How are caregivers, or elderly in home care attendants considered independent contractors? -

Only if they are hired by an agency who gives them a 1099 form to fill out, instead of W-2 and then they have to pay the agency and collect money from the people they care for. I ve never heard of that - maybe being self-employed would be a better way to go.

This is a hot issue with the IRS. They have compiled a 20 question litmus test that you can take to determine if someone should be paid as a subcontractor (1099) or as an employee (W2). Please visit this link for the IRS publication http://ftp.irs.gov/pub/irs-regs/subcontractorstext.prn.pdf.Good luckGus