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An independent contractor agreement is a contract that allows a client to hire a contractor for a specific job. Also known as a 1099 agreement, independent contractors must file their taxes themselves, unlike employees who have taxes automatically deducted. This is just one of many legal differences between contractors and employees. While contracting offers more flexibility, it also comes with less stability. The rise in independent contractor positions is due to changing technology. When creating an independent contractor agreement, consider if the work is eligible.