The distinction you seem to be making is whether or not you have a business license. If you have a business license, even as a sole proprietor, (meaning you're the only employee as well as owner) you are a business.No, the federal government does not write up contracts with people that don't have a valid business license, generally. It would be pretty risky to attempt such a venture.Yes, some people get contracts with the government directly. One example I can give you is at the department of revenue in my state. They have a cafeteria section which is subcontracted out to a lady who runs it. Essentially, she has the contract to prthe employees with snack food and drinks (800 employees in the one building) and in return she rents the space from DOR.