Classification Of Independent Contractors Major Issue For Micro-Businesses
Along with the usual allocations for priorities like defense and education, the Obama Administration’s recently released FY2011 Budget also includes new regulations on independent contractors that may have a direct impact on small businesses. Almost 50 percent of the self-employed and micro-business owners were opposed to one of the proposed regulations, while opposition to two other proposed regulations was over 70 percent for both, according to a study undertaken by the NASE.
Forty-one percent of respondents also indicated that they would be less likely to use an independent contractor if they were required to comply with a contractor’s request to withhold a flat rate percentage of gross payments for federal tax purposes.
“New proposals on Capitol Hill that would require businesses to comply with voluntary withholding measures make it less appealing to hire independent contractors, simply put,” commented NASE’s Executive Director, Kristie Arslan. “It would negatively affect vast numbers of the self-employed – a severe consequence of the IRS collecting a few extra dollars per worker.”
To view full survey results, visit the NASE Research page online.