ISU – The Independent Contractor’s Agreement Kit

INDEPENDENT CONTRACTOR AGREEMENT — AN OVERVIEW

ADVANTAGE:It is more advantageous to treat assistants as an independent contractor (as opposed to an employee) because you save on payroll taxes, the hassles of many forms, tax deposits and penalties for being late with forms and deposits.

PURPOSE: The purpose of this agreement is to help establish that the assistant is an independent contractor, as opposed to an employee.

POSSIBLE RISKS: The issue of independent contractor vs. employeecould be controversial. Improperly classifying assistants as independent contractors, instead of employees, could involve the risk of back assessments in the way of payroll taxes, interest and penalties. Over a number of years such assessments can be substantial.

PLANNING: Whether an assistant will be considered an employee will depend on how much controlyou have over them. The more control you have, the more likely they are to be considered an employee and not an independent contractor.

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