Contractors and Global Glossary · Workforce

ABC test: a state classification test that presumes employment unless the hiring entity proves the worker is free from control, works outside the usual course of its business, and is customarily engaged in an independent trade (Worker Classification).
Aggregator (global payroll): a provider that collects payroll inputs centrally, sends them to in-country partners to calculate and file, and returns normalized gross-to-net results (International Payroll).
B-notice: the notice a payer sends a payee listed on an IRS CP2100 or CP2100A for a name and TIN mismatch, within 15 business days, before backup withholding begins (Contractors & 1099s).
Backup withholding: federal income tax withheld at 24% from reportable payments to a payee without a correct, certified TIN, reported on Form 945 (Contractors & 1099s).
Combined Federal/State Filing (CF/SF): the IRS program that forwards information returns, including Form 1099-NEC, to participating states (Contractors & 1099s).
Contractor of record (COR): a provider that contracts with and pays an independent contractor on a client's behalf and takes on classification review (Employer of Record & Global Employment).
CP2100 and CP2100A: IRS notices listing a payer's information returns with missing or mismatched name and TIN combinations, CP2100 for 50 or more and CP2100A for fewer (Contractors & 1099s).
Economic reality test: the FLSA test of whether a worker is economically dependent on a business, applied through six factors in the 2024 rule and subject to a 2026 proposal (Worker Classification).
Employer of record (EOR): a provider that is the legal employer of a worker in a country where the client has no entity, while the client directs the work (Employer of Record & Global Employment).
Form 1099-NEC: the information return for nonemployee compensation, at $2,000 or more for 2026, due to recipients and the IRS by January 31 (Contractors & 1099s).
Form SS-8: the form a business or worker files to ask the IRS to determine a worker's status for federal employment taxes (Worker Classification).
Form W-9: the form on which a US payee certifies its name, TIN and backup withholding status to a payer (Contractors & 1099s).
Full Payment Submission (FPS): the UK Real Time Information report of each payment to employees, sent to HMRC on or before payday (International Payroll).
G2N report: a gross-to-net payroll result per worker per country, the unit a global payroll employer receives, reconciles and books (International Payroll).
IRIS: the IRS Information Returns Intake System, the only e-file system for information returns once FIRE closes after November 19, 2026 (Contractors & 1099s).
Permanent establishment (PE): a company's taxable presence in a country under a tax treaty, through a fixed place of business or a dependent agent who concludes contracts, which an EOR doesn't remove (Employer of Record & Global Employment).
Section 3509 rates: the reduced federal employment tax rates (1.5% of wages and 20% of employee FICA, doubled without information returns) for an employer that misclassified an employee (Worker Classification).
Section 530 relief: protection from federal employment tax assessments for a business that consistently treated workers as contractors with a reasonable basis (Worker Classification).
TIN Matching: the IRS service that lets payers check a payee's name and TIN combination before filing information returns (Contractors & 1099s).
Voluntary Classification Settlement Program (VCSP): the IRS program for prospectively reclassifying workers as employees for 10% of one year's section 3509 liability, filed on Form 8952 (Worker Classification).