Should Independent Contractors Receive a Pay Stub?

Should Independent Contractors Receive a Pay Stub?
Kristen Larson
By Kristen Larson
December 16, 2023
4 min read

Having a valuable skill set opens up several contractual business opportunities in organizations without being permanently employed by them. Self-employment has many perks, but it's not without disadvantages, like not getting pay stubs from employers.

This is because contractors work under agreements and are not necessarily full-time staff of an organization. Where employers might generate pay stubs for their staff, they would draw the line with contractors. 

Instead, they would file a 1099-MISC form and send it to the IRS and contractor, informing them of contractual payments. Still, many people ask - should independent contractors receive a pay stub? This article will define a 1099 pay stub and how to create a pay stub for 1099 contractors

What Is an Independent Contractor Pay Stub?

Independent contractors' pay stub indicates the payment contractors receive from an organization. It's a document they can use as proof of income and for tax purposes. Contractors can make pay stubs at home using third-party pay stub generator websites. 

The contractor must organize their pay stubs to avoid getting in trouble with the IRS. Any error on the pay stub could be interpreted as fraudulent by the IRS and grounds for legal prosecution. That's why contractors should request a 1099-MISC form from the organization they worked with to ensure they have the correct payment details. 

The good thing about using an independent contractor pay stub generator website with a contractor pay stub template is that it minimizes any chances of error.

Should Independent Contractors Receive a Pay Stub from the Employer?

Yes, it is proper for employers to send contractors a pay stub. However, employers provide a pay stub independent contractor service by filing a 1099-MISC form, indicating only the total income amount they received during the year. They do not include any tax deductions because they only give full-time staff a comprehensive pay stub.

Therefore, is it better for employers to generate contractors' pay stubs? Yes, it would take the edge off and be easier to avoid, but providing pay stubs is best for contractors. However, to compile their pay stubs to have first-hand knowledge of its content. 

Can an Independent Contractor Create a Pay Stub?

Yes, Independent contractors can get pay stubs online. A contractor's pay stub is usually less complex than an employee's pay stub. It does not feature the majority of benefits employers give their staff, from health insurance to Medicare, tax deductions, salary raises, bonuses, etc.  

An independent contractor's pay stub features gross income, company details, personal information, pay rate, number of working hours, and current total. Record-keeping simplifies expense tracking and is also useful when taking out loans, renting an apartment, or purchasing a new vehicle.

How to Create Self-employed or Independent Contractor Check Stubs

There's nothing farfetched about the process if you need to create a check stub for yourself. The pay stub generator website has already done the bulk of the work and has a contractor pay stub template anyone can use to generate pay stubs faster. So first, choose a pay stub generator such as Real Check Stubs, then use the following steps to generate your pay stub.

Step 1: Choose a Template 

Select any template of your choice, and ensure the headings are visible and feature all the information you need to fill out. 

Step 2: Enter Your Information

Enter the company details and your information, including hourly rates, gross income, pay rate, etc. ensure the information is correct and consult the 1099-MISC for an accurate result. 

Step 3: Preview the Document 

At this stage, go through the document and proofread for errors. Feel free to go back to the previous page and correct any errors before submitting the document. 

Step 4: Download the Document 

Download the document as a PDF file and save it until needed. You can always visit the site to download the pay stub again. They will keep a record of your pay stub. 

Frequently Asked Questions (FAQs)

Who is self-employed or an independent contractor?

A self-employed individual or contractor works under a contract agreement with different organizations, rendering a particular skilled service. They usually dictate their hours and have deadlines to provide the finished work. 

Most contractors can work for other companies or be exclusive if a company retains them for a particular job.

For clarity, an employee of an organization can pass as self-employed if they choose to use the other organization's information to generate their pay stub. It depends on what they feel is best for them.

What is a 1099 pay stub?

A 1099 pay stub is a document contractors generate to show proof of income and for tax purposes. When employers generate a W-2 form for their employees, detailing annual pay, tax withholding, and health insurance, they generate a 1099-MISC form for contractors, indicating their gross income. 

The 1099-MISC gives contractors a concrete idea of how much they've earned in a particular year so they can report to the IRS when doing their taxes. Also, they use it to generate an accurate pay stub. Employers also send it to the IRS to confirm their contract with a company for tax purposes. 

What to do if the employer does not provide a pay stub

If your employer still needs to send over your 1099-MISC form, send them a professionally written email reminding them to send the document. It is likely a mix-up; they will send it when they get your email. However, you must pay your tax if they do not send the form. So use the information available to do so.

As a self-employed individual, you should keep tabs on your payments for tax purposes. Although organizing accounting for businesses can be tedious work, it's still necessary if you want to avoid paying tax penalties. 

Why is it essential to have a pay stub for the self-employed?

Pay stubs are important documents to have handy for proof of income. Usually, landlords or lenders ask for proof of employment or income to ensure you will pay back the loan or afford the rent. So, generate self-employed pay stubs in situations like this.

Final Words on Independent Contractor Pay Stub

Having pay stubs can bring much clarity about your finances and remuneration.  Also, to pay your taxes and know your income status, you need copies of your pay stub, even if you are an independent contractor

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