Independent Contractor (Self-Employed) or Employee?
Not sure if your new worker and Independent Contractor or an employee? The IRS has very particular guidelines when making this decision. Please see the below information posted on IRS website: (http://www.irs.gov/businesses/small/article/0,,id=99921,00.html) It is critical that business owners correctly determine whether the individuals providing services are employees or independent contractors. Generally, you must withhold income taxes, withhold and pay Social Security and Medicare taxes, and pay unemployment tax on wages paid to an employee. You do not generally have to withhold or pay any taxes on payments to independent contractors. Select the Scenario that Applies to You: I am an [...]