How does my foreign-owned LLC decide if a worker is an employee or independent contractor?
I have a foreign-owned LLC and I'm working with several people in the U.S. — a web developer who works from home on their own schedule, a virtual assistant who works set hours, and a marketing consultant who handles specific projects. I've been paying them all as independent contractors with 1099s. But I've read that misclassifying employees as contractors can lead to huge penalties. How do I know if any of these workers should actually be classified as employees? What factors does the IRS look at?
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