Home-Based Jobs Key Terms

Some key terms for home based jobs and home based workers

By J. Stoltzfus, writer/programmer LOCAL CITIZEN

More and more Americans are finding out that home based jobs in their field are out there: whether it's editing, writing, transcribing, communicating, processing forms, filling out surveys, or even things like real estate and education. So much business gets done online every day that home based jobs in many industries are quickly becoming a reality, if not a norm. Businesses that might be looking at this option should find out about some basic terminology that applies to nearly any home based job.

Telecommuting

Although this term may sound fancy, what it really means is that a worker does a job from home, thus skipping the physical transit and "commuting" through advanced modern communications (phone or Internet).
Try: Find out more about telecommuting at Essortment: "Information and Advice You Want to Know."

Independent contractor

An independent contractor or IC is someone who is hired not as an hourly employee but as a contract worker to do a specific job or task. Those who work at home are most often in this category, although many are "sole proprietors" (those who have their own business and treat companies not as employers but as clients).
Try: This helpful IRS page on defining an independent contractor will show how home based workers most generally fall into the IC category because of the inherent freedoms and control over work space and conditions that goes along with working from home.

1099

A 1099 type of contract is one undertaken by an independent contractor, where for annual taxation, the worker will get a 1099 form, listing the total compensation, and pay his own taxes, instead of having taxes withheld by an employer, which is often what workers may be used to.
Try: Find out more about 1099 contracting at Chancellor and Chancellor online.

Pyramid scheme

A pyramid scheme often targets those who would like to legitimately work from home. The pyramid scheme encourages the first set of applicants to recruit others, while enriching those at the top of the project, hence the pyramid metaphor.
Try: Get a great definition and visuals on pyramid schemes from this page at the U.S. Securities and Exchange Commission.

Direct marketing and multi level marketing

Another somewhat related type of "job" abounding online is called direct marketing or multi level marketing. Some also call these "pay to play" situations if the original "job offer" involved sending money or buying products. An MLM can be seen as legitimate according to its setup, but many steer clear of these kinds of enterprises.
Try: Find out more about direct marketing and multi level marketing at this page from Small Business Notes.

Startup

Many smaller companies known as "startups" because of recent formation will often hire employees to work from home until the company gets large enough to acquire office space.
Try: Find out more about what a startup is at the Paul F. Walsh site. Also see Technorati for more information.