Do you own a sole proprietorship business? Are you the employee and the boss? Well, paystubs are for everyone whether you’re a small or large business owner. Similarly, it follows you even if you’re self-employed (independent contractor).
Though the way for addressing paystubs differs a lot for employees as well as self-employed individuals, the earning statement is crucial for both. In this blog, we’ll see the basics as well as the importance of independent contractor paystubs & more. Let’s begin.
Paystub for Independent Contractor – The Basics
In simple words, a paystub for an independent contractor is the record of income they’re supposed to maintain for filing tax returns to the IRS. As you know, pay stubs or paychecks disclose detailed breakdowns of the earnings, benefits, etc. Thus, self-employed individuals aka independent contractors must maintain their earning statements to waving tax season like a breeze.
Nowadays, it is quite feasible to create independent contractors’ pay stubs free using automated tools.
This means that you don’t need to outsource paystubs just because you don’t find time to make one. It barely takes a few minutes to get you sorted. The key is to keep up with paystubs monthly or quarterly as suitable to save time when tax season arrives.
Unlike employers, independent contractors create paystubs for themselves. They don’t have to produce them for anyone else but for their record-keeping & filing taxes. Here is more clarifying how independent contractor paystub and employee paystub differ.
Independent Contractor Paystub vs. Paystub for Employees
If you think independent contractor paystub and paystub for employees are the same things then it’s time to reconsider. Here is a brief classification you should see.
➩ When is the paystub made? The independent contractor needs to create a paystub whenever required while employees receive a copy of their paycheck on payday from the employer
➩ How frequently? Employees may receive paychecks for each pay period while independent contractors may skip for the term they don’t have any income
➩ Taxes and Deductions: Independent contractors don’t have any kind of tax/deductions from their paychecks while employees have deductions clarified & listed.
➩ Bonus/Benefits: Independent contractors don’t receive any benefits or bonuses while employees have paychecks with breakdowns for gross pay.
➩ Independent contractors working for a company can receive their income statement from the respective firm.
➩ Lastly, independent contractors can club earnings from multiple companies for the same term in one paystub while employees cannot create a paystub by themselves. They have to wait for the employer to provide them with a pay stub.
Why would an independent contractor need a paystub generator?
If you think you can escape paying taxes being an independent contractor then you’re making a big mistake. Paystub is a quintessential document that helps you in many ways besides filing taxes.
First things first, you should manage your income & track your progress with pay stubs. Secondly, an independent contractor should also produce an earnings statement for getting a new car or a home on rent.
Similarly, they’ll need it for credit card facility or requesting a loan from a financer. Generally, you’ll require a few recent paystubs for getting loans passed or easy rent approvals.
Some states mandate independent contractors for producing paystubs while others don’t require them.
As a business, you should check whether your state law wants you to create a pay stub or not. However, it is useful for personal records of income too. So, it is not a bad idea at all if you’re willing to make paychecks for self-records of tracking income too.
How to create pay stubs for independent contractors?
Are you an independent contractor? Do you want a reliable and affordable independent contractor paystub generator by your side? We’re listening!
Here is the simplest way to create pay stubs for independent contractors:
➩ Find a reliable, affordable & accurate paystub generator like ours
➩ Use the automated paystub calculator tool for an independent contractor. Don’t forget to select the type of individual you’re creating a paystub for. For instance, you have to select ‘contractor’ with the tool instead of an employee. That’s it. Enter the details as required
➩ Add Email & make payment
➩ Your paystub is ready for download & use straightaway!
Using Paystub Templates
Your paystubs should always be in the standard format but they’re not supposed to be boring. We’ve got some eye-catchy & professional paystub templates for all. This wide range of paycheck templates will help you customize paystubs with unique designs. Though this is an optional step, it’ll make for an impressive appeal if you choose templates. So, it’s up to you.
What else you can do with our paystub generator?
Besides paychecks (paystubs or check stubs), you can also create tax documents like the 1099 Independent Contractor Form (aka 1099-MISC). This simply means that all your earnings statement as well as tax statement documents can be availed from one place only. Isn’t it what every independent contractor wishes for?!
Need an Independent Contractor Paystub? Let’s get started!
We can help you create professional & 100% accurate paystubs in a few minutes only. Whether you’re willing to make a YTD paystub for an independent contractor or a current date paystub, our automated calculator is here. As you’ve seen, it is a few-step process only. Check out the menu now & select the paystub or 1099 MISC Form whichever you need at the moment.
