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Fillable Form Independent Contractor Agreement

Independent Contractor Agreement is a written contract used by a person, business, or corporation that provides goods and services to perform work or provide services to another entity as a non-employee.


What is an Independent Contractor Agreement?

An Independent Contractor Agreement is a legally binding contract between two parties — a person or entity in need of special services, also referred to as hiring company, and a person or entity hired for a project or task, also referred to as a contractor — for a specific project or service. In general, professionals use the agreement when a project is short-term; in most cases, an independent contractor is paid on a per-project or job basis and not by the hour, unless agreed upon by both parties. Unlike an employment contract, an independent contract agreement clearly indicates that a person or company hired is not an employee for legal and tax purposes.

May also be called as Contract Labor Form, Subcontractor Agreement, Consulting Agreement, Freelance Contract, General Contractor Agreement, and Consulting Services Agreement, an independent contractor agreement is used by a hiring person or company to enter into a short-term agreement with consultants, freelancers, and independent contractors who can provide their products or services in exchange for monetary compensation.

By definition, an independent contractor is a professional or entity that is hired as a solo business owner and does not have employee benefits. When an individual is self-employed, he or she pays self-employment tax, Social Security, and Medicare, and income taxes — he or she handles everything independently. When a person or company hires an independent contractor, withholding anything from payments made to the latter is not the responsibility of the former. Thus, an independent contractor sends his or her own estimated tax payments to the Internal Service Revenue (IRS), the U.S. federal tax agency, every few months. The federal tax agency classifies an independent contractor as someone who is able to control the ways services are completed, is able to work on his or her own schedule, has control over work attire, is paid solely on commission, and uses his or her own tools and equipment when providing services.

An independent contractor agreement is advantageous, as it saves a professional or business from costly and time-consuming legal problems. That is why it is mandatory to clarify and define in the agreement that the professional or entity that will provide its products or services is an independent contractor and not an employee, stating details pertinent to the business arrangement such as the nature of the work and the start and end dates of the deal. Moreover, since the independent contractor is not an employee, it must be included in the contract that he or she is not eligible for or entitled to employee benefits, such as pension or retirement benefits, health insurance, paid leaves, and other benefits provided by an employer.

Being a necessary document to define job scope and limitations by enumerating partnership terms, not using an independent contractor agreement can be costly. While it allows the hiring company and the contractor to detail expectations and to state agreement terms and conditions, some of the possible consequences of not using it include misunderstanding in terms of payments, financial responsibility for work-related health problems, and lawsuits.

In addition, an independent contractor agreement helps protect both the interest of both parties. If you are a business owner seeking an independent contractor, the agreement shields you from liability issues while protecting your assets and proprietary information. If you are an independent contractor, it assures that you will get paid according to the terms mentioned in the contract and not be taken advantage of.

How to Write an Independent Contractor Agreement?

The content of an effective Independent Contractor Agreement should provide as much protection as possible to both parties entering the agreement. It must establish expectations and the scope of responsibilities, as well as terms on how the project should be completed and payments.

The specific terms and conditions in the agreement may vary depending on the industry and kind of products or services the independent contractor will provide. In general, it contains information on the professional or entity being hired and the hirer, the kind of services or products to be provided, the agreement start and end date, why the contractor is not an employee for legal and practical purposes, and the payment terms.

Using PDFRun’s Independent Contractor Agreement, you can create a legally binding contract in minutes. Follow the guide below to fill out the template accurately.

I. Parties requires the names and addresses of both the client and the contractor. It also details the date of payment for the services provided by the contractor.

II. Services Provided requires the list of services the contractor shall provide.

III. Payment requires the payment terms agreed upon by the parties.

IV. Due Date requires the terms or important dates the services shall be completed.

V. Expenses requires the information on whether expenses relevant to the services is shouldered by the contractor or reimbursable by the client.

VI. Liability Insurance requires information relevant to liability insurance.

VII. Termination requires the date of termination of the agreement.

VIII. Option to Terminate gives the client and the contractor terms termination of the agreement.

IX to XIX. Read the agreement terms and conditions to check if they suit your needs.

XX. Governing Law requires the state that would govern the agreement.

XXI to XXII. Read the agreement terms and conditions to check if they suit your needs.

XXIII. Additional Terms and Conditions requires other terms and conditions that the agreement should have.

XXIV. Read the agreement terms and conditions to check if it suits your needs.

To certify the independent contractor agreement, both the client and the contractor should provide their names and signatures and the date they signed the agreement.

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