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 Oklahoma, a contractor agreement is a legally binding document between a client and a contractor, where the contractor agrees to provide services in exchange for payment. This type of agreement is essential for defining the relationship as one of independent contractor status rather than employment, in line with the Internal Revenue Code (26 U.S.C. §3509), which distinguishes between employees and independent contractors for tax purposes. The client is not responsible for withholding taxes or paying FICA taxes for an independent contractor. A comprehensive contractor agreement in Oklahoma should be in writing and typically includes details such as the scope of work, the duration of the project or service, payment terms including rates and billing procedures, and clauses related to confidentiality, non-solicitation, and how disputes will be resolved. These agreements are applicable whether the contractor is an individual, a sole proprietor, a single-member LLC, a corporation, or a multi-member LLC. It's important to ensure that such agreements comply with Oklahoma state laws and federal regulations to maintain the proper classification of the contractor and avoid potential legal and tax issues.