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Hiring Employees An employer must generally withhold income taxes, withhold and paysocial security and Medicare taxes, and pay unemployment taxes on wages paid to anemployee. An employer does not generally have to withhold or pay any taxes on payments toindependent contractors. Common-law rules. To determine whether an individual is an employeeor an independent contractor under the common law, the relationship of the worker and thebusiness must be examined. All evidence of control and independence must be considered. Inany employee-independent contractor determination, all information that provides evidenceof the degree of control and the degree of independence must be considered. Facts that provide evidence of the degree of control andindependence fall into three categories: behavioral control, financial control, and the type of relationship of the parties. Determination of Employee Work Status for Purposes of FederalEmployment Taxes and Income Tax Withholding. IRS help. If you want the IRS to determine whether a worker is anemployee, file Form SS–8, Determination of Employee WorkStatus for Purposes of Fedear (ITIN). - Form W-9 is used by persons required to file information returns with the IRS to getthe payee’s correct TIN. For individuals, the TIN is generally a social securitynumber (SSN). Individual Taxpayer Identification Number (ITIN). - Form W-9 is used by persons required to file information returns with the IRS to getthe payee’s correct TIN. For individuals, the TIN is generally a social securitynumber (SSN). Show the full name and address as provided on Form W-9 on theinformation return filed with the IRS and on the copy furnished to the payee. Important References Publication 15ABonn Hotel Employer’s Supplemental Tax Guide |
