Answer

Hello again pat,

No, there is no limit to the number of employees that you can classify in this manner.

As far as how you would classify this as a business expense, it would come under the classification of "contract labor" -- similar to wages, but a separate category.

There is an advantage to you as the business owner. By paying the counselors as independent contractors as opposed to paying them as employees, you are not responsible for tpaying the employer share of social security and medicare taxes. When you have someone who is a regular employee, you must match their ss and medicare contributions, which combined amounts to 7.65% of their gross pay.

In addition, you would not be obligated to pay any unemployment taxes as you would for regular employees.

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Thank you again pat, and let me know if you have more questions.