Hiring a massage therapist or other independent contractors at a chiropractic clinic is a very complex issue. Generally speaking, it’s hard for you to really prove that an independent contractor is truly independent because most of the time in the clinic you’re going to want to exert some control over them.
If the IRS ever sees that you exert control over that independent contractor, and that independent contractor fails to pay their taxes, you’re going to find the IRS coming after you for that independent contractor’s taxes, penalties, and interest.
So you need to be very careful when you do independent contractor agreements. Is it possible to do an independent contractor agreement with a massage therapist and do it legally? It absolutely is, but you have to make sure that you don’t exert any control over them and you have to make sure you don’t run afoul of the STARK law, the fee-splitting laws, and the anti-kickback laws.
That’s very difficult under most contracts. One way to accomplish this is to do a rental agreement for fair-market value that exceeds one year. In other words, what you charge for the rent cannot be in any way associated with how much massage referrals they are getting from you, or how much volume they do.
The agreement has to be for fair market value, and you really should get the opinion of a realtor before you enter into those agreements. Independent contractor agreements are rampant in the chiropractic profession, but that doesn’t mean they are the best idea from a legal standpoint.
There are simply too many ways that chiropractors may have to defend themselves against independent contractor agreements when there is a much simpler solution. That solution is to hire them! You can do all sorts of deals and percentage deals and things like that as a group practice that you can’t do when hiring an independent contractor.
You don’t run afoul of federal law and don’t have trouble with your taxes and things like that. It really just makes everything a lot simpler.
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