If you have contractors in your home state, it may not be a big deal for you to run your own back-office, particularly if you are already processing payroll and handling taxes, unemployment, Workers’ Compensation, benefits, etc. for your own staff.
But before you can take placements in other states, you’re going to have to do a lot of legwork and homework. Every state has different laws and requirements you will have to follow for the contractors you have placed there. For example, each state has specific tax requirements, so you will have to get registered to pay those taxes and handle any withholding, reporting, reconciliation, etc., that are involved. The regulations are different in each state, so you will also have to invest a lot of time researching upfront.
If you don’t feel that your firm has the time or resources to take on these additional tasks, that doesn’t mean you have to turn down out-of-state contract job orders. You can outsource those placements to a contract staffing back-office that will take on those responsibilities as the W-2 employer of your contractors. For example, FoxHire is already set up to do business in 49 states. If you choose FoxHire as your back-office, you do not sign a contract and are under no obligation to run all your contract placements through us, so you can still run the back-office for placements in your home state.
