The New York Times is now reporting about the government crack down on misclassified workers. I’ve been reporting for the past couple years that the federal government, and most states, are cracking down harder on worker misclassifications. I’ve told you it is a politically correct way to increase revenue for any government agency that needs [...]
Just when you think you’ve heard it all-the IRS recently issued a public notice that using FORM 1099-OID can constitute a “Frivolous Tax Argument” punishable by jail time and big fines. Washington DC-The IRS recently issued its 2010 list of “Frivolous Tax Arguments” that it doesn’t want to hear from any of us. One of [...]
Do you have two minutes? Take this short test to see if you are misclassifying your consultants. Clients often ask us for the magic pill, the quick and simple way to know if a consultant is properly classified as an Independent Contractor (IC) or not. The truth is there is no simple test. Common law [...]
For each project extension do you draft up a new contract and go blissfully forward thinking you are protected? I’ve seen the “Status Drift” phenomenon pop up again and again over the years: The three month project that became another three month project that became a six month project that became a semi-permanent engagement ultimately [...]
In my seminars I often tell a story about the worker who insisted on being independent when his project was created. “He’s a ‘1099′ and has always worked as one,” the hiring manager pleaded… “He won’t take the job unless we bring him on as an IC.” Fast forward two years later. The project well [...]
Because there are a whole bucket of reports and taxes that must be filed and paid this time of year. Think of the next couple months as the Holiday Season for Tax People! What’s happening? Due by January 31, 2010 Forms W-2: You must furnish each employee a completed Form W-2, Wage and Tax Statement. [...]
One of the most common misunderstandings I encounter involves engaging consultants who have their own corporation-sometimes referred to as “corp-to-corp.” It is a common belief that just because the consultant has his/her own corporation the client company is automatically off the hook for employee misclassification issues. Forming a corporation is not a misclassification “magic pill.” [...]
Why does providing items like a computer, email, telephone, office supplies, tools, software applications, workspace, etc. tend to make someone an employee? Many would argue that since “direction and control” is the primary factor that as long as you let the consultant have freedom on how to do the work he/she is an independent contractor. [...]
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