Irs Announces New Voluntary Worker Classification Settlement Program Vcsp
This is part of a larger “Fresh Start” initiative at the IRS to help taxpayers and businesses to address their tax responsibilities for which employers face no deadline. IRS Commissioner Doug Shulman. The brand-new Voluntary Classification Settlement Program (VCSP) is designed to increase tax conformity and reduce burden for employers by giving better certainty for employers, workers, and the government. Under the scheduled program, eligible employers can obtain substantial relief from federal payroll taxes they could have owed for the past, if they prospectively treat employees as employees.
The VCSP is open to many businesses, tax-exempt organizations, and authorities entities that currently erroneously treat their employees or a course or band of workers as nonemployees or 3rd party contractors, and want to correctly treat these workers as employees now. Interested employers can make an application for the scheduled program by filing Form 8952, Application for Voluntary Classification Settlement Program, at least 60 days before they want to begin to treat the employees as employees. Employers accepted into the program will pay an amount effectively equaling just over one percent of the wages paid to the reclassified employees for days gone by year.
No interest or fines will be credited, and the employers shall not be audited on payroll taxes related to these employees for prior years. Participating employers shall, for the first 3 years under the scheduled program, be at the mercy of a special six-year statute of limitations, rather than the usual three years that generally apply to payroll … Read the rest
