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independent contractor definition - weetom

Posted: Oct 11, 2011

I am looking for some clarification on the definition, as per the IRS website, of an "independent contractor." With the majority of companies now hiring MTs as IC's, does this definition apply ?

"You are not an independent contractor if you perform services that can be controlled by an employer (what will be done and how it will be done). This applies even if you are given freedom of action. What matters is that the employer has the legal right to control the details of how the services are performed."

In my opinion, when a company outlines precise hours to be worked, it somewhat takes away from this definition. My idea of an independent contractor is someone who is able to choose their hours, etc. If not, then I feel they should be treated as employee status - not necessarily having to offer insurance benefits, but certainly should not be able to mandate MTs hours and should have to withhold taxes as well.

Any thoughts ?

IC status + MTSO determining your schedule - anon

[ In Reply To ..]
Yes, an MTSO can set your schedule with some degree of leeway (IN MY PERSONAL OPINION) because...

Think of it as if you were a plumber. You wanted to get a contract with a hospital to do their emergency plumbing work, but you were only available M-F 9-5. What if there were never any plumbing emergencies during that time? The hospital would never call you. You could then say to the hospital, "Why don't you ever call me?" And the hospital could say, "Well, if you were available from 5 p.m. to midnight, T-Sa instead of M-F 9-5, we have a lot more plumbing emergencies during that time." You, as an independent contractor, could then decide whether you wanted to work nights and weekends in order to make some money. Or not. It would be your choice.

In the situation of an IC working for an MTSO as an MT, the MTSO is simply telling the IC when there will be work available. You, the IC, can either choose to take it during the time it is available or leave it.

All that goes by the wayside, though, if ALL of the conditions for IC status according to the IRS are not met. The above is just one of the many conditions.

IC pay - weetom

[ In Reply To ..]
True enough - but on that same note, if you hired a plumber who was an independent contractor, would you be able to tell them what you were going to pay them OR would they tell you what they charge ?

IC status and IRS conditions - Jay

[ In Reply To ..]
What are some of the other conditions you mentioned that need to be met for the IRS to be working as an IC? I know of incorporating as a sole proprietor or LLC is necessary, but anything else?

I've never had to 'incorporate' to work as an IC. - anon

[ In Reply To ..]
.

Independent contractor - MTER

[ In Reply To ..]
My husband has been an IC in another field for almost 20 years. He has never been incorporated, gotten an LLC or sole proprietorship. He just gets a 1099 at the end of the year and we file a schedule C listing all of his expenses as part of our taxes.

However, make sure you have documentation for each and every thing that you write off because the IRS can and will audit you. Been there, done that and was very glad we filed honestly.

IC status - weetom

[ In Reply To ..]
so just out of curiosity, does your husband, in his IC position, tell his customer what he charges or do they tell him what they're willing to pay?
Any independent contractor I've ever hired, such as an electrician or plumber for instance, has ever let me tell them what I'll pay
I don't see how a transcription service can either

staying within the norm - dont overprice yourself

[ In Reply To ..]
I think you are stuck defending one point to support your position and are being unreasonable. Plumbers and doctors and lawyers know what their going rate is in a geographic locale for the services they provide. Should they decide to charge unreasonable fees and find themselves without clients, well, they won't be ICs long. They will just be unemployed.

Being an IC is not just about the MTSOs deciding what they are going to pay you. There are many factors in a formula that influence the status. Plumbers do not charge anything when no one will hire them because they are overpriced or difficult to get along with. I would offer that you look at the big picture and not one sticking point.

are you serious ? - weetom

[ In Reply To ..]
Do you believe that 4 cpl for VR is OVERPRICED ? Considering the line requirements aren't double, where is the justification for half the pay
I don't expect to make big bucks - but minimum wage would be nice - especially having to take out my own taxes and knowing that I was making $4 an hour more less than 2 years ago ! As well as no increases in cpl in typing either
The only reason they get away with it is because of all the offshoring - we just aren't as necessary anymore - all I can figure is you must be in a good place or don't need to support a family by yourself, cut this just doesn't cut from where I sit

criteria for IC status - but each case is unique - anon again from above

[ In Reply To ..]
I am not a lawyer (yet), and this is not legal advice. But try this link: http://www.comptroller.ilstu.edu/downloads/20-factor-test-for-independent-contractors.pdf

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