What independent contractor means
An independent contractor is a person or business you hire for a job who controls how the work is done and runs their own business, rather than being your employee.
Also called 1099 contractor, subcontractor.
Where it shows up in your business
Calling a helper a contractor does not make them one; the IRS and states look at control and independence. Getting it wrong means back taxes and penalties, so read the tests before your first hire.
Work it out
- Free template: Subcontractor agreement template
- Money guide: 1099 vs W-2 for your first helper
- Money: Money guides for contractors