Independent Contractor Service Agreements

Procurement


10.10    Independent Contractor Service Agreements                                  Issued: April 1, 1999
                                                                                                                                                           Revised: April 1, 1999
                                                                                                                                                           Revised: May 14, 1999
      
                                                                                                                                                     Updated: October 15, 2001     



1.    Purpose of Independent Contractor Services Agreement


       The purpose of an Independent Contractor Service Agreement (see Attachment 1) is to clearly
       document the obligations between the University and an individual contractor. The information provided
       on the form also aids the University in making a proper assessment as to whether the individual should
       be treated as an employee or a contractor, based on the appropriate IRS guidelines. This standard
       contract form is only used when each of the following conditions exists.


       a.   The contractor is an individual.
       b.   The contractor will be rendering services to the University.
       c.   The contractor has not been employed by the University or any other component
             of The Texas A&M University System within the past 12 months.
       d.   There are specific terms and conditions which make it prudent to have a contract signed by both
             parties. {Note: This assessment will be made jointly by the requesting department and the
            Purchasing Agent.}

2.    Procedures for when Independent Contractor Services Agreement is Not Required

       When it has been determined that an Independent Contractor Services Agreement is not needed, the
       requesting department must process their request through the following procedures. {Note: Approvals
       must be obtained before work is to be performed.)


      2.1    Initiation


               The requesting department must submit a Purchase Requisition that provides the name and
               social security number of the proposed contractor and an adequate description of services to be
               rendered.



     2.2    Review and Approvals


              The request is subjected to the following review and approval process:












Reviewer/Approver Purpose
Human Resources Office or Payroll Office Verify that contractor was not employed by TAMUS within last 12 months
Purchasing Agent Verify that contractor meets IRS guidelines to be treated as an independent contractor; Verify that bid requirements (if any) have been met.


        2.3    Purchase Orders


                Upon approval of the request, the Purchasing Office will issue a Purchase Order (see
                Administrative Procedure 10.02). Upon receipt of the Purchase Order, the contractor is
                authorized to perform the services.


       2.4    Payment for Services


               Often, an individual contractor does not provide an invoice to the University for
               services rendered. When this occurs, the requesting department should complete an
               Independent Contractor Performance Report (see Attachment 2) and submit it to the Accounts
               Payable Office to initiate a payment to a contractor. {Note: Failure to provide an approved invoice
               or performance report to the Accounts Payable Office will result in the contractor not getting
               paid.}


3.    Procedures for when an Independent Contractor Service Agreement is Required

        When it is determined that an Independent Contractor Service Agreement is needed,
        the requesting department must process their request through the following procedures.
       (Note: Approvals must be obtained before work is to be performed.}

       
3.1   Initiation

              The requesting department must complete the Independent Contractor Services Agreement
              (see Attachment 1), obtain signatures from both the contractor and the applicable budget head,
              and submit it to the Purchasing Office along with a properly completed Purchase Requisition.
              If the requesting department anticipates using the independent contractor for more than one event
             during the fiscal year, they should prepare one contract for the year (if possible) and then submit
             individuals Independent Contract Performance Report forms for payment of each event.

      3.2   Review and Approvals

             The Independent Contractor Services Agreement is subjected to the following review and approval process:
             














Review/Approver

Purpose
Human Resources Office or Payroll Office


Verify that contractor was not employed by TAMUS within last 12 months
Purchasing Agent



Verify that contractor meets IRS guidelines to be treated as an independent contractor
Contract and Compliance Officer









Verify that standard contractor form has not been altered

Verify that form and supporting Independent Contractor Determination form have been properly completed

Verify that all other required signatures have been obtained


                 All contracts will be executed by the properly authorized official, as per the President’s
                 Contracting Delegation (See Administrative Procedure 2.02).


       3.3    Purchase Orders

               The fully executed Independent Contractor Services Agreement is returned to the Purchasing
               Office for processing of a purchase order (see Administrative Procedures 10.02). Upon receipt
               of the fully executed agreement and Purchase Order, the contractor is authorized to perform the
               services.

      3.4    Payment of Services

              Often, an individual contractor does not provide an invoice to the University for services rendered.
              When this occurs, the requesting departments should complete an Independent contractor
              Performance Report (see Attachment 2) and submit it to the Accounts payable Office to initiate a
              payment to a contractor. (Note: Failure to provide an approved invoice or performance report to the
              Accounts payable Office will result in the contractor not getting paid.}


Contact: Purchasing Agent



 

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