What's the difference between an employee and an independent contractor?

An independent contractor is a small businessman working for himself, whereas an employee works for someone else. An example of an independent contractor is a computer consultant, who can show up whenever he wants (or send someone else instead), do his work however he choses to without being directed by a supervisor, and gets paid a flat fee regardless of how long the work takes. For more information on the tests used by the IRS to determine if someone is an independent contractor or an employee, visit the IRS website http://www.irs.gov/businesses/small/article/0,,id=99921,00.html or the American Institute of Certified Public Accountants http://www.aicpa.org/pubs/jofa/may2004/stump.htm

 

Jason Heath has posted some interesting reading on the reality of the freelance music business: 

http://www.adaptistration.com/artsaddict/2007/11/this-crazy-bu-1.html

Some of the points Jason makes include: