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 Vermont, an independent contractor agreement is a legal document that outlines the relationship between a client and a contractor who is hired to perform services. This type of agreement is important for clarifying that the contractor is not an employee and therefore the client is not responsible for withholding taxes or paying FICA taxes on behalf of the contractor. The agreement should be in writing to ensure that both parties understand their obligations and the terms of the service arrangement. Key elements typically included in such an agreement are the scope of work, the duration of the project or service, payment terms, and clauses related to confidentiality, non-solicitation, and how disputes will be resolved. It's important to note that while federal law, including the Internal Revenue Code, provides a general framework for independent contractor status, Vermont may have additional regulations or statutes that govern the specifics of independent contractor relationships within the state. Therefore, it is advisable for parties entering into an independent contractor agreement in Vermont to consult with an attorney to ensure that their contract complies with all applicable state and federal laws.