The best contractor management software in 2024

More than ever, businesses are turning to contractors to help reduce costs and jumpstart growth while staying flexible. But juggling freelancers in multiple locations can get complicated quickly. That’s why it’s crucial to have contractor management software that can easily onboard, manage, and pay your independent workers, no matter where they call home.

We’ve put together a handy guide to compare the best contractor management solutions on the market to help you make the right choice for your growing business.

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FAQs

When figuring out if someone is an employee or a contractor, the IRS looks at a few key things. If you direct how and when work is done, they’re likely employees. If they have freedom in their methods and have other clients, they’re probably contractors. Also, consider payment: employees get regular wages and you cover their expenses, whereas contractors bill for projects and handle their own costs. Misclassifying employees as contractors can have serious penalties, so it’s important to understand the difference. Check out this IRS guide for more information.

Full-time employees will receive a W-2 at the end of the year, and contract workers will receive a 1099-NEC to show them how much they earned. As an employer, it’s your responsibility to send these forms to both employees and contractors before January 31st each year for the previous tax year. The forms must also be submitted to the IRS. Contract workers are treated differently than full-time employees and will not have taxes withheld from their paychecks each period. They are responsible for making quarterly estimated tax payments to the IRS based on their expected earnings.

Independent contractor management software allows you to hire and pay freelance workers as easily as full-time employees without having to manage additional platforms and payment gateways. 

Freelance workers can self-onboard, add and e-sign important documents like contracts, W-9 forms, and bank account information, and even track hours that sync directly to payroll. You can run payroll for 1099 employees at the end of each month, or whenever a project is completed. At the end of the year, your payroll provider should both calculate and file 1099s, as well as mail them to any contractors you paid throughout the year.  

Paying international contractors can be both expensive and time-consuming. International money transfers can be done through platforms like PayPal and Payoneer, but the fees are often very high. More payroll providers are starting to offer international contractor payments, including Gusto, Remote, and Deel. With these platforms, you can pay your international contractors as easily as your team back home.

Prices start at just $55/month

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