Subcontracting

Keep in touch with other freelancers so that you have someone to call upon when your workload is too much for you to handle. Their skills should complement your own. Subcontracting allows you to run a nimble and flexible business. You can take on projects outside your area of expertise, and take on larger projects without additional overhead costs.

Trusted subcontractors are extremely valuable. If one of them doesn't come through, you end up doing the work yourself or scrambling to find someone else. The ones you can count on become assets to your business. As your business grows, you may end up hiring your best freelancers as full-time employees.

Briefly, a subcontractor works on her own equipment on her own schedule. You pay her only for work completed. At the end of the tax year, you report the amount paid to each subcontractor on a 1099-MISC form and they pay their own taxes. An employee works at your direction, usually on your equipment and on your premises. You pay him regularly and withhold taxes from his paycheck. The IRS has more details, and you must know and comply with their definitions.

Find freelancers at organizations for creatives, through professional networks online and off, and by placing ads for specific skills. Check their portfolios and references.

When subcontracting, put the parameters of the project in writing. Get an estimate and agree upon a schedule and due dates. Make sure they are not intending to retain copyrights. What you want is "work for hire." The better you communicate, the less likely you will have an expensive misunderstanding. Your freelancers should be every bit as professional as you are. But the buck stops with you. Check their work carefully before forwarding it to clients.

Sometimes you will not want your clients to know you are subcontracting, but never be dishonest if asked directly. Sometimes you will want to encourage your clients and freelancers to develop a working relationship. That opens the door for your client to go directly to the freelancer and cut you out of the picture. To avoid losing a client, make sure that your management and expertise add value to every project. In some cases, however, removing yourself can be best for all parties.