Business Development
A Serious Game of 20 Questions
Here are the 20 questions the IRS will use to determine if workers are company employees or true independent contractors.The IRS considers any “yes” anemployer/employee relationship. Consult an Attorney or CPA for clarification to these questions. Failure to properly identify classifications can be costly to your business.
- Do you provide the worker with instructions as to when, where and how work is performed?
- Did you train the worker in order to have the job performed correctly?
- Are the worker’s services a vital part of your company’s operations?
- Is the person prevented from delegating work to others?
- Is the worker prohibited from hiring, supervising and paying assistants?
- Does the worker perform services for you on a regular and continuous basis?
- Do you set the hours of service for the worker?
- Does the person work full time for your company
- Does the worker perform duties on your company’s premises?
- Do you control the order and sequence of the work performed?
- Do you require workers to submit oral or written reports?
- Do you pay the worker by the hour, week or month?
- Do you pay for the worker’s business and travel expenses?
- Do you furnish tools or equipment for the worker?
- Does the worker lack a “significant investment” in tools, equipment and facilities?
- Is the worker insulated from suffering a loss as a result of the activities performed for your company?
- Does the worker perform services solely for your firm?
- Does the worker not make services available to the general public?
- Do you have the right discharge the worker at will?
- Can the worker end the relationship without incurring any liability?
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