Independent Contractor

A self-employed taxpayer that controls his or her own employment circumstances, including when and how work is done. Independent contractors are not considered to be employees and must pay their own Social Security tax.

It is up to the employer to correctly classify each worker as either an independent contractor or an employee.

Independent contractors are considered to be sole proprietors of their own businesses and must report all income and expenses on Schedule C of Form 1040 (or Schedule E if they deal in rental property).

Their employers have no control over how and when they work, and do not pay any of their federal insurance contributions (FICA) or federal unemployment taxes (FUTA).

Investment dictionary. . 2012.

Look at other dictionaries:

  • independent contractor — n: one that contracts to do work or perform a service for another and that retains total and free control over the means or methods used in doing the work or performing the service compare employee Merriam Webster’s Dictionary of Law. Merriam… …   Law dictionary

  • independent contractor — UK US noun [C] (ABBREVIATION IC) TAX, LAW ► a person or company that supplies goods or services to another company: »An employer is free to use the services of employees or independent contractors. → Compare EMPLOYEE STATUS(Cf. ↑employee status …   Financial and business terms

  • Independent contractor — An independent contractor is a natural person, business or corporation which provides goods or services to another entity under terms specified in a contract or within a verbal agreement. Unlike an employee, an independent contractor does not… …   Wikipedia

  • independent contractor — Generally, one who, in exercise of an independent employment, contracts to do a piece of work according to his own methods and is subject to his employer s control only as to end product or final result of his work. Hammes v. Suk, 291 Minn. 233,… …   Black's law dictionary

  • independent contractor — One who, exercising independence in respect of his choice of work to be performed by him, contracts to do or perform certain work for another person according to his own means and methods, without being subject to the control of such other person …   Ballentine's law dictionary

  • independent contractor —    A person who is hired (i.e., contracted) to work for another to do a specific job, and who retains control over how the job is done. Such a contractor does not qualify as a statutory employee under the day to day control of the employer (i.e …   Business law dictionary

  • independent contractor — noun A person working independently, under a contract; a self employed person …   Wiktionary

  • independent contractor — /ɪndəˈpɛndənt ˌkɒntræktə/ (say induh penduhnt .kontraktuh) noun a person who undertakes to perform work for another for a consideration and who, unlike an employee, retains control in the performance of it, subject only to the terms of the… …   Australian English dictionary

  • independent contractor — noun : one that contracts to do work or perform a service for another and that retains total and free control over the means or methods used in doing the work or performing the service …   Useful english dictionary

  • contractor — con·trac·tor / kän ˌtrak tər, kən trak / n: one that contracts: as a: one that contracts to perform work or provide supplies b: one that contracts to erect buildings Merriam Webster’s Dictionary of Law. Merriam Webster. 1996 …   Law dictionary

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