IRS Begins Extensive Employment Tax Audits

A three-year Internal Revenue Service employment tax audit program of 6,000 businesses begins February 16, 2010. Agency officials report that small businesses will make up the bulk of targeted companies. The audits will include extensive examination of employee-independent contractor status, and will collect valuable statistical information on the employment tax gap. The IRS said the audits will provide data for its first statistical analysis since 1984 of how often companies misclassify workers to avoid employment tax obligations. John Tuzynski, chief of employment tax operations at the IRS, reports that the majority of these audits will occur face-to-face. Employment tax audits are part of the IRS' National Research Program (NRP).