Don't HR Alone #47 - Independent Contractor Classification

July 28, 2017

 

IRS Factor Explanations

Internal Revenue Service (IRS) Revenue Ruling 87-41 contains factors, commonly referred to as the 20 common law factors, that are used to assess whether a worker is an employee or an independent contractor for employment tax purposes. Although this revenue ruling is still valid today, the IRS has grouped the more relevant ones into the following three main categories of evidence that show whether a worker is an employee or independent contractor:

  • Behavioral Control covers facts that show whether the business has a right to direct or control how the work is done through instructions, training, or other means.

  • Financial