An independent contractor (also known as a freelancer) is a person or entity who agrees to work for another person or entity as a nonemployee. Because of the independent contractor’s status as a nonemployee, the contractor must pay their own Social Security and Medicare (FICA) taxes. And the person or entity hiring the independent contractor has no obligation to withhold income taxes from the contractor’s fees. It is important for the person or entity who hires a worker to properly classify the worker as an employee or as an independent contractor based on the IRS’s right-to-control test.

In West Virginia (WV), as in other states, the distinction between an independent contractor and an employee is significant for tax and legal responsibilities. Independent contractors, often referred to as freelancers, operate under a business-to-business relationship, providing services under the terms of a contract or agreement. They are responsible for paying their own Social Security and Medicare taxes, commonly known as self-employment taxes, and are not subject to tax withholding by the hiring entity. The classification of a worker as an independent contractor or an employee in WV is guided by the IRS's right-to-control test, which examines factors such as the degree of control the hiring entity has over the work performed and the worker's independence in performing their tasks. Misclassification can lead to legal and financial penalties. Therefore, it is crucial for hiring entities to accurately determine a worker's status based on the IRS guidelines to avoid potential liabilities.