O Is the service you provide crucial to the business?
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O Do you get benefits such as paid leave, pension, or health care? If so, then this may be evidence of an independent contractor relationship. If so, you are more likely to be an employee. O Are you paid by the hour and get a weekly paycheck? If so, you are more likely to be an independent contractor. O Do you have the opportunity to make a profit or a loss? If not, and the expenses are high, it may indicate you are an independent contractor. O Are you reimbursed for all your business expenses? If so, you may be an independent contractor. O Did you need to make a significant investment in your work? (A significant investment is not always a certain dollar amount, but it must have substance.) If so, these indicate control and the possibility of an employment relationship. O Where to purchase supplied & equipment? O What assistants to hire to do the work?
![employee vs independant contractor expenses employee vs independant contractor expenses](https://sdglaw.com/wp-content/uploads/2021/01/IMG_6336-1-2048x1365.jpg)
You will need to keep careful track of all income.You may need to mail in estimated quarterly payments of income, Social Security and Medicare tax.Taxes are not withheld from the payment sent to you by the business(es) you work with.This equals roughly 15% of your income after business expenses are deducted. You pay all of the Social Security and Medicare taxes on your earnings.Your employer should provide you with a W-2 by January 31st of each year.Your employer is required to provide you with a W-2 that shows the income you were paid and the taxes that were withheld from your checks.
![employee vs independant contractor expenses employee vs independant contractor expenses](http://m-t-law.com/wp-content/uploads/2020/03/Employee-vs-Contractor.jpg)
Your employer should withhold income taxes, and your share of Social Security and Medicare tax, also known as FICA.If you lose your job you may be eligible for benefits. Your employer must pay unemployment taxes (FUTA) for you.Your employer must pay ½ of your Social Security and Medicare taxes.