You're a contractor when...

[Andrew Plato <intrepid_es -at- yahoo -dot- com>]

1. You sign a contract with an agency and are an employee of the agency.

OR

2. You meet the requirements Len Humbird listed.

> * you are incorporated and/or have a business license
> * you have a business checking account
> * you have liability insurance
> * you pay your own benefits
> * you have employees (e.g., yourself, your s.o., your kids)
> * you have a business ID (business card, letterhead, etc.)
> * you have an office away from the client site
> * you advertise your services somewhere
> * you generally have more than one client at a time
> * you bill the client rather than get a "paycheck"
> * you can set your own hours
> * you consult with the client on what services/products you render rather
> than being told how to do your job
> * you have business expenses
> * you experience profits and a losses
> * etc., etc., etc.

3, You sign a contract with a client to provide services.  


You are not an employee just because they give you a computer or tell you what
to do.  If you work for an agency, you work for an agency and as such are
contracted to the client. Read your contract carefully.  If you signed a
contract with the company, you are working for them under the terms of that
contract. 

The IRS doesn't much care about small time consultants. They're more interested
in big companies that skim off wage taxes. You're in much bigger trouble if you
run a consulting company and 1099 everybody. 

Incidentally, this is exactly why many companies will not use independents
unless they sign through an agency. Too dangerous. 

Andrew Plato

Tell me now, how do I feel: http://members.home.com/aplato



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