(1) As provided in 39-71-417 , MCA, a person who regularly and customarily performs services at locations other than the person's own fixed business location and who has not elected to be personally bound by the provisions of workers' compensation plan 1, 2, or 3, shall apply for an independent contractor exemption certificate. In order to obtain an independent contractor exemption certificate, an applicant shall:

(a) submit a completed department application affidavit form bearing the applicant's original notarized signature in which the applicant swears or affirms under oath that the statements contained in the form and attached documentation are true and accurate to the best of the applicant's ability, which includes, but is not limited to:

(i) the applicant's correct name;

(ii) the applicant's correct social security number;

(iii) each occupation for which the applicant is applying; and

(iv) for each occupation listed, the:

(A) business name used;

(B) business structure (entity type) ;

(C) business mailing address; and

(D) business telephone number;

(b) pay a fee, as required by ARM 24.35.121;

(c) submit an executed waiver bearing the applicant's original notarized signature and conforming to the requirements of (3) ; and

(d) submit documentation with the affidavit confirming the applicant is engaged in one or more independently established trades, occupations, professions, or businesses. The applicant's documentation for each trade, occupation, profession or business must receive 15 points or more to qualify the applicant for an exemption certificate for that trade, occupation, profession, or business. The value awarded to various types of documentation is as set out in (2) .

(2) Documentation supporting the applicant as independently established in a trade, occupation, profession or business is divided into point groups as designated below. Each point group is made up of separate categories of documentation. A maximum of two items may be submitted to receive the total points for each category. The department has the discretion to assess the reliability of the documentation and to award points for the items submitted up to the total points for each category. Each item of documentation submitted may only count toward points in one category.

(a) The 10 point group includes workers' compensation, unemployment insurance, and department of revenue accounts for employees. This documentation is worth up to 10 points for all three types of proof submitted together, up to six points for two types of proof, and up to three points for one type of proof.

(b) The six point group includes:

(i) a contract or memo of understanding. Elements of the contract that may show proof of independent contractor status include but are not limited to:

(A) payment based on a completed project basis;

(B) an ending date of the contract;

(C) liability for failure to complete the project;

(D) identification of who provides the materials and supplies;

(E) signatures by both parties; and

(F) a defined body of work, complete project, or end result;

(ii) a list of equipment and tools owned or controlled by the applicant with approximate value. This may be demonstrated by a rental or lease agreement, county documents verifying the business equipment tax paid, or other means;

(iii) proof of business location ownership, rent or lease. This may be demonstrated by an IRS form filed for claiming use of the home as a business, otherwise known as Form 8829;

(iv) a commercial general liability insurance policy or bonding;

(v) filed business tax forms;

(vi) two business tax receipts and/or IRS Form 1099s (miscellaneous income) ; or

(vii) a trucking company lease agreement.

(c) The three point group includes:

(i) two or more bids or estimates;

(ii) a partnership agreement. An applicant that is a working partner in a partnership or limited liability partnership must submit a written partnership agreement signed by all partners. Elements of the agreement that show proof of independent contractor status by virtue of a valid partnership include at least:

(A) intent to form the partnership;

(B) contribution by all partners;

(C) a proprietary interest and right of control by the working partner applying for an exemption certificate; and

(D) the sharing of profit/loss;

(iii) application for, or an issued business license or building permit;

(iv) a professional license. Applicants who are in a licensed profession must submit proof of compliance with the licensing requirements of that profession;

(v) a certificate demonstrating the business structure is registered with the Montana secretary of state;

(vi) a certificate demonstrating the business has a registered name with the Montana secretary of state;

(vii) educational certification;

(viii) membership in a professional association or affiliation; or

(ix) copies of advertising in a newspaper, phone book or on the internet.

(d) The one and a half point group includes:

(i) a federal employer identification number (FEIN) ;

(ii) a business bank account;

(iii) a telephone bill in the business name;

(iv) a credit card or charge account in the business name;

(v) printed invoices, cards, or brochures;

(vi) proof of orders for printed hats or shirts;

(vii) proof of advertising using a sign on vehicle, in yard, bulletin boards, corner lamp post, flyers; or

(viii) printed billing invoices.

(e) The applicant may submit any other supporting documentation. The department has discretion to assess the reliability of and determine the point value of any documentation not listed in this rule.

(3) The department waiver requires the applicant to make the following representations for each trade, occupation, profession or business for which the applicant is seeking an independent contractor exemption certificate:

(a) that the applicant is engaged in each independently established trade, occupation, profession or business which is specifically identified on the affidavit;

(b) that the applicant is responsible for all taxes related to the applicant's work as an independent contractor;

(c) that the applicant controls the details of how to perform the contracted for services, both under contract and in fact, and that the hiring agent retains only the control necessary to ensure the bargained for end result; and

(d) that the applicant understands and agrees that if the independent contractor exemption certificate is granted, the applicant waives the applicant's right to and is not eligible for workers' compensation benefits or occupational disease benefits for an injury or occupational disease related to work performed as an independent contractor for which the exemption certificate is granted.

(4) An application that is approved, and for which the exemption certificate is issued, shall be in effect for two years unless the department revokes or suspends the exemption certificate or is notified in writing prior to the expiration date that the exemption certificate holder wishes to have the exemption certificate cancelled.