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ZeroChaos promises to rescue independent contractors from administrative evils

If you're an independent contractor and you're overburdened with taxes, insurance, and payment issues, ZeroChaos may provide some needed relief from these tasks. Find out how this online service works.

Although ZeroChaos features a whimsical comic book superhero theme, the Orlando, FL, company behind the site promises serious benefits for freelancers, independent contractors, and consultants.

“Downtrodden freelancers! There is no impending doom with ZeroChaos,” promises one of the site’s pages. “Evils such as administrative paperwork, insurance nightmares, and do-it-yourself tax reports are now crushed. With ZeroChaos, you work when, where, and how you want with nothing shackling you down.”

Independent consultants know what a headache it can be to navigate through a mountain of complicated administrative tasks. We’ll show you how ZeroChaos can take some of the pain out of these activities and offer other useful benefits to workers flying solo.

Tax benefits
By purchasing a membership, you become a ZeroChaos employee, but you also become the CEO of your own business unit. You still find your own clients and set your own hours and pay rates, and, best of all, you get to keep all your tax write-offs—even though you’re a W-2 employee.

“The key aspect of our offering is that, from a tax standpoint, you still are able to deduct all your legitimate, nonreimbursable, nonbillable business expenses,” said Roger Dunnavan, the company’s executive vice president of strategic alliances. “Your cell-phone calls, Internet connection, office supplies, computer lease, health-insurance premiums, client meals, certifications, training courses, plane tickets to go get your next gig—you can continue to write off all those types of expenses by having your business unit pay them. That is the key difference between us and staffing firms and most of the other players out there.”

The majority of ZeroChaos members are consultants in the technology, engineering, and training industries, but the company also offers services to financial and management consultants, real-estate agents, and creative artists. Fees to join ZeroChaos start at about $140 per month.

How it works
As a member of ZeroChaos, you still negotiate your own rates and terms, but the company does offer help with drafting contracts. While you’re working for a client, you can also submit time sheets and expenses to ZeroChaos through the company’s secure site. The process is 100 percent Web enabled.

After you complete a project, ZeroChaos will send an invoice to your clients and hold them to the billing terms stated in your contract. You get collection support if you run into any problems.

When ZeroChaos receives a check from your client, the company will take out money for various expenses, such as membership fees, insurance premiums, and contributions to your 401(k) account. Then it will take out taxes, so you’re technically taxed on a smaller portion of your income. As a W-2 employee, you’ll pay FICA, which covers Social Security and Medicare, and you’ll pay state and local taxes if applicable. Your business unit will pay the employer FICA, FUTA (federal unemployment tax), SUI (state unemployment insurance), and worker’s compensation.

Finally, you will receive a check from ZeroChaos for your net pay. The company promises to process your payroll and initiate a deposit into your account or mail you a check within two business days after it receives the money from your client.

Other benefits
Besides helping with administrative paperwork and taxes, independent professionals who join ZeroChaos also can sign up for group rates on health and dental insurance, and they receive free general liability, life, and disability insurance. (The free term life policy is worth $50,000, and the disability insurance covers up to 60 percent of your income.)

Also, when you apply for loans or credit cards, you might be able to increase your chances of getting them from companies that are wary of freelancers by listing ZeroChaos as your employer. You can, however, cancel your membership at any time if you’re unsatisfied with its services or if you take a full-time job.

The ZeroChaos Web site offers several pages that outline the benefits of membership for people in specific situations, including 1099 independent contractors, self-incorporated professionals, people who get jobs through staffing firms, and IT workers who are considering making the leap from the corporate world to independent consulting.

For more information, you can register with the site through an online form, call toll free 1-877-844-ZERO or (407) 447-3000, or e-mail your questions to groundzero@zerochaos.com.

Thomas Pack is a freelance technology reporter.


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