Following is some general information and the most common, pro-active steps Budget Managers and Department Heads can take to help ensure payments for Consultants and Independent Contractors are processed in expeditiously.
Determine the Service Providers Proper Classification
Before you engage a service provider, be absolutely sure of their classification. If you are unsure if the service provider should be classified as an 'employee' of the College or as an 'independent consultant', use the following two documents to help guide you toward the proper classification.
- The Chancellor and Dean and the CFO are the only officers authorized to enter into Agreements on behalf of the College.
- Contracts valued at $50,000 or more require approval by the Board of Directors.
- All Agreements must be approved as to form by General Counsel before they are signed by the CFO.
Processing Independent Contractor / Consultant Payments:
- Ensure sufficient budgeted funds are available.
- Secure a fully executed Agreement before the work commences. Refer to the Financial Policies and Procedure Manual, Exhibit X, for a sample Agreement.
- Establish a purchase order in advance of the service date if the cost of service is over $4,999.99. Attach a copy of the fully executed Agreement to help expedite the purchase order.
- Do not pay independent contractors/consultants from your personal funds; you will not be reimbursed by the College. Most contractors and consultants must receive a 1099-MISC form and this form cannot be sent if the payment to the contractor / consultant is made by an individual.
- Secure a completed IRS W-9 form to the Agreement.