Most of us have a sense of what it’s like to be a boss or an employee, but what about being a temporary boss to freelance employees? Some small business owners—particularly sole proprietors—may find themselves in need of extra helping hands, and hiring freelancers isn’t the same as hiring employees. Building a reliable team of freelancers—let alone temporarily recruiting just one—takes time. You must also have your paperwork in order, from invoices to 1099 forms, and be ready to report that information when required. Whatever the cost, being able to hire freelancers may be instrumental in allowing you to scale your business in the long run.
As makeup artist and eyebrow expert Suzie Moldavon explains, some jobs require more than two hands. That’s when she brings in assistance from freelance hair and fashion stylists. In addition to making sure they do great work, she also has to make sure they get paid properly. In some cases, the company that hires Suzie will also give her a budget with which she compensates her freelancers herself. In other cases, her freelancers may be paid directly by the same client that hired her. Whatever the circumstance, Suzie keeps careful track of her payroll, because if she spends more than 0 for any single contractor for the year, then she is required by the IRS to send the contractor a 1099.
Just because you’re a small business owner doesn’t mean you don’t have big responsibilities. Hiring contractors and managing their payroll requires precise bookkeeping. Additionally, a firm understanding of compliance laws regarding hiring employees, be they full-time or freelancers, is essential to running your business smoothly. By working with an accountant or using the right bookkeeping software to help manage your payroll, you’ll be able to utilize the talents of others to help your business thrive.
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