Tax Issues With Worker Classification
Controversies between the IRS and employers and employees often arise regarding worker classification issues — specifically, whether or not a worker is an independent contractor or employee.
Employee Or Contractor?
Independent contractors are issued 1099 forms by their employer for labor or services provided. The employer does not pay any taxes to the IRS on behalf of the independent contractor. Employers, on the other hand, are obligated to withhold the necessary taxes, including Social Security and Medicare taxes, from the employee’s pay.
Employers face severe penalties if they misclassify their workers. If you were the person responsible for the misclassification, you can be held personally liable for what taxes should have been withheld and paid to the IRS. Employees, likewise, who are classified as independent contractors, but who fail to pay their full share of Social Security taxes, may be subject to penalties and even criminal charges.
Protecting Your Business With Our Experience
Tax attorney Fred L. Baker has more than 45 years of experience in tax law. In addition to possessing an LLM (Master of Laws) in taxation, he is a former trial attorney for the Internal Revenue Service’s Office of Chief Counsel in New York City. This means he knows both sides of all tax issues and knows the techniques the IRS uses and also how to combat those strategies in negotiations and in federal court.
The Baker Law Firm, P.C. serves individuals and businesses throughout Connecticut. Contact Danbury worker classification attorney Fred L. Baker at 203-648-4737 to arrange a confidential consultation about your tax issues.