Steps to handle contracted help

Written By Gary Spirer Published March 28th, 2010

If you are self employed and run a small business but do not do enough output to require full time employees you may occasionally have to hire out work. What can you do?

Step 1 Understand contracted work
You will hire out contracted work or you will hire a freelancer when work is needed to be complete. You may hire someone regularly or you may have a one-off situation where you need assistance. Either way is fine, but there are some things to consider.

Step 2 Know the reality
Freelance workers are generally speaking, less accountable. They do not have a “job” with you and do not depend on you for their sole income. In a sense, they are self employed too. This is fine, but they may not do the work on time, they may not be a perfectionist at it like you are, they may not meet due dates and you may at times have trouble getting in touch with them. Because of this you may want to create a contract.

Step 3 Understand how taxes apply to freelancers
Also, when you hire someone for freelance you do not need to worry about their taxes. That is, until you pay them more than $600 within a calendar year. Once your freelance “non-employee” is paid more than $600 by you, you will need to file a 1099 for this freelancer. It is very easy to take care of your 1099s but during the year you will want to make sure of the amounts of money you pay your various freelancers.

It’s that simple. Remember, freelancers can save time and money, but a contract may be needed to guarantee good work. Please visit for more great business advice.

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