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Independent Contractors vs. Employees?


If an employer is selected for an employment tax audit, IRS Revenue Agents will thoroughly review issues related to:

  1. Worker Classification
  2. Employee Benefits
  3. Executive Compensation
  4. Non-Filers; and
  5. Employee Reimbursement Plans

For many employers, a review of worker classifications will present the greatest challenge.

A worker may be classified as either an employee or as an independent contractor.
These classifications have significant tax and labor law implications. Revenue Agents will
review a company’s independent contractors to determine if those individuals should be
classified as employees and, as a result, be subject to income tax withholding and employment

If the Service finds that the workers are misclassified, the determination will impact the
employer's state tax and unemployment insurance obligations and may expose the employer to
claims for unpaid wages and overtime. It is crucial that employers take a proactive approach, review their internal policies regarding independent contractors, and make any necessary classification changes in anticipation of audit selection.

Hire an Experience Tax Attorney To Defend Your Business During an Audit!

Don't worry that hiring a professional may give some indication of guilt; the IRS is used to it, and in many instances might prefer dealing with a professional familiar with the process.

If you're feeling anxious about any of the above-mentioned items which the IRS is trained to look for during business tax audits, consider hiring an Experienced Tax Attorney:

  • Who routinely handles these types of audits,
  • Who can successfully represent your business during an IRS tax audit and
  • Who can defend your business from further Governmental Action!


If you have been contacted by the IRS or a State/Local Taxing Authority, regarding a possible Tax Audit, contact Marini & Associates, PA immediately for assistance in representing and defending you from further Governmental Action and Assessments!

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