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California Payroll Tax Audits and Defending Independent Contractors

  You may be familiar with or have heard of a twelve-factor test or a three-factor test or a lot of different tests that the EDD supposedly uses to classify independent contractors. Through my years of professional experience and time spent in a lot of California payroll tax audits, I will just tell you that […]

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EDD Independent Contractor Test

  After verifying payroll and payroll tax withholdings, the EDD will next go through and verify all the workers that the business issued 1099s to. This is what is known as the EDD Independent Contractor Test. First, the EDD auditor will go through each 1099 worker in detail, one by one. Even 1099’s that were […]

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EDD Audit Payroll Tax Verification Test

  In addition to the payroll verification test, https://www.sambrotman.com/edd-audit-payroll-verification-test/, the EDD will also look at personal income tax withholdings and make sure that the amounts listed match what the state has on file as well. Just to go back and clarify, the EDD audit is going looking at the wages and the income that the […]

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EDD Audit Payroll Verification Test

  Our last article, https://www.sambrotman.com/independent-contractor-audit-initial-interview-purpose/, we discussed the purpose of the EDD audit initial interview questions. Those initial questions just kind of go through some of the background information on the business and help to explain that. After the initial interview, the EDD will conduct what they call a payroll test. The purpose of this […]

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Independent Contractor Audit – Initial Interview Purpose

  In our last article, https://www.sambrotman.com/edd-independent-contractor-audit-initial-compliance-interview/, we examined the questions that are asked in an independent contractor audit. In this article, we would like to examine the purpose behind those questions in a little more depth. The auditor’s first goal in an independent contractor audit is establishing a system and a pattern of routine for […]

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EDD Independent Contractor Audit – Initial Compliance Interview

  The first thing that happens in an EDD independent contractor audit is the initial compliance interview. The initial compliance interview serves a couple of different purposes. Number one, it is to get background information on the client. Number two, it is to get answers in place for different questions in case there is any […]

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Independent Contractor Reclassification Audit

The Employment Development Department in California has been particularly aggressive in the area of independent contractor reclassification audits. In the eyes of the Employment Development Department, California businesses have been abusing the system by treating workers who should be classified as employees as independent contractors. In doing so they shift the burden for payroll taxes […]

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