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Manage Contractors

Using independent contractors can not only save a company money, but it can also enable companies to explore higher risk and higher return projects because the investment is not as great. But the government has kept a cloud over the use of independent contractors. This is causing many accountants and some lawyers to recommend not using them at all, or outsourcing overseas instead. This is not always the right solution.

Is just signing a contract enough? Not usually. But creating a system that includes an analysis of your independent contractor usage, well written contracts and procedures can help. This system limits both the risk of an audit, and the odds of losing the audit should one occur.

I have extensive experience in crafting just such systems. I have successfully defended EDD audits in excess of $700,000 (that would have been close to a $7million IRS audit) and have set up systems that have allowed our clients to win reassessment appeals when others in their industries have lost all appeals. I have a 90% success rate in defending EDD independent contractor reassessment cases. This is because we are very realistic and will not tell you that something is defendable if it’s not.

If you have any concerns about your usage of independent contractors, or you’d like to use them, but have been told not to by others, please give me a call or drop me an email to see if I agree. If you have an EDD reassessment petition currently outstanding, definitely call now.

There are also many posts about independent contractor issues on our weblog.