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ICs and MTSOs. Are you in compliance? sm - MTstand


Posted: Feb 03, 2012

ICs beware.  If your MTSO is found to be noncompliant by the IRS, you will be next in their crosshairs.

http://erginc.com/pdfs/independent_contractors_20_questions.pdf

20-questions - mt

[ In Reply To ..]
The IRS quit using the 20-questions a long time ago. They have categorized their description to three basic categories - Behavioral Control, Financial control, Relationship.
The downside to that is that according to the IRS worker I spoke with, it's 80% subjective. You and I might work for the same company as ICs. We call the IRS at the same time to ask if we are misclassified. You get IRS worker A, I get IRS worker B. We share the same script and one of us will be misclassified and the other not.

The other thing is to realize the onus does not just lie with the MTSO. If you are an IC, then it's up to YOU to make sure you are in compliance. If you are working for a company who treats you like an employee but calls you an IC, you have to remember you are there by choice.

I would encourage all contractors to really review what being an IC means and to make sure you are treating yourself like an IC as well as having any MTSO you associate with treat you that way as well.

I agree with you 100%. ICs do shoulder some risk...sm - me

[ In Reply To ..]
when they work in a position as a pseudo IC when they should really be classified as an employee. In the future they could actually suffer from the "trickle-down" effect when/if MTSOs are prosecuted and fined.

As far as the 20 questions go, I do now see that they are outdated but they still are a more understandable list of questions to ask yourself if you are an IC.


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