The latest issue of Valuation published by the Appraisal Institute includes an article titled “Declaration of Independents“. This article details the ways in which the IRS determines the classification of an appraiser. The shops I’ve worked in, and they appear typical in my region at least, only hire appraisers as independent contractors. The article indicates this may be incorrect and carry substantial financial consequences.
However, it appears these decisions are made on a case-by-case basis, as there is some ambiguity concerning the classification. Any appraisal shops out there with independent contractors should give the article a look.