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An independent contractor agreement allows a client to hire a contractor for specific tasks, sometimes referred to as a 1099 agreement, named after the IRS form contractors must file. Unlike employees, independent contractors do not have taxes automatically deducted from their payments and are responsible for paying taxes themselves. This distinction highlights legal differences between contractors and employees. Independent contracting typically offers more flexibility but less stability. Over the past decade, the number of independent contractor positions has increased significantly, partly due to technological advancements. Both employers and workers should consider key factors when drafting an independent contractor agreement, starting with the eligibility of the work.
