Challenging IRS Reclassification of Workers in Tax Court

If the IRS thinks a worker being treated as an independent contractor should be classified as an employee, it sends a notice to the employer. There’s a safe harbor—called Sec. 530 relief—that employers can use to escape employment tax penalties, but it’s not always applicable. The IRS has guidance on when an employer can challenge in Tax Court the reclassification as an employee or where Sec. 530 relief isn’t available. #IdeaoftheDay