Taxation is just one of many areas of law involved in disputing a workers status as either an employee or an independent contractor for the purposes of payroll taxes. Because of recent improvements in the exchange of information between federal and state agencies, one investigation into a workers status may trigger another. Or, a dispute by one worker can domino into additional disputes by other workers. If a business owner misclassified a workers status a number of years ago, it could be found responsible for significant federal and state employment tax deficiencies and penalties, as well as a variety of benefits if the worker sues and is ultimately determined to be an employee.

The IRS use the following list of 20 factors to examine the nature of the relationship between a business and a worker and make a determination between employee or Read More

a. Behavioral Control


The most fundamental difference between employees and independent contractors is that employers have the right to tell employees exactly what to do and how to do it. This is a recipe for disaster for the employer that intends to treat its workers as independent contractors. Whatever you do, don’t supervise or control an independent contractor as if he was one of your employees. It’s perfectly okay to provide detailed guidelines or specifications for the results that you expect from your contractors. But how those results are achieved must be left entirely up to the contractor. Read More