Nonpayment and underpayment of employment taxes has been identified by the IRS as contributing $54 billion to the approximate $285 billion tax gap. The IRS has been receiving leads on cases in which workers may have been misclassified, with 19,000 requests since 2004 to make a determination on whether a worker is an employee or an independent contractor (“SS-8 inquiries”).
Kathryn Keneally and Charles P. Rettig, in their column in the Journal of Tax Practice & Procedure, give the details of how the IRS will carry out increased audits in this area.
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This story is from the CCH’s monthly Focus on Tax newsletter, which provides advise and guidance on federal and state tax issues for tax and accounting professionals.
Read this article from CCH’s Journal of Taxation of Financial Products