How do you determine if a worker is an employee or an independent contractor?

The determination can be complex, but is based on whether the person for whom the services are performed has the right to control how the worker performs the services. It is not based merely on how the worker is paid, how often they are paid, or whether they work part-time or full-time.

There are three basic categories of factors that are relevant to determining a worker's classification:

  • Behavioral control
  • Financial control and
  • Relationship of the parties

For more information, visit the IRS website or speak with Bailey & Utley, CPAs for assistance with your taxes.