As an independent contractor, you are self-employed and you produce a specific type of work product in a determined amount of time. Some independent contract work is considered a gig, such as performing music at events or driving for a ride-share service, and other times it’s considered a professional service such as producing fine art or landscaping.

What’s important is that you have a vision in front of you about how this work is going to not only bring in income, but also how it might be personally gratifying and sustainable.

The Gig Economy refers to a growing segment of the labor market, in which clients contract with workers, often via apps, for specific tasks and activities. The gig economy has endless options and often does not require high educational attainment.

Gig opportunities include:

• Driving a car for ride-share services such Uber or Lyft.
• Selling products on sites such as Etsy or eBay.
• Performing music at paid gigs and concerts.
• Working for freelance labor apps such as TaskRabbit.
• Renting space in your home with sites such as AirBnB
• Any one-time, task-based job.

Professional services exist in a variety of industries. In addition to participating in the gig economy, individuals may choose to leverage their expertise, skills, abilities, certification, and professional and academic training to offer professional services to the public. The ability to provide them requires experience, passion for a specific type of work, and in some instances, licensing or educational attainment.

There are many different types of independent contract work you can do, allowing you to leverage all the skills, experience and knowledge that you have accumulated over time both inside and outside of school. You can start in the gig economy and work toward offering specialized professional services.

Some examples of professional services may include:

• Accounting
• Advertising
• Babysitting
• Computer Programming
• Construction
• Cosmetology
• Dog Walking
• Engineering
• Fine art
• Graphic Design
• Landscaping
• Legal
• Medical
• Payroll Management
• Photography
• Taxes
• Tutoring
• Real estate
• Website Design
• Writing and editing

What kind of skills do you offer to clients?

Be honest about what work you are particularly good at producing. Having an honest understanding about your skills and which of them excite you the most gives you a good sense of which direction you might take as an independent contractor.

What is it about this work that excites you?

There’s money, yes, but why are you interested in this particular work?

Perhaps you want to reap some reward for a skill you perfected, or maybe you simply love music, accounting, or teaching that high-intensity fitness class. Maybe you have an old skill you can breathe new life into and make some extra money. Or, maybe the market is right for your talent and you can take advantage of that skill today.

Whatever it is, your reason for becoming an independent contractor should be something that excites, motivates, and rewards you personally and financially. So what is it for you?

Who will pay you for your services, and how much are they willing to pay?

Think about the following questions:

• With whom will you interact on a regular basis?
• Who do you see as your customers?
• What do you know about them?
• Do you know how much they are willing to spend on the product you’ll make or the service you’ll provide?
• How might you go about contacting them?

What kind of payment terms do you prefer? Do you need to be paid immediately, or can you offer a longer term payment option to clients? 

While it’s always nice to get paid up-front or at the completion of a project, it’s a good idea to have a sense about how you’ll get paid. You can negotiate a down payment, installments, balance due at completion, and a processing period in case invoices need to run through their accounting department.

For example, one common practice in receiving payments is Net 30. Under a Net 30 payment plan, you’d receive payment within 30 days from when you submit an invoice.

How many hours a week do you expect to work for this gig or professional service?

How many hours you work as an independent contractor depends on many factors such as your availability, customer need, or the anticipated duration of the project. It’s wise to still have a sense of how you’ll invest your time, and how much of it you’ll give to work and how much to life. Keep it balanced – burnout is a real thing!

The Immigtration Reform and Control Act of 1986 (IRCA) states that it is illegal to knowingly employ unauthorized workers in the United States.

IRCA requires employers to verify that everyone is legally authorized to work in the US using the I-9 System. An exception to this rule, however, is that an individual or entity is not required to obtain Form I-9 from independent contractors or sporadic domestic workers.

This is important because individuals who fail to comply with Form I-9, or who knowingly hire or contract undocumented individuals, may face civil fines, criminal penalties, or debarment from government contracts. The form provides a paper trail of sorts, and verifies that they knowingly are hiring an individual with work authorization.

An individual is an independent contractor if the payer has the right to control or direct only the result of the work and now what will be done and how it will be done.

The earnings of an independent contractor are subject to self-employment tax.

The IRS Common Law Rules determine the rubric for determining if one is an independent contractor or an employee, which include behavioral control, such as facts that show whether the business has a right to control how the contractor does the task for which the individual was hired to do.

In terms of financial control the IRS is concerned with business aspects such as how a worker is paid, how expenses are reimbursed, who provides equipment and tools, and so on.

Lastly, the Type of Relationship examines facts that show written contracts, financing of benefits, permanency of the relationship, and more. More information about these guidelines can be found in the IRS Employer’s Supplemental Tax Guide (Publication 15-A).

Now that you have an idea of the type of work you would like to do as an independent contractor, you will need to start thinking about marketing your services. You can begin by creating a profile in several marketplaces, but you will likely have to do additional marketing.

Below are just a few ways to promote and market yourself:

Create business cards and add a QR code to link to your website or LinkedIn profile.

• Purchase inexpensive business cards: www.vistaprint.com
• Create your free website: www.wix.com
• Create free QR codes: www.qr-code-generator.com

Consider creating a flyer/brochure to promote your services.

• Use free Microsoft Office templates: templates.office.com/en-us/brochures

Post an ad on social media promoting your services.

• Learn about FB ads: www.facebook.com/business/ads

IRS Guidelines for Independent Contractor work

Common Law Rules (IRS Publication 15-A, 2016 Edition)

Application for IRS Individual Taxpayer Identification Number (W7 form)

Request for Taxpayer Identification Number and Certification (W9 form)

1099 form for Miscellaneous Income

Immigrants Rising’s Introduction to Working for Yourself Guide

Immigrants Rising’s Guide to Professional Licensing

Small Business Administration (SBA) Tips for Self-Employed & Independent Contractors

Independent Consultant Network

Freelancers Union

Sample: Independent Contractor Agreement (California)