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Worker Classification Issues

Whether the people who perform services for your business are considered as employees or independent contractors continues to remain an audit priority for the IRS and FTB. Employers are required to withhold certain taxes on behalf of their employees but not for independent contractors. An audit by the federal or state taxing agencies that reclassifies an independent contractor to employee status may result in overwhelming payroll tax and penalties for business owners.

At Advocate Solutions, Inc., we have the expertise to provide guidance in forming legitimate contractor relationships, reviewing current business practices and representing your business in a tax audit. If you have already been assessed for misclassification of workers, we can represent you in an appeal before the IRS or file a petition on your behalf before the California Unemployment Insurance Appeals Board regarding a contested EDD assessment. We also provide bankruptcy consultation to reduce some of the tax liability.

Factors for determining proper worker classification vary at the state and federal levels, but one of the primary issues is whether the principal exerts control over, or has the right to control the worker. Other factors about the nature of the work relationship are used to guide determination if the right to control is absent or undetermined.

We have a successful track record in guiding employers through the process of worker classification, representation at audit, and defending against the government claims of misclassification.

Contact an Attorney About Worker Classification Issues

For more information or to schedule a consultation with an attorney at Advocate Solutions, Inc., call 310.734.2677 or fill out the contact form on this site.