Federal Rules Regarding Treatment Of Workers As Employees Or As Independent Contractors

In previous blog posts, I addressed California’s rules regarding a worker’s status as an independent contractor versus an employee. Click here and here to revisit those posts.

The Internal Revenue Service recently posted tips regarding federal rules that apply to a worker’s status. As an owner of a small business, whether you hire workers as independent contractors or as employees will impact the amount of taxes you withhold from their paychecks and how much taxes you pay. Additionally, it will affect what documents and information they must provide to you, what tax documents you must give to them and how much additional cost your business must bear.

Here are the top ten things every business owner should know about hiring people as independent contractors versus hiring them as employees.