October 2014 Independent Contractor Compliance and Misclassification Update

TAX COURT DECISION REMINDS COMPANIES THAT "OFFICERS" ARE STATUTORY EMPLOYEES AND THEREFORE CANNOT BE INDEPENDENT CONTRACTORS. The United States Tax Court held that a company that was engaged in the buying, reconditioning, and selling of cars misclassified as independent contractors instead of employees two of its officers and another worker and failed to pay employment taxes on their earnings.



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