Categories: News Articles

Independent Contractors – Classification – Don’t Ignore Other Types Of Workers

Tax SignIn addition to employees and independent contractors, there are two other categories that workers can fall into. If you hire either of these types of workers, be sure to handle the paperwork properly to avoid IRS audit headaches and penalties:

Statutory employees don’t have federal income taxes withheld, but FICA (and generally FUTA) taxes do apply. Employers need to issue w-2 forms and the workers report income and expenses on Schedule C. These include drivers who distribute food, full-time insurance salespeople, “home workers” who have supplies provided by employers and certain types of full-time salespeople.

Statutory nonemployees include direct sellers and licensed real estate agents. They are treated as independent contractors if most payments for their services are directly related to sales and they have a written contract stating they wont be treated as employees.

For more information, see IRS Publication 15A, Employer’s Supplemental Tax Guide.

If you have any questions or require further info please call 718-531-1105 or send an email.

This web site and these articles are not tax or legal advice and are not intended as tax or legal advice.  They are intended to provide only general, non-specific legal information and are not intended to cover all the issues related to the topic discussed.  The specific facts that apply to your matter may make the outcome different than would be anticipated by you.  This web site and these articles are based on United States law.  You should consult with an accountant or lawyer familiar with the issues. This web site and the articles contained on this web site are not solicitations.

Contact Info:

Ronald Semaria
Semaria Consulting
1408 East 66th St
Brooklyn, NY 11234

Phone Numbers:

Phone: 718-531-1105
Toll-Free: 866-531-1105
Toll-Free: 888-IRSAUDIT
Toll-Free: 888-RONTAXES
Fax: 718-444-7152