Independent Contractor Process Overview

There are many reasons for hiring outside vendors to assist us in achieving our goals. These include things like translating, editing, consulting, training and speaking engagements. Due to IRS regulations, Boise State is required to have a documented process for evaluating whether we pay these vendors as employees or Independent Contractors. Failure to follow our stated process can result in fines from both our auditor and the IRS.

The following steps will assist you in hiring and paying for outside help – ensuring we mitigate risk for ourselves and our suppliers and providing them with payment in the most timely fashion.

1. Campus completes IRS Classification Request

This Smartsheet form will ask you a series of questions about the work being done, the timelines and the amount being paid. Answer these questions to the best of your ability. Don’t worry if you are not sure of the exact answer, just be as complete as possible. P2P will be in touch with you if anything is not clear.

2. Accounts Payable performs a pre-check and advises campus within three business days whether to proceed with an Independent Contractor (IC) or employee hire

Based on the Scope of Work, dates of work and amount being paid, we can be 99% sure that an individual will qualify as either an employee or an Independent Contractor. Workers classified as employees at this point will remain in that classification. Workers pre-approved as Independent Contractors are subject to a final review after they complete PaymentWorks.

3. Campus invites new IC vendors to complete PaymentWorks

If your vendor has not worked for Boise State since January 2020, they will need to register in PaymentWorks. This secure application collects tax and payment information. The tax information is required. If your vendor is nervous about providing banking information, they can request payment via a check. If you are unfamiliar with PaymentWorks, use the Inviting Vendors to PaymentWorks job aid.

4. Campus provides Accounts Payable with the vendor number and a draft of the Contract for Services (CFS) or Local Engagement Agreement (LEA)

Tax information collected in PaymentWorks is used to complete the IRS Classification. Once your vendor has completed PaymentWorks, you will be provided a Vendor Number. This number needs to be added to the Smartsheet so P2P can finalize the classification. At this point, you will also need to attach a draft of your Contract for Services or Local Engagement Agreement. P2P will review your draft and assist you with any questions regarding how to write the Scope of Work, Payment Information, etc. This will save you time later and ensure your final contract and payment requisition are processed quickly.

5. P2P completes classification and provides the campus user with information on processing the final payment

Within five business days of providing the information in Step 4, the campus user should have a final draft of their agreement ready for processing and information on how to submit a Payment Requisition once the service is completed.

6. Campus user gathers signatures for LEA or CFS

The State of Idaho provides all employees with access to Adobe Sign. This makes it really easy to collect all of your signatures in one email. Boise State requests that vendors sign first so you will want to set your supplier up as the first signer. Be sure you know who in your area is an authorized signer and set the second signer up accordingly.

7. Complete a Purchase Requisition as soon as the service is completed

Use the BPA provided by P2P in Step 5 and the Submitting Independent Contractor Requisitions job aid. P2P automatically sets Independent Contractor payments to pay “immediately.” Electronic payments are processed Tuesday and Thursday mornings; check payments are processed on Thursday mornings.