There are over 30 million small businesses in the USA, with a large percentage of these employing at least one person.

If you have contracted employees, you’ll know how many headaches can come with the various administrative tasks you need to complete in respect of each one. If, on the other hand, you hire primarily 1099 workers, you’ll know it doesn’t have to be this way.

Once you learn how to pay 1099 employees, you’ll realize how much easier it is overall than having someone work for you under an employment contract.

Read on to learn more about paying 1099 employees and how to hire freelancers or gig workers.

What Is a 1099 Employee?

A 1099 employee is someone who works in a freelance or “gig” capacity. They are called 1099 employees because Form 1099 is the form they fill out when making tax returns.

Workers in many industries, such as content creation, choose to operate as freelancers. While there is less job security, there is much more freedom and the potential for rapid expansion.

How to Pay 1099 Employees

You can pay 1099 employees in much the same way as you’d pay for a professional service. Get your employees to invoice you for their services, cross-reference the information they give you with your own records, and release payment via your preferred platform.

Depending on your business, there may be a little more to it than that. If you’re creating pay stubs for your workers, this can take quite a lot of time. If you know the steps to create check stubs, the process will be a lot quicker.

Some freelance workers may wish to be paid in a certain way, such as per hour rather than per week. You should try to facilitate this if you can.

The Benefits of Hiring 1099 Employees

As the professional community moves online, opportunities in the freelance space are becoming more and more common. People no longer need to be close to a physical workplace and can complete projects for different employers in entirely different parts of the world if they want.

Employers can also benefit hugely from the gig economy. When you hire someone on a freelance basis, you can decide how much work to give them. If you use them once and don’t like what they produce for you, you can look elsewhere.

Compared to keeping a subpar employee on the books for months or years because firing them is too difficult, this is an ideal situation.

Growing Your Business With 1099 Employees

Once you’ve learned how to pay 1099 employees, you’ll realize it’s a much easier way of getting things done than employing someone under a normal contract. Your obligations to the workers are far lower, you can terminate their employment more easily if things aren’t working out, and you can use their services as frequently or infrequently as you’d like.

The information you’ve picked up here will help you to develop a stronger hiring strategy.

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