Internal Revenue Service initiatives are on the horizon that will drastically effect independent limousine contractors and operators within the state of Florida. The IRS has a major employment tax enforcement initiative focused on reclaiming earnings from independent contractors and operators. Over 6,000 audits will be performed over the next three years.
The ‘Taxpayer Responsibility, Accountability, and Consistency Act of 2009’ is currently active in the Senate and House of Representatives that seeks “to amend the Internal Revenue Code of 1986 to modify the rules relating to the treatment of individuals as independent contractors or employees, and for other purposes.”** This legislation seeks to crack down on the reporting of income from independent contractors and would substantially increase the penalties up to $3,000,000.
With such a high percentage of independent limousine services in Florida, this state will certainly be a target of these investigations. This poses crucial questions for limousine companies that hire independent drivers and contractors:
This poses many questions:
– Will you be a target?
– Will you be ready?
FLA understands the challenges that limousine owners and contractors face and the catastrophic impact that these new initiatives could have on your organization and your ability to do business.
We are committed to providing our contributors with the education and resources that will assist your business should you become a target of new legislation and collection efforts.
Our education and resources section will provide you with numerous resources to assist you.
*Information taken from Caplin & Drysdale Tax Alert, February 19, 2010
**Information from the U.S. Library of Congress: 111th CONGRESS, 1st Session, S.2882 and 111th CONGRESS, 1st Session H.R. 3408