by Attorney Stephen Fishman

The benefits -- and drawbacks -- of working as an independent contractor rather than as an employee.

An independent contractor (IC) is a person who contracts to perform services for others without having the legal status of an employee. Most people who qualify as independent contractors follow their own trade, business, or profession -- that is, they are in business for themselves. This is why they are called "independent" contractors: They earn their livelihoods from their own businesses instead of depending upon an employer for a paycheck.

Good examples of ICs are professionals or tradespeople with their own practices such as doctors, graphic artists, accountants, plumbers, and carpenters. Independent contracting is also common in highly specialized or technical fields such as computer programming, engineering, and accounting. You can find ICs in almost every field, from construction to marketing to nursing. Any person who is in business for himself or herself qualifies as an IC.

Some people seek to become ICs, while others have the status thrust upon them. Whichever group you fall into, working as an IC has benefits and drawbacks.

Advantages of Working as an Independent Contractor

Independent contractors reap many rewards that regular wage earners may never experience.

• You are your own boss.   When you're an IC, you're your own boss, with all of the risks and rewards that entails. Most ICs bask in the freedom that comes from being in business for themselves. They would doubtless agree with the following sentiment expressed by one IC: "I can choose how, when, and where to work, for as much or little time as I want. In short, I enjoy working for myself."
  
  ICs are masters of their economic fate. The amount of money you make is directly related to the quantity and quality of your work. This is not necessarily the case for employees. ICs don't have to ask their bosses for a raise -- if they want to earn more, they just have to go out and find more work. And, because most ICs are not dependent upon a single company for their livelihood, the hiring or firing decisions of any one company don't impact ICs as they do employees.