When hiring managers embark along the process of evaluating employee options for an open position in their organization, they have to consider all of the potential freelance and full-time candidates. What is the difference between these two pools of potential employees? Freelancers are the more cost-effective hiring option, to start. Interestingly enough, though they have higher rates by the hour than full-time employees, employers actually save as a result of hiring freelance employees. The reason being that, regardless of if an organization pays the freelancer more, they’re not offering these employees access to health insurance, retirement, or other benefits that full-time employees are allotted. Which further exacerbates the point of saving on the hire. In addition to this saving, organizations are also faced with less tax responsibility as a result of them not having to cover the Medicare and Social Security expenses of any freelancer. This isn’t to say organizations are exempt of tax responsibilities related to freelancers, but rather that these freelancers will have to cover these responsibilities on their own through a self-employment tax. While it’s clear that freelancers do provide some unique benefits to the organizations that hire them, there is a lot to consider before being willing to do so. For more information on whether or not your organization should bring in a freelancer or a full-time employee, consult the infographic accompanying this post.
Hiring A Freelancer vs. Full-Time Employee this infographic was contributed by Tab Service Company, a premier choice for any of your needs related to 1099 nec online filing
