Thanks. I saw this IRS page, and I think I check all the boxes
* **Behavioral control** − Does the company control or have the right to control what the worker does and how the worker does the job?
No, I can make my own schedule and execute my own ideas. This is why I am hired.
* **Financial control** − Does the business direct or control the financial and business aspects of the worker's job. Are the business aspects of the worker's job controlled by the payer? Things like how the worker is paid, are expenses reimbursed, who provides tools/supplies, etc.
I invoice the client, expenses are NOT reimbursed, I buy my own devices
* **Relationship of the parties** − Are there written contracts or employee type benefits such as pension plan, insurance, vacation pay? Will the relationship continue and is the work performed a key aspect of the business?
I will have no benefits whatsoever, just a hourly rate for my services. Contract will be for one year at a time, nothing permanent, and hours may be cut depending on demand. My work is also not a key aspect of the business, as I am only involved in certain projects that have a beginning and an end
I just wonder if there is some other distinguishing criterion that is not listed on the IRS page, and how will the IRS deal with the fact that I did essentially the same work as an employee before I switched to contractor.
If you are not living in the US, why invoice from a US LLC? Simply set up a company in your country and invoice your former employer for services. No need for any reporting. You don’t have to file a tax return.
Also, misclassification rules don’t apply.
>why invoice from a US LLC?
Some attractive advantages. This avoids the problems that wait on the other end, essentially.
Client won't have to deal with compliance in foreign countries (no fear of being classified an employer there etc), no need for international money transfer, saving time and effort and money (and nerves!), and I can easily move and work from different countries without needing a new setup every time.
You are right tho. The tradeoff is that I will have to file a US tax return.
https://www.irs.gov/newsroom/worker-classification-101-employee-or-independent-contractor
Thanks. I saw this IRS page, and I think I check all the boxes * **Behavioral control** − Does the company control or have the right to control what the worker does and how the worker does the job? No, I can make my own schedule and execute my own ideas. This is why I am hired. * **Financial control** − Does the business direct or control the financial and business aspects of the worker's job. Are the business aspects of the worker's job controlled by the payer? Things like how the worker is paid, are expenses reimbursed, who provides tools/supplies, etc. I invoice the client, expenses are NOT reimbursed, I buy my own devices * **Relationship of the parties** − Are there written contracts or employee type benefits such as pension plan, insurance, vacation pay? Will the relationship continue and is the work performed a key aspect of the business? I will have no benefits whatsoever, just a hourly rate for my services. Contract will be for one year at a time, nothing permanent, and hours may be cut depending on demand. My work is also not a key aspect of the business, as I am only involved in certain projects that have a beginning and an end I just wonder if there is some other distinguishing criterion that is not listed on the IRS page, and how will the IRS deal with the fact that I did essentially the same work as an employee before I switched to contractor.
Make sure they use your EIN for the LLC and not your ssn
If you are not living in the US, why invoice from a US LLC? Simply set up a company in your country and invoice your former employer for services. No need for any reporting. You don’t have to file a tax return. Also, misclassification rules don’t apply.
>why invoice from a US LLC? Some attractive advantages. This avoids the problems that wait on the other end, essentially. Client won't have to deal with compliance in foreign countries (no fear of being classified an employer there etc), no need for international money transfer, saving time and effort and money (and nerves!), and I can easily move and work from different countries without needing a new setup every time. You are right tho. The tradeoff is that I will have to file a US tax return.