You are hiring an employee. Is that person an independent contractor or an employee?
Maybe, one of the most confused topics among both employers and employees.
The IRS has a publication dedicated to the whole issue. After you read it, you may still not understand how to classify an employee.
My advice in general.... Ask three questions
Does the person provide their own tools to perform a job?
Does your supervision simply involve the results of the services contracted? Meaning, do you care more that the job gets done over how it's done.
Does that person have the ability to provide the same service to your competition?
If you answer yes to all these, you probably have a contractor. If you answer no to anyone of these, you may or may not have an employee.
Many times I will usually challenge the business owner with this question. Does the service provider perceive himself as an employee or a contractor?
If you still have questions regarding this issue, please email me at gtvcpa@yahoo.com.
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