WASHINGTON DC- As I shared earlier this week, the IRS’ National Taxpayer Advocate, Nina E. Olson, released her annual report to Congress, (required by federal statute) dated December 31, 2009, warning that (the IRS struggling because) it “is subject to three diverging forces…”
Increased responsibility for non-core tax administration duties,
Increasing demand for taxpayer service,
Declining resources to […]
In my seminars I tell participants that, “Over 70% of all employment tax audits find misclassified workers, resulting in a tax assessment.”
The reason the number is so high is because tax agencies rarely select a company for an employment tax audit unless they suspect there are misclassification errors. This means the auditor shows up the […]
WASHINGTON DC-The IRS’ National Taxpayer Advocate, Nina E. Olson, wants to improve “state information sharing tracking metrics” on misclassified workers.
The Taxpayer Advocate’s report released to Congress, dated December 31, 2009, lists the type of information that is shared between the IRS and local state enforcement agencies.
The IRS receives:
The state income information
Sales information (e.g., from local […]
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 money […]
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 is […]
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 turns […]
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… Â
“He won’t take the job unless we bring him on as an IC.”
Fast forward two years later. The project well has dried up. […]
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. You typically have […]
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.”
Forming a […]
Why does providing items like a computer, email, telephone, office supplies, tools, software applications, workspace, etc. tend to make someone an employee?Â
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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