by Joe Wallace

The picture of the snake implies your boss intentionally did something wrong in hiring you as a freelance writer, editor, copywriter or photographer. That’s actually probably not the case. But since I’m an evil sort of person, I can assume the worst with impunity.

To be honest, it’s more a case of genuine ignorance in many cases, which is why I’m running this piece here–do you know what the rules for freelance work are? Do you know as an employee OR as manager what your obligations when it comes to the IRS definition of freelance labor?

Let me share a little story.

My most recent long term freelance work included a great, high-paying gig as an editor and project manager. In the beginning, I fit the IRS definition of a freelancer, or what the IRS calls a “non employee”. But over time as my role increased and my duties changed, I did in fact become something the IRS might consider an employee if somebody took five seconds to think about it. Here’s chapter and verse from IRS Publication 15:

“Employee status under common law. Generally, a worker who performs services for you is your employee if you have the right to control what will be done and how it will be done. This is so even when you give the employee freedom of action. What matters is that you have the right to control the details of how the services are performed.”

The IRS takes this sort of thing very seriously because when you are an employee, your boss is held liable for a variety of withholding and deductions. So who isn’t an employee? Again, from the IRS:

“Generally, people in business for themselves are not employees. For example, doctors, lawyers, veterinarians, construction contractors, and others in an independent trade in which they offer their services to the public are usually not employees. However, if the business is incorporated, corporate officers who work in the business are employees.”

The IRS also has plenty to say about who an independent contractor (freelancer, for our purposes) is and how they work. An independent contractor is only considered such “if you, the person for whom the services are performed, have the right to control or direct only the result of the work and not the means and
Statutory Employees methods of accomplishing the result.”

What did that mean in my case? The moment I started having to sit in on regular meetings, get material turned in by a certain hour of the day, or any other restriction on how and when I did it, my employers were in technical violation of the rules. The IRS could hold them liable for all withholding and taxes on my behalf, and they’d have to pay.

If you work as a freelancer or want to hire freelancers, I strongly urge you to have a good hard look at IRS Publication 15, the Employer’s Tax Guide before the IRS takes a long, flinty Clint Eastwood look at your business, lights up one of those little Italian cigars and blows smoke in your face.