An independent contractor is a self-employed person or business that provides services on a project-by-project basis to customers or businesses. An independent contractor, unlike an employee, is not eligible for the hiring company’s benefits, taxes, and other types of payment. As an alternative, the contractor is in charge of covering all of their own taxes, insurance, and other business costs.
The state of Utah in Utah acknowledges the value of independent contractors to the economy. As a result, the state offers several resources and assistance to people and organizations that seek to become independent contractors. However, it’s crucial to comprehend Utah’s licensing and registration regulations before beginning a contracting business.
In Utah, obtaining a handyman license is a simple procedure. To conduct business legally, the state mandates that every handyman obtain a contractor’s license. The Utah Division of Occupational and Professional Licensing (DOPL) website contains an application form that must be completed in order to get the license. The license is good for two years, and the application price is $210. Additionally, handymen need to clear a background investigation and show proof of insurance.
A distinctive name for the business must then be registered with the Utah Division of Corporations and Commercial Code in order to register a sole proprietorship in Utah. The registration process can be finished online, and the charge is $22. The proprietor can then apply to the IRS for an EIN (Employee Identification Number) once the business has been registered. A special identification number called the EIN is necessary for tax filing.
A freelance writer who provides writing services to clients on a project-by-project basis is an illustration of a sole proprietorship firm. The writer is in charge of customer acquisition, contract negotiations, and independent project completion. The company is not incorporated, and the proprietor is completely liable for any costs associated with running the company, such as taxes and insurance.
A sole proprietor is a person who owns and manages a company on their own. It’s the most basic type of business ownership, and small enterprises, freelancers, and independent contractors frequently use it. Taxes, insurance, and other costs for the business are entirely the sole proprietor’s responsibility. To aid them in their task, they can also engage staff or subcontractors.
In conclusion, obtaining the required permits, registrations, and insurance coverage is necessary in order to work as an independent contractor in Utah. A contractor’s license is required for handymen, and sole proprietors must register their business name and receive an EIN. Freelancers who work as graphic designers, consultants, and other sole owners are examples of sole proprietorship firms. Building a profitable and long-lasting contracting firm requires an understanding of Utah’s laws and regulations governing independent contractors.