The Contractor قصة
Annice Hemmerling
People such as doctors, dentists, veterinarians, lawyers, accountants, contractors, subcontractors, public stenographers, or auctioneers who are in an independent trade, business, or profession in which they offer their services to the general public are generally independent contractors. However, whether these people are independent contractors or employees depends on the facts in each case. The general rule is that an individual is an independent contractor if the payer has the right to control or direct only the result of the work and not what will be done and how it will be done.
If you are an independent contractor, then you are self-employed. The earnings of a person who is working as an independent contractor are subject to self-employment tax. To find out what your tax obligations are, visit the Self-Employed Individuals Tax Center.
You are not an independent contractor if you perform services that can be controlled by an employer (what will be done and how it will be done). This applies even if you are given freedom of action. What matters is that the employer has the legal right to control the details of how the services are performed.
If an employer-employee relationship exists (regardless of what the relationship is called), then you are not an independent contractor and your earnings are generally not subject to self-employment tax. However, your earnings as an employee may be subject to FICA (social security tax and Medicare) and income tax withholding.
Find the right general contractor for your renovation or remodeling project. Select your project type and enter your ZIP code below to get started. Or scroll down to read more about Contractor Connection.
I have been very satisfied with my contractor and their attention and cooperation from the very start. They have been great in understanding what I needed and were proactive in recommending resolutions. They have been very good at follow-up. The roof replacement is scheduled next, and I do not expect anything but the best results. It has been a very positive experience.
I will recommend Contractor Connection to all my friends. The contractor assigned to my project had a variety of very competent workers. They did an excellent job restoring my living room to look even better than it had before the mishap. All work was completed in an expeditious manner and above expectations.
Generally, you must withhold and deposit income taxes, social security taxes and Medicare taxes from the wages paid to an employee. Additionally, you must also pay the matching employer portion of social security and Medicare taxes as well as pay unemployment tax on wages paid to an employee. Generally, you do not have to withhold or pay any taxes on payments to independent contractors.
Before you can determine how to treat payments you make for services, you must first know the business relationship that exists between you and the person performing the services. The person performing the services may be:
An individual working remotely, for example, performing services for you from a location other than an office operated by you, is your employee under the common-law rules, if you can control what will be done and how it will be done. This is so even if the worker can choose to work remotely. What matters is that you have the right to control the details of how the services are performed.
Be aware that it can take at least six months to get a determination. A business that continually hires the same types of workers to perform particular services may want to consider filing the Form SS-8 PDF.
If you classify an employee as an independent contractor and you have no reasonable basis for doing so, then you may be held liable for employment taxes for that worker (the relief provisions, discussed below, will not apply). See Internal Revenue Code section 3509 for more information.
If you have a reasonable basis for not treating a worker as an employee, then you may be relieved from having to pay employment taxes for that worker. To get this relief, you must file all required federal information returns on a basis consistent with your treatment of the worker. You (or your predecessor) must not have treated any worker holding a substantially similar position as an employee for any periods beginning after 1977. See Publication 1976, Section 530 Employment Tax Relief Requirements PDF, for more information.
The Voluntary Classification Settlement Program (VCSP) is an optional program that provides taxpayers with an opportunity to reclassify their workers as employees for future tax periods for employment tax purposes with partial relief from federal employment taxes for eligible taxpayers that agree to prospectively treat their workers (or a class or group of workers) as employees. To participate in this voluntary program, the taxpayer must meet certain eligibility requirements. Apply to participate in the VCSP by filing Form 8952, Application for Voluntary Classification Settlement Program, in order to enter into a closing agreement with the IRS.
The site is secure.
The https:// ensures that you are connecting to the official website and that any information you provide is encrypted and transmitted securely.
Beginning April 1, 2024, federal contractors will be able to certify the status of their AAPs for each establishment and/or functional/business unit, as applicable. The deadline for certifying compliance is July 1, 2024.
If you receive an error, please contact the Contractor Portal Technical Help Desk for assistance through the OFCCP Contractor Portal Technical Help Request Form or call 1-800-397-6251, press 1 for English (or 2 for Spanish), then press 1 for Contractor Portal technical support.
Educational Institutions, contractors in U.S. territories, new federal contractors or subcontractors, and contractors who have not used the Contractor Portal before may register using one of the following options:
After registering a Parent Company in the Contractor Portal, a contractor should update records of its establishments and/or functional/business units. Companies with 100 or more establishments or functional/business units may request an upload of their establishments or functional/business units by using the Bulk Upload/Modification Template.
The U.S. Government Accountability Office (GAO) in its report, Equal Employment Opportunity: Strengthening Oversight Could Improve Federal Contractor Nondiscrimination Compliance (GAO-16-750), expressed concern that "OFCCP has no process for ensuring that the tens of thousands of establishments that have signed a qualifying federal contract have developed an AAP within 120 days of the commencement of the contract, or updated it annually."
OFCCP is currently only requiring annual certification for supply and service contractors. Contractors that are only construction contractors and not also supply and service contractors are not required to certify compliance, and should not register for the portal.
Contractors can add establishments or functional/business units by following the steps in Section 3.3 "Adding Establishment(s) or Functional/Business Unit(s) Records" of the Contractor Portal User Guide.
Contractors can close each establishment or functional/business unit which should not be listed under the Parent Company. Instructions for closing establishments or functional/business units are available in Section 3.5 "Updating Facility Status: Open/Closed" of the Contractor Portal User Guide. Examples of when to close an establishment or functional/business unit include, but are not limited to, the following:
It depends on whether the establishment maintains a separate AAP. If the establishment has fewer than 50 employees and maintains an AAP only for those employees, it must be included in the Contractor Portal. See 41 CFR 60-2.1(d)(2) (describing which employees should be covered in an AAP). If the establishment has fewer than 50 employees and does not maintain an AAP only for those employees, the contractor does not need to list the establishment in the Contractor Portal.
If an establishment with fewer than 50 employees still maintains its own AAP, update the headcount to match the AAP. If an establishment has fewer than 50 employees and the contractor chooses to incorporate the employees into a different AAP per the regulations at 41 CFR 60-2.1(d)(2), edit the status from "open" to "close" and update the employee headcount to zero.
Contractors can register for the Contractor Portal by creating a Login.gov account using an email and a secure password for entry into the portal. The OFCCP Contractor Portal User Guide includes detailed instructions on the registration process.
The Contractor Portal was designed to use the contractor's EEO-1 identifier to create a company profile. This is because any contractor who meets the thresholds for having an obligation to develop and maintain an AAP(s) also meets the thresholds for filing the EEO-1 report.
Contractors who meet the thresholds for having an obligation to develop and maintain an AAP(s) and have not yet filed an EEO-1 report should contact the OFCCP Technical Support Service Helpdesk at 1-800-397-6251. Callers should press 1 for English or 2 for Spanish, then press 1 to reach technical support for assistance. The technical support team will assign temporary identifiers for the parent company and all establishments and will assist with registration.
No. Educational institutions with federal grants need not register in the Contractor Portal if they do not meet the jurisdictional thresholds to develop an AAP. General FAQ #3 provides details on these thresholds.
The Contractor Portal currently supports EEO-1 identifiers that contain up to 15 characters. Contractors whose EEO-1 identifier contains more than 15 characters should contact the OFCCP Technical Support Service Helpdesk at 1-800-397-6251. Callers should press 1 for English or 2 for Spanish, then press 1 to reach technical support for assistance with registering.
03c5feb9e7