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Business Taxes Law Guide—Revision 2024
Sales and Use Tax Annotations
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120.0000 Automatic Data Processing Services and Equipment—Regulation 1502
Annotation 120.0563.950
(a) In General
120.0563.950 Special Employees vs. Independent Contractors. In determining whether a taxpayer is making taxable sales under Regulation 1502(f)(2) or is merely furnishing "special employees" to its customers, the distinction between special employees and independent contractors must be drawn. Of the factors entering into this distinction, the primary one is whether the person for which the work is being done has the legal right to control the manner and means of accomplishing the results desired. Other factors to be considered are:
(1) Whether the one performing the services is engaged in a distinct
occupation or business,
(2) Whether in the locality, the work is usually done under the direction of the principal or by a specialist without supervision; the skill required in the particular occupation,
(3) Whether the principal or the workman supplies the instruments, tools and place of work,
(4) The length of time for which the services are to be performed,
(5) The method of payment (time spent or by the job),
(6) Whether the work is part of the regular business of the principal, and
(7) Whether the parties believe they are creating the relationship of employer-employee. 11/22/77.