Classifying workers as independent contractors can save employers as much as 30% on their payroll costs. As an independent contractor the employer does not have to pay the state unemployment, federal unemployment, no social security and medicare matching plus no workers comp or other benefits. The IRS has hired 100 employees to go after the business most likely to try to evade employment taxes. Those businesses are small firms and self employed individuals. With the newest computer technology the IRS and the States are now sharing information.
If you are unsure of how to classify a worker the IRS offers a free determination service or if you would rather not deal with the IRS call KatTax and we can help you.
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