If I had to identify the single most important decision a business must make regarding how an individual is to be paid for the services he or she provides it would be classification of the individual as an employee or as an independent contractor.

Improperly classifying employees as independent contractors can create serious long-term liabilities for a business. If an individual that the business treated as an independent contractor is later determined to have been an employee by the IRS or the state of Florida, the employer can be held responsible for the payroll taxes that should have been withheld from the individual along with the employer taxes that would have been due, and the penalties for failure to pay these taxes.

Many new businesses look to reduce their costs by using independent contractors rather than employees to perform vital services.

By using independent contractors they save on payroll taxes, workers compensation insurance, and employee benefits. Properly used independent contractors can save a business money, but be careful, just because you call someone an independent contractor does not mean they are one.

In general, an independent contractor is an individual who is in business for him or herself and maintains independence from the business he or she is performing the service for, whereas an employee works for and performs services under the control of the business receiving the service.

The IRS and the state of Florida base worker classification on “common-law” factors designed to gauge the amount of control the business has the right to exercise over the worker. Two frequently cited factors of an employee-employer relationship are that the business is maintaining the right to discharge the worker at will and / or the business is providing the worker tools and a place to work.

By comparison, individuals who are truly independent contractors generally provide their own tools and work place, they have business licenses, and are engaged to complete specific projects and cannot be terminated without cause from a specific project. There are no hard-and-fast rules as to who is an employee and who is an independent contractor. All possible factors pertaining to the business’s control and the worker’s autonomy must be taken into account.

As you can see, there is no easy answer as to when an individual qualifies as an independent contractor. There is however no penalty or liability for misclassifying independent contractors as employees. As a general rule when in doubt the safest classification may be to choose employee.

Hiring an independent contractor to help you with home improvements has pros and cons.

You can save money by avoiding hiring a general contractor but then, when working with an independent contractor, you can end up with low quality work or someone who has abandoned the job halfway through. If the independent contractor hasn’t lived up to what they said they would do, you can end up spending more on a job than hiring a general contractor.

How Can You Find Quality Sub-Contractors? – There are starting to be resources online that can help you find reputable contractors. Google maps sometimes has reviews about businesses there. Those are difficult to depend on though, but they can be easily fabricated. Ask around with friends or try calling other businesses to see what independent contractors they have used in the past.

Learn About The Project Yourself – The more you know about what a project entails the better able you will be to analyze the bids you receive.

Learn about the project online and see what the job will require. Price out some of the materials at your local hardware store. That way when the contractor is giving you a bid you will have an idea of how realistic his bid is and how long it will take.

Get Multiple Bids – Make sure you have at least 5 different independent contractors bid on your project. The more quotes you have the more likely you are to pick someone who is reputable, honest and inexpensive.

Ask For References – Make sure you contact references from the contractor of people they have worked with before.

The small business retirement plan is something that gives the owner something to look forward to in the future. The plans offer some security, and the family can find some relief from funeral, and related experiences after your death. Since each plan is different, it pays to examine the plans closely before signing papers.

One of the best ways to learn about small business plans is by searching the Internet. You can use the search tools online to search through the many providers, plans, prices, and other related subjects. Small businesses can open business accounts online that offer them tools for managing their finances, including their retirement monies. Another alternative is the Simplified Employee Pensions. These plans are the most effective and have the lowest fees on plans. Employees have a few advantages with this plan.

Joint Ventures, independent contractors and sole proprietors, etc, can choose the SEPS plans. This simplified plan has Secretarial fees that are commonly lower than some of the IRA plans. That Is the individual retirement accounts. There is minimal recording keep with these plans.
SEP give employers’ larger contribution options, some people prefer the Uni-K plans if they are sole proprietors. SEP has some disadvantages. One of the disadvantages is that the plans are complex for business owners with employees.

Some of the basic Uni-K plans include the 401k solo, single, personal, individual, and the plans available for special practitioners. Home workers may prefer this plan as well. SEP contributions put into an account goes into a 100% vest right away. Tax deferments grow on employees’ SEP account, which builds up from the contributions. The employees do not need to worry about tax owed to the IRS. There aren’t any taxes on the dividends, gains from capital, or interest incurred. Once the employee begins to make withdraws from the account however, then they will have to pay taxes.

With the small business retirement plan, the employees must deduct funds from the account after he or she turns 70 1/2. The employers can make contributes up until then. If anyone “59 1/2″ draws funds from the account, they may have to pay up to 10% on penalties. There is a maximum limit on contributions, which are subject to change each year.

You can set more money aside on the Simplified plans than you can on typically individual retirement accounts. Moreover, employers can enjoy deductibles on taxes. The taxes are excluded from salary as well, since it is not considered a recompense or reimbursement.

Small business owners before did not have many retirement options available. Today, because so many people are getting into small business, there are plenty of insurance plans available. If you are searching for small business retirement plan then go online and do some research. It pays to read all the details on a given plan and compare the plan with other small business plans to ensure you get the most coverage for the best price possible.