Independent Contractor Status

IRS Section 1706 Compliant for Your Safety and Peace of Mind

Because of recent decisions against Microsoft on their classification of statutory employees as independent contractors, we would like to reassure potential clients that H&A Systems Engineering is fully compliant with IRS regulations (Section 1706) regarding independent contractor status. In addition to our vigilance on the 20 factors, our firm:

• Includes multiple people generating revenue from more than one source
   
  
• Has a staff of California licensed professional engineers
   
  
• Is a licensed business
   
  
• Offers its services to the public

The key element in the decisions against Microsoft was that the independent contractors in question were single individuals who contracted only with Microsoft. We do not do business like that. We only provide services as an independent business entity and have done so exclusively for over six years.

Furthermore, we negotiate contract terms to ensure our compliance with IRS regulations and will not accept terms that violate IRS Code Section 1706. This protects all our past, present and future clients against reclassification.

In summary, if we wanted W-2s, we would go get jobs.

Worksheets and Sample Contracts for Independent Contractors

• IRS Section 1706 Independent Contractor Compliance Worksheet (PDF 8 kB)
   
  
• Sample Nondisclosure Agreement (PDF 8 kB)
   
  
• Sample Training Contract (PDF 8 kB)
   
  
• IEEE Sample Consulting Contract (PDF 28 kB) for large contracts