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Megan C
Megan C , Certified Public Accountant (CPA)
Category: Finance
Satisfied Customers: 16539
Experience:  Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level
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I am being offered an independent contractor job. The contract

Resolved Question:

I am being offered an independent contractor job. The contract has a clause stating that the Subcontractor agrees to accept exclusive liability for the payment of all employment taxes or contributions for unemployment insurance or old age pensions or annuities or social security payments which are measured by the wages, salaries or other remuneration paid to the Subcontractor or the employees of the Subcontractor, if any, and to reimburse and indemnify the Contractor for such taxes or contributions or penalties which the Contractor may be compelled to pay. The Contractor also agrees to comply with all valid administrative regulations respecting the assumption of liability for such taxes and contributions.

What if the IRS determines my position is as an employee? Would this make me liable to pay back taxes the IRS would assess on the employer (Contractor)?
Submitted: 3 years ago.
Category: Finance
Expert:  Megan C replied 3 years ago.

MyVirtualCPA :

Thanks for your question, and thanks for using JustAnswer.com

MyVirtualCPA :

If your position was deemed by the IRS to be that of an employee, the contractor would be the one with a steep tax liability, not you

MyVirtualCPA :

You will pay your social security/medicare taxes via your schedule C

MyVirtualCPA :

So your taxes will be paid. They will have to pay their payroll taxes if you are deemed to be an employee

MyVirtualCPA :

Typically, though, when you have an agreement like the one you signed, you are a contractor and not an employee

MyVirtualCPA :

Is there anything else that I can assist you with today?

Megan C and 3 other Finance Specialists are ready to help you
Expert:  Megan C replied 3 years ago.
Thanks, Gary for your positive rating. Please come back and visit MyVirtualCPA any time you need a tax, finance, or social security question answered. It was a pleasure working with you today.