A 1099 Contractor, more accurately referred to as an independent contractor, is a self-employed individual who provides specific services to a business under the terms of a contract or freelance agreement. Unlike traditional employees (W-2 employees), independent contractors are not subject to payroll taxes or most employment laws. Key characteristics include:

 

• Tax Responsibility: Independent contractors are responsible for paying their own federal, state, and self-employment taxes. They receive a 1099-NEC form for tax purposes, instead of a W-2 form.

​

• Work Flexibility: They often have the freedom to set their own hours and decide on the method of work completion, offering significant autonomy over their schedules and work environment.

   

• No Benefits: Independent contractors are not eligible for employment benefits provided to W-2 employees, such as health insurance, paid leave, or retirement plans.

​

• Contractual Relationship: Their work relationship is defined by a contract specifying the services to be performed, the duration of the agreement, and the compensation structure.