Shoppers as Independent Contractors
For tax purposes, very few
mystery shopping companies hire shopping employees. Instead, they use
shoppers as independent contractors, which mean they are people who are
in business for themselves, not others.
are people whom are in business for them selves; they earn their livelihoods
from their own independent businesses instead of depending upon an employer
to earn a living"
In simplest of terms, it means
you are responsible for your own taxes, not the mystery shopping company
that gave you the assignment. You will be paid a set amount and the company
will not be taking out any state or federal taxes from your check.
This means, that as an independent
contractor, you must pay estimated taxes directly to the IRS quarterly.
One of the good benefits about
working as an independent contractor is you can deduct
your mystery shopping expenses for tax purposes. However, you do not
have any job security but with that in mind, it is very rare for a mystery
shopper to be hired as an employee and not an independent contractor.