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This sounds similar to how IR35 operates in the UK. It’s a total pain and has made contracting far less attractive for both parties. I had to explain the purpo
by nerdawson 3y ago
This sounds similar to how IR35 operates in the UK. It’s a total pain and has made contracting far less attractive for both parties.
I had to explain the purpose of an umbrella company to a client in the US recently. Perhaps that structure will become the standard way for contractors to work over there too.
- bombcar 3y agoThat structure already exists in some places in the US, often mainly to pool HR expenses and healthcare. I suspect it will grow significantly. The biggest risk for this is people who "really are" independent but are currently working on a long-term contract for a company, and it sounds like we'll have to wait for case-law to apply. I suspect the rule of thumb of "you make $50/hr or more effective" will probably continue to hold.
- nerdawson 3y agoA big part of the problem with how the similar rule is implemented in the UK is that determining status falls to the company hiring the contractor. The employer is legally liable for lost tax revenue if they fail to determine status correctly. The result: most employers decided that contractors were inside (treated like an employee for tax purposes with none of the benefits of employment) rather than risk getting it wrong.