How do I file a misclassification claim?

How do I file a misclassification claim?

1. Talk to your Employer. First, you can try to talk to your employer to see if it will review your classification and reclassify you as an employee.
2. Get the IRS Involved.
3. File Your Tax Return with IRS Form 8919.
4. File an Unemployment Insurance Claim.
5. File a Workers’ Comp Claim.

Is employee misclassification illegal?

If employers misclassify employees, they may be violating wage, tax, and employment eligibility laws. Organizations can be held liable for failing to pay overtime and minimum wage under the Federal Fair Labor Standards Act (FLSA) as well as under state wage laws.

What are the penalties for misclassifying an employee?

If the IRS determines that an individual has been misclassified, it may levy penalties against the employer, including, but not limited to, a $50 fine for each Form W-2 the employer failed to file on such employee, a penalty of up to 3\% of the wages, plus up to 40\% of the FICA taxes that were not withheld from the …

How do I know if I’ve been misclassified as an independent contractor?

Contractors typically use their own work equipment such as laptops and cell phones. If the company issues their own computer or cell phone or if you have a company email address or business card, those may all be telltale signs that you are being misclassified as a contractor.

What are the penalties for misclassifying employees?

What happens when you misclassified as an independent contractor?

California law also permits employees to recover civil penalties (like a fine) from employers who misclassify employees as independent contractors. California Labor Code Section 226.8 provides for civil penalties ranging from $5,000 to $15,000 per violation.

Why is employee misclassification a threat to workers?

Risky business. The risks of worker misclassification are considerable, as companies are subject to fines and back taxes. In addition, companies can also be liable for all federal income tax not withheld, all Social Security taxes not withheld and unemployment tax insurance of 6.2 percent.