States and IRS Now Probing Home Builders.

The Wall Street Journal posted an article recently which talked about co-employment risk in the home builders industry. The article also mentioned that industries such as hospitality, janitorial, agriculture, day care, health care and restaurants are also under scrutiny because they often incorrectly classify their workers as consultants.

Many of these employers are hiring independent consultants to get around paying the employer side of taxes. Employers of independent consultants are not liable for these taxes because the independent consultant is supposed to be paying for them himself. As the article points out, many independent consultants are not paying workers compensation which raises the rates for the legitimate consultants. 

iamindependent.com came into existence in response to these problems. The IRS and state governments could solve many accounting problems by requiring independent consultants to find an employer of record for their back office needs. This would make sure that businesses aren't abusing payroll loopholes and that independent consultants meet all of their filing requirements. 

To read the full article on the WSJ website please visit the following link.

http://online.wsj.com/article/SB10001424053111903927204576574892314453196.html?KEYWORDS=states+irs+homebuilders

If you have any other suggestions as how to solve the risk of co-employment please let us know in the comments section. 

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