Many businesses use independent contractors to help keep their costs down. If you’re among them, make sure that you properly classified these workers as independent contractors for federal tax purposes. If the IRS reclassifies them as employees, it can be a costly error. It can be complex to determine whether a worker is an independent
The new employee classification rule simplifies the process in some ways, but it generates new questions that business owners should be prepared to tackle.
The classification of workers as independent contractors or employees has significant implications — both tax and nontax — for all businesses.
As a result of the coronavirus (COVID-19) crisis, your business may be using independent contractors to keep costs low. But you should be careful that these workers are properly classified for federal tax purposes. If the IRS reclassifies them as employees, it can be an expensive mistake. The question of whether a worker is an
Many employers prefer to classify workers as independent contractors to lower costs, even if it means having less control over a worker’s day-to-day activities. But the government is on the lookout for businesses that classify workers as independent contractors simply to reduce taxes or avoid their employee benefit obligations.