Independent Contractor vs. Employee Wrap Up
I have just wrapped up a series of posts analyzing seven factors the IRS considers when determining whether a worker is an employee or an independent contractor. The incorrect classification can have enormous tax implications for both the employer and the worker so it is important that you pay close attention to how a worker is classified or you may be stuck with a giant tax bill that you didn’t count on.
Here is the list of the seven posts:
1. Control
2. Capital
3. Opportunity
4. Right to Discharge/Fire
5. Integral Nature
6. Permanence
7. Intent
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CJN said,
Wrote on October 4, 2007 @ 8:37 am
What happens if someone was misclassified as an Independent Contractor, had reimbursements of expenses but no taxes withheld over the term? Does the employer go back and pay the taxes for the term and then 1099 the IC for the expenses as income? Then the IC ammends tax filings? What penaliteis are involved for the IC at that juncture? Any?
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Wrote on December 14, 2007 @ 10:47 am
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