Contractor registration - nine-factor test

What are the nine requirements to be an independent contractor?

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An individual who performs public- or private-sector commercial or residential building construction or improvement services in Minnesota  is an independent contractor only if he or she is registered (or exempt) and meets all of the following requirements:

1. maintains a separate business with the individual's own office, equipment, 
   materials, and other facilities;

2. holds or has applied for a federal employer identification number or has filed business or self-employment income tax returns with the federal Internal Revenue Service if the individual has performed services in the previous year;

3. is operating under contract to perform the specific services for the person 
   for specific amounts of money and under which the individual controls the means of performing the services;

4. is incurring the main expenses related to the services that the individual is performing for the person under the contract;

5. is responsible for the satisfactory completion of the services that the individual has contracted to perform for the person and is liable for a failure to complete the services;

6. receives compensation from the person for the services performed under the contract on a commission or per-job or competitive bid basis and not on any other basis;

7. may realize a profit or suffer a loss under the contract to perform services for the person;

8. has continuing or recurring business liabilities or obligations; and

9. the success or failure of the individual's business depends on the relationship of business receipts to expenditures.

Questions?

Contact us at 651-284-5074 or dli.register@state.mn.us.