An independent contractor agreement—also known as a 1099 agreement or freelance contract—is a contract between a client willing to pay for the performance of services by a contractor (person, sole-proprietor, or single-member LLC) who is willing to perform the services. Under the Internal Revenue Code (26 U.S.C. §3509), an independent contractor is not an employee, and the client hiring an independent contractor is not responsible for tax withholdings and payment of FICA taxes. An independent contractor agreement should be in writing, and will usually address issues such as the (1) scope of the work (description of the services); (2) terms and length of the project or service; (3) payment details, including fee deposits and billing procedure; and (4) confidentiality, non-solicitation, and dispute resolution clauses.

In Montana, an independent contractor agreement is a legal document that outlines the terms of a business arrangement between a client and a contractor who will perform services as a non-employee. The distinction between an independent contractor and an employee is significant for tax purposes, as outlined in the Internal Revenue Code (26 U.S.C. §3509). Independent contractors are responsible for their own tax withholdings and FICA taxes, as opposed to employees, whose taxes are withheld by their employer. In Montana, it is advisable for an independent contractor agreement to be in writing to clearly define the scope of work, duration of the project or service, payment terms, and any confidentiality, non-solicitation, and dispute resolution provisions. This helps to ensure clarity and protect the interests of both parties, and it can also serve as evidence of the independent contractor status should any disputes arise regarding employment classification.