Before (s)he Starts Work
Sign a Contract – A contract breaks down expectations on both parties, clearly states payments and milestones, and legally protects both parties should the relationship hit a snag. Your contractor may send you a contract. If she doesn’t, you should send her one. Even if you’re in a hurry to get started, a service like DocuSign can make this process very quick. Or if you’ve hired your freelancer through a marketplace like oDesk or eLance, rest assured that your contractor has already signed a contract with that service. Of course, even with those services, you may desire extra legal protection if your project is sensitive or out of the ordinary in some way.
Fill out Form W-9 – If you pay your contractor more than $600 in the calendar year, you are required to send her a form 1099-MISC during tax time. (More about this later!)
Download form W-9 from the IRS website, have your contractor fill it out, and keep it on file for tax time.
After the Work is complete
Give Feedback Where Appropriate – Your contractor is constantly honing her skills, so be sure to give her honest feedback about her work and the process of working with her. Professionals appreciate honest feedback. If the feedback is at all negative, of course, use your discretion and couch it in polite terms.
Give a Testimonial – If you loved your contractor’s work, offer to give her a testimonial. She’ll be able to use this in your marketing materials and on her website so find more clients and stay in business for a long time to come.
Give a Referral – Even better than a testimonial is a referral. If a contractor did a great job for you, she’ll likely do a great job for your friends. Don’t keep her to yourself!
At Tax Time
Send Form 1099-MISC – As mentioned above, if you paid your contractor more than $600 within the calendar year, you must send her a form 1099-MISC at the end of the year. If you kept her form W-9 on file, you’ll have everything you need to send this document. Be sure to get it to her by the deadline, January 31st. Be sure to be timely. Failure to do so can lead to fines and penalties.