Hi David,

>Thanks for your advice. Part of the problem is that she doesn't perform web design for other clients, which may look a little odd. She is doing this for me as a favor and a way to make a little side money. However, she works on her own schedule, works at her home, and provides her own tools.
>

Does she do other kinds of consulting for other clients? The key here is that she has other clients and they pay her to do work for them, it doesn't matter what she does for them, just that she does it independently.

If she doesn't have any other clients, this could be a problem.

>I will tell her to take out a business license and suggest that we have a written contract between us. Unfortunately, I cannot afford a lawyer at the moment, but I will consult with one as soon as my situation improves. It's pretty tough trying to sort out all of the different legal issues without a lawyer.
>

She needs to set herself up as an independent consultant also. She needs to send you invoices for the work she does for you.

HTH,
Jacci