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where I would find the steps to go about becoming an Independent Contractor ? - Ports

Posted: Nov 26, 2010

Can anyone tell me where I would find the steps to go about becoming an IC? Once I learn how to legally become an IC, then what do you do, just send your resume to the various companies? I would like to investigate becoming one. Thanks so much. Deidre.

Define IC as you know it? - LMJ

[ In Reply To ..]
There are two types of ICs right now according to what type of clients you have.

There are ICs who are the direct-connect to the client. You market. You price. You secure. You fulfill.

Then there are ICs who are a direct-connect to the MIDDLEMAN who is a direct-connect to the client. These would be clients who market, provide applications, pricing to the client. You get to stop when you feel like stopping and they are left with the responsibility of covering the accounts.

Legally becoming an IC means you have a social security number, unless you are choosing to become a bonafide business entity with federal ID, etc. (If you plan on having employees you'll need the EIN anyway.)

And no, IMO, your resume is meaningless. You're not marketing yourself as a person, you're marketing yourself as a business. So you'd send actual marketing materials to prospective clients.

There was a book I used back in the early 80s but I can't remember the name of it.

You'd want to first meet with your accountant to see what the total implications of IC status are. Then decide your business entity (sole-proprietor, S-corp, C-corp, LLC).

An IC simply means an independent contractor who - sm

[ In Reply To ..]
works their own hours. I will not do IC work again because if you are IC and lose your job, no unemployment for you!! I was very lucky this last job I had was employee status. Really no difference between IC and employee status...IC they do not keep out taxes and employee status they do. Whether you are employee or IC, if there is no work, either way you will not get paid.

IC status isn't just as an "employee" alternative - LMJ

[ In Reply To ..]
It's also what you are if you market your own clients (which essentially makes an MTSO your CLIENT).

Beware the pitfalls of being IC status - Much experience with IC/employee status

[ In Reply To ..]
As IC, you have to withhold your own taxes, no unemployment benefits, you pay for your own medical, no paid time off, and no protection as an IC against clients/employers who do not pay - you have to take them to small claims court at your expense. This happens a lot, or pay often not being on time and you spend a considerable amount of time chasing paychecks down. You need to make sure (if working for someone else who has the accounts) that there is not a clause in the contract that says basically "you get paid when I get paid" and make sure the person you are working for has a buisness bank account separate from personal (meaning they have a buffer to cover paying you whether they have been paid by the client or not). As IC, depending on whether you have your own accounts or working for someone else (not a big company), you may find yourself working more than 40 hours a week to get the work done (being on call 24/7). As employee, when your 8-hour shift is done, you don't have to worry about what is left in the que, you don't have to worry about taxes, you know when you are going to get paid, have medical benefits, have paid time off, etc.

On paper, pay being IC may look good, but taking the above into consideration regarding taxes, insurance, and PTO, pay may turn out to be about the same as working for a service as employee in the long run.

Being IC involves way more than just "choosing your own work schedule" as others have suggested here. Being IC with your own accounts can be very lucrative, but know the time involved before you take that leap. Personally, I would rather have my own accounts than working for someone else as IC because the pay is much better (cuts out the middle man), but accounts are very hard to find these days. When I had my own accounts I averaged $35-$40 an hour, but sometimes had to wait weeks to get paid and was on call 24/7. I lost those accounts eventually to a service. When I worked IC for someone else with their own accounts, it was a nightmare just getting paid and the hours were all over the place depending on STATs and others taking time off. IC does not always mean you work when you want to if you want to keep the job.

I am so much happier now working for a National employee status with way more free time (I did get to choose a schedule that works for me), dependable paychecks, cheaper insurance, getting paid time off, and someone else to worry about TAT, etc.

Good luck whatever you decide. It is good you are researching this.

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