Entrepreneurs realize that growing their business will mean growing their team.  But how can you know whether to bring on an independent contractor or employee?  Conversely, when you’re hired by someone else, it’s important to know whether you’re considered a independent contractor or employee.  The distinction between these two types of hires is important, as obligations look different for each, especially when it comes to taxes (just ask your CPA).  I’ve summarized the key differences for you in a simple chart that you can post, share, print or save for future reference.

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In sum, independent contractors are self-employed and responsible for their own taxes, costs/expenses, supplies/equipment and generally have the autonomy to choose when, where and how they work on projects. Employees are subject to their employer’s control of such work parameters.  For more information about the differences between independent contractors and employees, see articles by the IRS, LegalZoom and FindLaw.

With Gratitude,

 

Nik

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