The business model for independent brokerage firms is under threat, calling into question the livelihood of more than 178,000 registered representatives.

Currently, independent brokerage firms pay their reps as contractors, allowing them to work for themselves. But a piece of legislation introduced in the House in late July by Rep. Jim McDermott, D-Wash., and in the Senate in December by Sen. John Kerry could lead to high costs and extra hassle for independent broker-dealers.

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