Wow, this is great information. Yes, I'm in the Denver area. As for my position, I was hired as a Senior System Administrator and definitely have the responsibilities of one. I have about 5 years experience in Linux administration, but obviously less experience in the contracting/business/taxes side of things.

You're right on the risk compensation, though this company is known for hiring contractors for long periods of time (some contractors here have been here longer than 5 years). So though it is a very real risk, I'm not as worried about it as I would be otherwise.