Article Side

Online Article Directory!

Hello Guest! Login or Register to submit articles!

IRS Announces New Voluntary Worker Classification Settlement Program (VCSP)

By Manendra Kothari Subscribe to RSS | January 23rd 2012 | Views:
loading
 
  



This is part of a larger “Fresh Start” initiative at the IRS to help taxpayers and businesses address their tax responsibilities for which employers face no deadline.

“This settlement program provides certainty and relief to employers in an important area,” said IRS Commissioner Doug Shulman. “This is part of a wider effort to help taxpayers and businesses to help give them a fresh start with their tax obligations.”

The new Voluntary Classification Settlement Program (VCSP) is designed to increase tax compliance and reduce burden for employers by providing greater certainty for employers, workers and the government. Under the program, eligible employers can obtain substantial relief from federal payroll taxes they may have owed for the past, if they prospectively treat workers as employees. The VCSP is available to many businesses, tax-exempt organizations and government entities that currently erroneously treat their workers or a class or group of workers as nonemployees or independent contractors, and now want to correctly treat these workers as employees.

To be eligible, an applicant must:

> Consistently have treated the workers in the past as nonemployees,

> Have filed all required Forms 1099 for the workers for the previous three years

> Not currently be under audit by the IRS, the Department of Labor or a state agency concerning the classification of these workers

Interested employers can apply for the program by filing Form 8952, Application for Voluntary Classification Settlement Program, at least 60 days before they want to begin treating the workers as employees.

Employers accepted into the program will pay an amount effectively equaling just over one percent of the wages paid to the reclassified workers for the past year. No interest or penalties will be due, and the employers will not be audited on payroll taxes related to these workers for prior years. Participating employers will, for the first three years under the program, be subject to a special six-year statute of limitations, rather than the usual three years that generally applies to payroll taxes.

A taxpayer participating in the VCSP will agree to prospectively treat the class or classes of workers as employees for future tax periods. In exchange, the taxpayer:

> Will pay 10 percent of the employment tax liability (just over one percent of the wages paid ) that may have been due on compensation paid to the workers for the most recent tax year, determined under the reduced rates of section 3509(a) of the Internal Revenue Code.

> Will not be liable for any interest and penalties on the amount; and

> Will not be subject to an employment tax audit with respect to the worker classification of the workers being reclassified under the VCSP for prior years.

Shulman and Secretary of Labor Hilda Solis signed an agreement earlier this week to improve their coordination on preventing businesses from misclassifying employees as independent contractors. Under the program, eligible employers can obtain substantial relief from federal payroll taxes they may have owed in the past, if they prospectively treat workers as employees. The VCSP is available to many businesses, tax-exempt organizations and government entities that currently erroneously treat their workers or a class or group of workers as non-employees or independent contractors, and now want to correctly treat these workers as employees.

If you believe that you are about to be audited or investigated for your worker classifications – perhaps because a former worker or a competitor is about to blow the whistle or he already made a claim for unemployment benefits or workman’s comp, please call us to find out if you should be participating in this amnesty program

Manendra Kothari - About Author:
Manendra Kothari, CPA
127 S. Roselle Rd Ste # 200 Schaumburg, IL 60193
Phone: 847.524.0001
Email: MKothari@SKTaxes.com
Web: www.Indiancpa.US

Share on Facebook Tweet It Stumbleupon this post This post is delicious !

Article Source:
http://www.articleside.com/business-articles/irs-announces-new-voluntary-worker-classification-settlement-program-vcsp.htm

Related Business Articles Subscribe to RSS

2012 Maserati models line-up
Published by R Passione on December 7th 2011 | Business
The model line-up also includes the GranTurismo S Automatic and the Quattroporte, both recipients of...
 
The European Cross-Border Electricity Interconnectors Market 2012-2022
Published by Bharatbook on April 3rd 2012 | Business
Bharatbook added a new report on " The European Cross-Border Electricity Interconnectors Market 2012...
 
PC Peripherals Market in India 2012
Published by Bharatbook on June 9th 2012 | Business
Bharatbook added a new report on "PC Peripherals Market in India 2012" which gives an overview, Dem...
 
The Middle East Government Directory 2012
Published by Bharatbook on May 4th 2012 | Business
Bharatbook added a new report on "The Middle East Government Directory 2012" which gives an overview...
 
Latest Hyundai car prices in India 2012
Published by Mike Nielsen on June 12th 2012 | Business
Hyundai has always made awesome cars by keeping in mind common man's demand and affordability. Here ...
 
Coronary Stents Market in India 2012
Published by Bharatbook on June 9th 2012 | Business
Bharatbook added a new report on "Coronary Stents Market in India 2012" which gives an overview, De...
 
The European Pharmaceutical Directory 2012 and the USA Pharmaceutical Directory 2012
Published by Bharatbook on April 28th 2012 | Business
Bharatbook added a new report on "The European Pharmaceutical Directory 2012 and The USA Pharmaceuti...
 
The European University Libraries Directory 2011-2012
Published by Bharatbook on May 4th 2012 | Business
Bharatbook added a new report on "The European University Libraries Directory 2011-2012" which gives...
 
India Male Cosmetics Market-Consumer Insight 2012
Published by Bharatbook on June 14th 2012 | Business
Bharatbook added a new report on "India Male Cosmetics Market-Consumer Insight 2012" which gives an ...
 
Airport Retail Trends in Asia-Pacific, 2012-2013
Published by Bharatbook on August 25th 2012 | Business
Bharatbook.com introduces a report "Airport Retail Trends in Asia-Pacific, 2012-2013" which gives...
 
USA Pharmaceutical Directory 2012
Published by Bharatbook on April 27th 2012 | Business
Bharatbook added a new report on " USA Pharmaceutical Directory 2012" which gives an overview, Dema...
 
Purple Bridesmaid Dresses Gallery in the 2012 Wedding
Published by Vponsale2012 on February 7th 2012 | Business
There are always some certain colours to adding elegance and beauty to your wedding. After I have in...
 
2012 U.S. Food & Health Supplement Stores Industry
Published by Bharatbook on April 16th 2012 | Business
Bharatbook added a new report on "2012 U.S. Food & Health Supplement Stores Industry" which gives an...
 
Business Indicators in the Mining Industry - 2012-2013 : Survey Brief
Published by Bharatbook on June 28th 2012 | Business
Bharatbook added a new report on "Business Indicators in the Mining Industry - 2012-2013 : Survey Br...
 
International Directory of Women's Organizations 2012
Published by Bharatbook on May 4th 2012 | Business
Bharatbook added a new report on "International Directory of Women's Organizations 2012" which gives...
 
Oil and Gas Market in China 2012
Published by Bharatbook on June 6th 2012 | Business
Bharatbook added a new report on "Oil and Gas Market in China 2012" which gives an overview, Demand...
 
Tips on Opting for Bridesmaid Dresses 2012
Published by Vponsale2012 on May 9th 2012 | Business
Everything will be on your shoulders before you become the wife. The wedding thing is a big deal for...
 
Retail Market in India 2012
Published by Bharatbook on June 9th 2012 | Business
Bharatbook added a new report on "Retail Market in India 2012" which gives an overview, Demand, Sup...
 
2012 U.S. Check Cashing & Loan Servicing Industry Report
Published by Bharatbook on April 13th 2012 | Business
Bharatbook added a new report on "2012 U.S. Check Cashing & Loan Servicing Industry Report" which gi...
 
Corporate Bond Market in China 2012
Published by Bharatbook on June 7th 2012 | Business
Bharatbook added a new report on "Corporate Bond Market in China 2012" which gives an overview, Dem...