Tom, I'll take a stab at it. Others here may have something better.
SUB-APPRAISER INDEPENDENT CONTRACTOR AGREEMENT
This agreement made and entered into this _______ day of_______, 200__ by and between Appraiser Name, doing business as Appraiser Business Name and __________________________ , an independent contractor. Appraiser Name and Appraiser Business Name shall be known as the appraiser and _____________________ shall be known as the sub-appraiser.
The appraiser is contracting with the sub-appraiser for work to be done on real estate appraisals. Appraiser may set forth the form, work method, and all other requirements for appraisals. The sub-appraiser shall be paid a percentage of the appraisal fee charged by the appraiser, to vary based on the appraiser's and sub-appraiser's agreement of the sub-appraiser's skill level, except that the sub-appraiser's percentage for residential work shall not be less than 25 % of the gross fee, and will not exceed 60 % of the gross fee until such time as the sub-appraiser is state certified to do appraisal work. Payments shall be made upon completion of residential work, except that when the percentage is increased beyond thirty-nine (39 % ), the sub-appraiser agrees to receive payment when the appraiser is paid by the customer/client. It will be the sub-appraiser's responsibility to keep the appraiser informed of address if this contract terminates at any time before final payment has been made for appraisals done, and the appraiser's mailing of payment to the last known address of the sub-appraiser shall constitute good faith effort to make any payment due.
Sub-appraiser may also do commercial work, other appraisal related work. The minimum fee percentage and payment time frame in the paragraph above will not be applicable to work covered in this paragraph or for partial work on any appraisal job. Any such commercial work, related appraisal work, or partial work shall be paid on a per job basis, based on an amount and time frame agreed to prior to beginning the work.
The sub-appraiser shall furnish supplies and equipment, as needed, to do the appraisal work. The sub-appraiser shall determine his or her own hours of work.
The sub-appraiser is a person with some experience, knowledge, or education in real estate and expects to increase this knowledge as a result of doing the contracted work; sub-appraiser warrants that they will not attempt to do work beyond their level of competence and will request assistance, as needed. The sub-appraiser agrees to follow all provisions of the Uniform Standards of Professional Appraisal Practice (USPAP), including, but not limited to, the confidentiality and competence requirements.
This agreement may be terminated by either party at any time without prior notice or reason for termination. In the event that sub-appraiser terminates the contract, without notice, before completion of a specific job being done, sub-appraiser agrees that no fee will be applicable to that specific job.
The sub-appraiser is an independent contractor and shall not be considered an employee for purposes of income tax withholding or payment of social security. Sub-appraiser shall be responsible for reporting any income received from appraisals to the IRS or other appropriate taxing authorities and agrees to pay his/her own taxes. Appraiser shall not furnish workers compensation insurance because sub-appraiser is not an employee.
Sub-appraiser shall be responsible for any expenses incurred during making of appraisals including but not limited to automobile expense. Sub-appraiser shall at all times maintain valid liability insurance on any automobile used by sub-appraiser for appraisal related work.
This agreement is executed in duplicate, becomes effective on the date signed, supersedes any previous agreements, and shall remain in effect until terminated by either party. Termination notice may be verbal or written.
PLEASE KEEP IN MIND: I am not an attorney. I lifted this off of another appraiser many years ago and parts of it may be a bit out of date. Good luck.
Why not ask one of the local brokers what they use for their sales people? These have already been formulated for the real estate profession. The minor changes needed should be sufficient for your needs.
The agreement as written above will land you in a huge tub of hot water and if you are using it, can subject you to an IRS audit. It clearly sets out that the "appraiser" is a supervisor as the most major fault among others. I join Mike in the entreatry not to practice law on the Internet. I will relate only what I know and have observed.
You can only use an independent contractor if you give up total and that is total control. You can't tell them what form to use or any way supervise them.
You need urgently to go to this website for an over view.
To use a person as an independent contractor, you need good legal advice not some drivel off the Internet.
Secondly, you cannot use the same agreement as a real estate agent. In most cases there are state exemptions for real estate agents. They have separate standing from the IRS.
You will quickly find if you are fee splitting, you need to pay taxes on that person. If you aren't, you in in serious trouble from both the Feds and the State where you live. You are subject to uneployment taxes, workman's comp and a host of other taxes.
My suggestion, which may very well add to the drivel clutter is to set up a deal with a temporary help agency and pay them to pay the person with whom you want to fee split. Otherwise, buy Quick Books and Quick Books payroll, apply with the state and feds and start paying taxes.
Jeepers, if you are paying anyone out of your receipts run it by your lawyer or CPA.
If that were true every insurance company, every brokerage, and every realtor in the United States would be out of business.
I have worked for three insurance companies and a close friend currently works for a brokerage firm. All of them require the use fo certain forms and always work under a supervisor. As usual, people in the appraisal business are way behind the times related to normal business practice. The form I posted may have flaws, but it's a start. It is very similar to my agreement with Mutual of Omaha from a few years ago, and yes, I did have supervision.
What the IRS generally looks at is whether the person is required to keep specific hours, whether they use their own equipment, and whether they are responsible for their own expenses. An independent contractor can definitely be supervised.
My CPA says that the agreement is basically okay. He is in good standing with the IRS.
The IRS has a fairly strong incentive to prove that your independent contractor is an employee. There are rumors of local appraisers that "lost it all" because they misinterpreted the rules.
However, consider what happens when your independent contractor hits a pedestrian. If the plaintiff's attorney can show that your independent contractor is in fact an employee, you could be liable for damages, with no applicable insurance.
An attorney friend says that unless your firm is big enough to efficiently handle employee payroll, "leasing" employees from a personnel firm is the safest and most efficient way to go.