Hiring Independent Contractors

Using independent contractors can save you a bundle in payroll taxes, health insurance costs, workers' compensation premiums and overtime pay.

But the rules about who qualifies are complicated, and the IRS and state revenue agencies keep a close eye on businesses that hire independent contractors. Misclassifying a worker can result in serious financial penalties in a state or federal audit.

Now for the first time in decades, the IRS has made the rules about hiring independent contractors a lot simpler. New IRS rules make it easier for employers to prove that a worker is an independent contractor; they also allow employers that have misclassified workers to pay reduced assessments and penaltiesor avoid them altogether.

Hiring Independent Contractors reflects these important IRS changes and shows employers how to:

assess who qualifies as an independent contractor

hire ICs without risking an audit

retain ownership of intellectual property when using ICs

handle an IRS audit

take advantage of the IRS's ""Safe Harbor"" law

All independent contractor agreements are included on disk and as tear-outs.