20 – to decide which category a worker belongs in. If you’re facing an IRS audit, you need to be able to explain why you categorize your workers the way you do.
In Using Independent Contractors, you’ll find:
- The IRS’ 10-question “test” to establish worker classification
- A sample contract to make freelance relationships stick
- Guidelines for 22 states with contracting rules stricter than the IRS’
- A list of errors commonly made on 1099s
Using Independent Contractors prepares you for any scenario the IRS might challenge. You’ll know which workers are contractors, which aren’t and how to protect yourself from any backlash you might face. You can avoid putting your business at risk and save yourself time and money.
Table of Contents
Beware Agents Bearing Compliance Checks
Out of Harm’s Way
A Tricky Balancing Act
You and the IRS
On the Plus Side
A Fuzzy Definition
The IRS’ 20-Factor Test
20-Factor Test Revised
No Legislative Relief Yet
Quiz Yourself on Some Common Scenarios
Watch State Regulations
The IRS’ New Attitude
Section 530 Relief
Form SS-8: Inviting a Ruling
The IRS on Patrol
Compliance Check or Audit?
Form 1099: Handle With Care
Congress Hands You a New Weapon
An Ounce of Prevention
Don’t Be a Control Freak
Contracts: Your Most Important Protection
Sample Contractor’s Agreement
Getting the Most From Your Independent Contractors
Establish a Talent Pool
How to Negotiate a Price
Protect Confidential Information
Don’t Overlook Your Staffers’ Morale
Who Pays When a Contractor Fails?
Recent Court Rulings
Circuits of the U.S. Court of Appeals
Hiring independent contractors can be a headache – but it doesn’t have to be. Know your rights and responsibilities. Protecting yourself from the risks of hiring independent contractors doesn’t take much, and you’ll be glad you did.
Phillip A. Ash