This tax season we picked up a new tax client. This person is apparently an independent contractor.

Based upon the facts of the case, I disagree.  I believe this person to be an employee and that his employer has him paid as an independent contract to save on the costs of employment.

The client himself has only one client, so he only has a single 1099-M.  This company keeps him working just about every day.  They provide all of the necessary equipment for him to do his job.  But he has to transport the equipment from client site to client site.  Then at the end of the day he returns the equipment and the work performed.

To me this sounds like an employee not an independent contractor.  I have discussed this situation with my client, he is unwilling to rock the boat, because he needs and likes his job (work).  Believing that he would be terminated if he were to challenge his setup.  He is probably correct.

So my client pays both sides of FICA as well as income tax on his earnings.  He has no real business expenses to deduct on his Schedule C.

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