1099 v. W-2
In today’s economy, businesses tend to engage independent contractors (ICs) rather than employees to avoid the costs, taxes, and bookkeeping formalities of hiring employees. This strategy, however, carries significant risks because state and federal agencies enforce strict legal guidelines and aggressively audit for compliance. For many businesses, an audit can be devastating because businesses that mis-classify workers are assessed substantial back taxes and penalties.
Most businesses focus mainly on costs when negotiating independent contractor agreements. Although costs are important, a skilled business lawyer will understand the important ramifications of contractual provisions that initially seem insignificant to most businesses. For example, a poorly drafted independent contractor agreement may not protect your confidential information and may force you to pay for work that was not done correctly.
Our business law firm can help you audit your current independent contractor agreements, negotiate new agreements, and represent you in a claim for breach of contract. Please give us a call at 360.630.3635.