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Mar 15, 2024 · The IRS 20-point checklist for independent contractors employs the Common Law Rules to look at multiple aspects across three categories: Your behavior toward the worker, The financial arrangement you set with the worker, The nature of the working relationship. The ABC Test
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How do independent contractor checklist answers work?
How do I know if a worker is an independent contractor?
What is the IRS 20-point checklist for independent contractors?
Who qualifies a worker as an independent contractor?
Mistakenly classifying an employee as an independent contractor can result in significant fines and penalties. There are 20 factors used by the IRS to determine whether you have enough control over a worker to be an employer.
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- Is the worker required to comply with instructions about when, where and how the work is done?
- Is the worker provided training that would enable him/her to perform a job in a particular method or manner?
- Are the services provided by the worker an integral part of the business' operations?
- Must the worker render the services personally?
If you answer “yes” to all of the first four questions, you are likely dealing with an Independent Contractor. Answering “yes” to any question from numbers 5 through 20 means the worker more likely should be classified as your employee.
Jun 15, 2021 · This handy guide for independent contractors explains tax responsibilities, deadlines, deductions and how to pay.
Aug 22, 2024 · Learn how to determine whether a person providing a service to you is an employee or an independent contractor.
The Internal Revenue Service (IRS) provides this checklist as a guide to determine whether a worker is an employee or an independent contractor. This distinction is crucial as it impacts your tax obligations and payroll management as a small business owner.
