A contractor agreement—also known as an independent contractor agreement, 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. A 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, hourly rate, and billing procedure; and (4) confidentiality, non-solicitation, and dispute resolution clauses.

A contractor may also operate as a corporation or multi-member limited liability company, for example, and the contractor agreement with such an entity will be similar to an agreement with an individual who is an independent contractor.

In Kansas, a contractor agreement is a legally binding document between a client and a contractor, where the contractor is engaged to perform services as an independent contractor rather than an employee. This distinction is important for tax purposes, as outlined by the Internal Revenue Code (26 U.S.C. §3509), which indicates that the client is not responsible for withholding taxes or paying FICA taxes for an independent contractor. The agreement should be in writing to ensure clarity and enforceability and typically includes details such as the scope of work, project duration, payment terms, and clauses related to confidentiality, non-solicitation, and dispute resolution. Whether the contractor is an individual, a sole proprietor, a single-member LLC, a corporation, or a multi-member LLC, the structure of the agreement remains consistent, focusing on the independence of the contractor and the specific terms of the service arrangement. It's important for both parties to clearly understand their rights and obligations under the agreement to avoid misclassification of employment status and to ensure compliance with applicable state and federal laws.