Are Virtual Assistants Employees or Independent Contractors?

That’s the topic of a recent article on the USA Tax Aid blog here: Are Virtual Assistants Employees or Independent Contractors?

It reinforces something I’ve been telling folks all along about those team/multi VA businesses: ICs are not legally part of your team/business and they shouldn’t be listed as such on your website.

What they don’t seem to be able to grasp is that there are legal implications in portraying someone as part of your team.

Someone is not part of your team unless they are an actual employee and if you insist on calling them that, you are going to put yourself smack dab on the radar of the IRS.

Which is why the “team/multi VA” term is so idiotic.

If all they are doing is farming out their work and clients to other companies, there is already a (proper) term for that. It’s called subcontracting.

And those people, in order to be considered independent contractors running their own businesses, are not part of their team.

Regardless of your position on subbing out your client work/relationships, the fact is that sub is not legally part of your team. You don’t get to tell them when/where/how and you certainly don’t get to dictate hours and pay. And if you do, then you are going to quickly find yourself owing money and facing a great deal of hassle that could bankrupt your business.

Subcontractors do not need to be and shouldn’t be on your website.

It’s not about depriving them of “credit.” If they take on a subcontracting job, they don’t get credit. They are doing the work on behalf of your company. It’s your company whose name goes on the work. That’s just how subcontracting works.

You don’t have to like it. But if you want to argue about it, take it up with your tax authority. I think you’ll be set straight real quick. ;)

This is also another reason why you (or any business owner) should NOT submit resumes and references:  because you then give the wrong appearance that you are an employee applying for a job/position.

That’s NOT how business owners market.

Not talking about this and getting the story straight is as stupid, irresponsible and unethical as telling people they don’t have to pay their taxes.

3 Responses

  1. Cathey Kuhn says:


    Thanks again for your kick-ass advice! This topic came up in a recent Quickbooks class I took where the presenter explained how to set up employees vs. ICs and why. There are so many people out there who have a problem understanding the difference. Great topics this week on the blog!

  2. Michelle says:

    Hi Danielle,

    I appreciate and value your information on this topic. Recently, I read a post on one of the networking groups I belong to that asked for a resume. I did not reply, just thought, damn when are they ever going to get that we are not employees!!

    So this is the response from this certain person regarding why she asked for a resume. I did not display her business information.

    “I do not nor am I looking to hire employees; I started a company, ____ which features Independent Contractors, who are also Business Owners. My goal is to be the ‘go-to group’ for all business support services in _____. I promote (her company) and coordinate the work for the consultants. I ask that all consultants submit a resume, at least three professional references who we may contact and a copy of their business license. I do this so I can check to see if the consultants, who want to join our team of Independent Contractors, meet the expectations and level of expertise my clients have come to expect from (her company). I am not willing to jeopardize (her company) business relationships by contracting with someone who would prefer not to apply, so to speak. As a business owner, I would provide the above requested information if necessary, to anyone who asks.”

    I know I should not really even let this get to me, I can always “ignore,” however, this makes no sense to me at all. How about you?


  3. I think she just doesn’t get it (and doesn’t want to). The IRS will set her straight eventually.

    I think it’s important to talk about this topic as an industry so that people can be as well-informed and enlightened as possible and this is good for use as an example.

    At the same time, we have to let the specific cases like this one go or it will just drive us crazy. This person just doesn’t get it (and doesn’t want to get it) and we can’t waste our time and energy on her. So the conversations we have on this topic aren’t for her benefit individually (because let’s face it, she’s ignorant and nothing you can say or do will change that if she’s set in her thinking), but rather for the community at large. Know what I mean?

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