By: John P. Napolitano, CFP®, CPA, PFS, MST

The new term often bantered about is something called the “gig” economy.

Unlike jobs, with benefits, retirement accounts and daily supervision, the gig economy is different. It is basically when you accept short term projects from someone who needs work but isn’t willing to add to their payroll and all of the associated costs. You’ve seen this develop for people who are laid off, retire early and may still be needed for a project or two from their prior employer, or a new budding group of solopreneurs. Solopreneurs are entrepreneurs whose plan is to forge forward by themselves without the hassle of offices, employees and many of the other day to day struggles that face most businesses.

But even a solo must consider certain basics, especially when it comes to setting up that thriving one man band in your home.

One of the biggest issues may be that of risk. Address this issue with your insurance agent to ensure that you’re well protected. Ask yourself if your new at home business will host customers there. If yes, that raises the issues of everything from appearance to safety and insurance. Even if a customer is simply dropping something off at your home, perils exist. It may be a slip and fall or a tree that falls on their car and injures someone in the passenger seat.

The same may hold true for outside companies that may be visiting the home for business purposes. It could be the firm that delivers paper for your printer or the new computer. While some of the larger companies who may provide these services are likely to have all the requisite coverage that they may need to protect their employees, their insurance company is likely to look at the source of the claim and try to surrogate it to anyone else who may be even partially liable for the incident.

Your form of ownership should be examined. Just because you intend to be solo operating out of the home doesn’t mean that you have to limit the form of ownership. When you are truly self-employed and file a schedule C for tax purposes, you are considered a sole proprietor. That means that every last asset you own is subject to the claims of creditors, predators and lawsuits. Yes, everything may be fair game when it comes to a nasty litigator breathing down your neck. Consider incorporating or forming an LLC for possible asset protection. Seek wise counsel when doing this because the sole act of forming an entity alone will not protect you.  How you operate and hold yourself out to the public are just as important and a good advisor can lay out the basics for you.

The last issue may be that of part time employees or sub-contractors you may someday need. Just because you decide that someone is going to be an outside contractor instead of an employee doesn’t mean that you are off the hook for things like workmen’s compensation insurance or professional liability coverage.

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John P. Napolitano CFP®, CPA is CEO of U. S. Wealth Management in Braintree, MA. Visit JohnPNapolitano on LinkedIn or uswealthnapolitano.com. The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax advisor. US Wealth Management, US Financial Advisors and LPL Financial do not offer tax advice. John Napolitano is a registered principal with and securities offered through LPL Financial, Member FINRA/SIPC. Investment advice offered through US Financial Advisors, a Registered Investment Advisor. US Financial Advisors and US Wealth Management are separate entities from LPL Financial. He can be reached at 781-849-9200.