Law Offices of James R. Urquhart III

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A Professional Law Corporation 81578 Camino el triunfo

Since 1977 Indio, CA 92203

Tel w +1 (949) 786-1170

Fax w +1 (714) 242-9972

E-Mail w LAW@JRU3.COM

Dear Legal, Accounting, Tax or Business Advisor:

You already appreciate the challenge presented when your business client uses independent contractors (ICs). When your clients use non-employees on a regular basis, they assume more risk than they can imagine. Worker employment classification is a key audit issue for agencies like the IRS, the State, the U.S. Department of Labor - Wage & Hour Division, and the State Workers’ Compensation Agencies.

For your consideration, here are three possible scenarios where we can be of service to you and your business clients.

• Misclassification Danger Not Appreciated
  I know from experience that most business advisors have problem clients that, "just won’t listen." The problem client has usually been advised — repeatedly — that the way he or she is using ICs is too dangerous.
• State Unemployment Claim by Worker Treated as IC
  This is always an unexpected crisis. Even a written independent contractor agreement cannot stop it from happening. Unemployment claims by workers not treated as employees are a key source of audit leads for the State unemployment compensation and employment tax auditors. An appropriate plan of action must be devised — immediately.
• IRS or State Employment Tax Audit
  IRS and State worker classification rules are complex, the exposure is immense, and auditors can be intimidating. There is important work to do — much of it before the first visit from the auditor.

The first necessary step is a consultation. There is no need to leave your office — most of our consultations are by telephone. As many as you wish may participate (i.e., business owner, attorney or accountant). If papers like letters or agreements need to be seen, you can fax them before or during the meeting. Many matters are adequately handled with a single meeting. If more legal work is needed (i.e., legal research, representation, correspondence, agreement preparation or review), that can be arranged during the first meeting.

I look forward to working with you to guide your business clients through the employment classification maze.

Sincerely,

James R. Urquhart III

James R. Urquhart III
Attorney at Law