The classification of workers as either employees or independent contractors significantly impacts a company's obligations under tax and employment laws. The distinction between these classifications, however, is often not clearly defined or understood.
Multiple government agencies have announced their intent to focus on this issue. The IRS recently announced increased enforcement efforts, including audits of 2,000 randomly selected taxpayers for the next three years. In addition, the Obama administration, the Equal Employment Opportunity Commission and the Attorney Generals of several states have taken increasingly active roles in the investigation and enforcement of employee classification matters. Experience has shown that challenges to worker classification under the tax law often spark related inquiries under employment laws (and vice versa).
In this session, we will cover:
- The impacts of worker classification from a tax and employment law perspective;
- The administrative and judicial tests applied to determine whether workers are employees or independent contractors;
- Proposed changes in the law; and
- Practical tips to prepare for administrative audits and litigation.