Hiring independent contractors, consultants or freelancers instead of employees can save you time, money and paperwork. But if you treat a contractor as an employee, the IRS can (and will) hit you hard with penalties.

Use the "Contract With Independent Contractor" to not only come to an agreement with your contractor, but to help justify your working relationship when the IRS comes knocking on your door. The contract will list the details of the job to be performed, while making clear that your contractor will receive no fringe benefits, can work for other clients, will pay their own taxes and so on.

Important to Know:

• No contract automatically protects you from the IRS -- if you treat your contractor as an employee, so will the IRS.
• Use contractors who provide their own tools and supplies to get the job done.

Operating system: Windows- and Macintosh-compatible. The computer you use to purchase an eForm must be the same computer you will download it to. (For example, don't purchase the eForm using your computer at work if you intend to download it later on to your home computer; instead, wait until you're on the computer you intend to download the eForm to and then make your purchase. After you've downloaded the file, you will be able to "transfer" it to another computer by copying it to external media or by email.) In addition, you will not be able to download this file if:

• cookies are disabled on your computer, or
• a firewall prevents you from downloading files from the Internet.

Software: Before you can use an eForm, additional software must be installed:
To expand the ZIP archive you download after making your purchase, you'll need:

• A decompression utility such as the following, both of which can be downloaded for free:

• 7-Zip (http://www.7-zip.org) (for Windows users).
• StuffIt Expander (http://my.smithmicro.com/mac/stuffit/expander.html) (for Macintosh). Please note: Many recently manufactured Macs have a native capability to decompress zip files. See your computer's user manual for verification of this and instructions for access.

To open, fill out and print an eForm, you need a word processor that "reads" RTF (rich text format) files:

• Windows XP & Vista both come with WordPad, an RTF-compatible word processor.
• Macintosh OS X comes with TextEdit, an RTF-compatible word processor; non-OS X users need Word 5.0 or greater, WordPerfect 2.1 or greater, or another RTF-compatible word processor.