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Can I hire employees as independent contractors to save money on taxes in Oregon? What are the requirements?

Based on the information provided in the context documents, it is not recommended to hire employees as independent contractors to save money on taxes in Oregon. Misclassifying employees as independent contractors can result in legal and financial consequences.

Independent Contractor Requirements

To be classified as an independent contractor in Oregon, the contractor must meet three requirements as outlined in ORS 670.600 [2.1]:

  • The contractor must be engaged in an independently established business.
  • The contractor must be free from direction and control over the means and manner of providing services to others.
  • The contractor must have the appropriate licenses and certificates required to provide services.

Labor Contractor License Requirements

Labor contractors in Oregon are required to obtain a license and meet certain requirements, as outlined in ORAR 839-015-0140 and ORAR 839-015-0141 [1.1]. To obtain a labor contractor’s license in Oregon, an applicant must meet several requirements, including being of good character, competence, and reliability, and showing proof of financial ability to promptly pay the wages of employees and advances made by construction property owners, owners or property managers of property where janitorial services are or were to be performed, growers or producers of agricultural goods or owners or lessees of land intended for the production of timber in the form of a corporate surety bond or deposit with the commissioner.

Conclusion

In summary, it is not recommended to hire employees as independent contractors to save money on taxes in Oregon. Misclassifying employees as independent contractors can result in legal and financial consequences. To be classified as an independent contractor in Oregon, the contractor must meet certain requirements, including being engaged in an independently established business, being free from direction and control over the means and manner of providing services to others, and having the appropriate licenses and certificates required to provide services. Labor contractors in Oregon are required to obtain a license and meet certain requirements.

Source(s):
Jurisdiction

Oregon