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What is a Workers Compensation Exemption? How do I File?

how to file workers compensation

By Jean Murray. US Business Law / Taxes Expert

Jean Murray has the education and experience to help you become an expert in your small business, and to provide you with information about business legal and tax issues. With an MBA and a PhD in entrepreneurship, she brings almost 30 years of experience and knowledge to these important business subjects.

You can also read more about Jean's current and past work on her page.

DISCLAIMER: I am not a CPA or attorney, and nothing on this site in articles, emails, blog posts, or other communications is intended to be tax or legal advice. The purpose of this site is to provide general information to readers. No claim is made regarding the accuracy or legal status of information on this site. Federal, state, and local laws and regulations change, and every business situation is unique. Readers should not take action on any tax or legal matter without reviewing options with a tax advisor or attorney.

To explain

further: In all states, businesses hiring employees must pay for state workers compensation coverage in the event that an employee is injured or becomes ill due to a workplace illness or injury. Thus, workers are required to be insured under a workers compensation policy. But independent contractors are not workers. In some states, these independent workers are required to state that they are "free from control" for specific occupations. Typically, the statement must be notarized and a fee is charged for this waiver or exemption declaration.

Here are some examples:

Florida considers LLC owners (members) to be employees. But they do allow an individual to file an application for an exemption from workers compensation.

The Tennessee workers compensation exemption is specifically for certain construction service providers.

In New York. you may only apply for a workers compensation exemption if you are an "entity" "with no employees and/or out-of-state entities obtaining a contract or license in which all the work is being performed outside of New York State."

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