How to tell if someone is a W2 employee versus 1099 independent contractor?

Working with independent contractors is a cost effective, flexible, and agile way for companies to get specialized work completed. But did you know that 10-20% of all workers are misclassified, putting employers at risk for violating tax laws? This W2 Employee versus 1099 Independent Contractor Compliance Checklist equips you with the information needed to know the difference.

Before you discover half-way through the working relationship that you have misclassified a worker, use this checklist to check the behavioral, financial, and relationship control factors that affect classification.

Generally, the more control you exert on a worker, the more likely he or she is likely to be considered an employee versus independent contractor. The more direction and training you provide, the more you undermine independent contractor status. Given the numerous varying factors involved, we created this checklist to help make classification easy.

Proper classification saves you time and money.

Please refer to the IRS website for more insight or ask your employment attorney.