An employee's business and travel expenses are generally paid by an employer. This shows that the employee is subject to regulation and control. Independent contractors pay their own expenses. Tools and materials. An employee is normally furnished significant tools, materials, and other equipment by an employer.
Independent contractors provide their own tools.
Profit or loss. Employees receive wages or salary whether or not the business makes a profit or loss. An independent contractor can make a profit or suffer a loss depending on income and expenses. Works for more than one person or firm. An independent contractor provides his or her services to several persons or firms at the same time.