Once your pet business begins to grow and the business is coming in on a steady basis you may consider hiring some assistance. The trend in small pet business is hiring an Independent Contractor or an IC as they are commonly referred to.  Here are some questions that the IRS may ask to ensure you do in fact have an independent contractor and not an employee.

Here are some questions the IRS asks in determining whether a new hire is truly an independent contractor or an employee masking as one (so the employer can avoid…well, you know):

1. Does the worker set his or her own hours?

2. Who makes the rules for how and where the work will be done: employer or worker?

3. Does the worker furnish his or her own tools and equipment and hire his own assistants if needed?

4. Does the person have a workplace (home office, for example) that’s separate from the employer’s premises?

5. Can the individual work for other companies?

6. Is the worker paid on a per-job or a commission basis?

7. Does the person send you invoices for his services?

8. Is there a written “independent contractor” agreement between worker and employer?

If the answer to these questions is yes, you’ve successfully hired the person as an independent contractor and avoided the employee issues.

Take care to ensure you definitely have an Independent Contractor and not an employee, or the IRS may slap you with fines and all that ‘employee’ paperwork. See your accountant, bookeeper, or VA (virtual assistant) if you need further help with this one.

*adaped from Entrepreneur.com*

Post to Twitter