Many individuals have thought about business ownership, but happiness and independence does not always require an expensive storefront. It may be as simple as working from home as a self-employed business owner or as an independent contractor. To get started off right, it can be helpful to understand the steps to take to get set up as an independent contractor or to being self-employed and running a business. There are a number of resources available to individuals starting a business, as appropriate guidance can always be helpful when starting a business.
For individuals seeking to be self-employed, it can be important to understand sole proprietorships and have a solid understanding of tax information and requirements as it relates to self-employment and sole proprietorships. There can be important liability and tax concerns to be familiar with when endeavoring into a self-employment situation and a sole proprietorship business structure.
Independent contractors starting a business will also want to understand tax consequences and determine what licenses and permits they may need. Independent contractors should also draft a standard legal agreement they will use with clients for their services. Because the standard agreement is legally binding, and is an important day-to-day part of the independent contractor’s business, it can be helpful to carefully consider its contents and draft it with care.
Having the legal and tax concerns involved in being self-employed or becoming an independent contractor properly lined up and accounted for can be important to the success of a business. Knowledge and understanding of, as well as guidance for, the important legal decisions that need to be made when starting any business can be invaluable. Failing to properly address these areas could lead to unwanted consequences that could be disadvantageous and costly.
Source: U.S. Small Business Administration, “Self Employed & Independent Contractors,” Accessed Jan. 11, 2016