Michigan employers that use independent contractors should make sure all their documentation is in order. Michigan is part of a pilot project initiated by the IRS to find employers that provide 1099 forms for workers who should be paid as employees.
The pilot program is a partnership among the IRS, U.S. Labor Department, National Association of State Workforce Agencies, Federation of Tax Advisors and the workforce agencies of California, Michigan, New Jersey and North Carolina. The partners share data on suspect employers and send investigative leads to one another. Eventually, the program will be in all 50 states.
Note: HR Specialist’s publication, Using Independent Contractors, provides employers with sound guidance to help keep them from running afoul of IRS, Labor Department and state workers’ compensation program regulations.