Businesses want to believe (and indeed are entitled to believe) that an auditor who shows up at their doorstep is open to learning about the business’s specific practices before making a determination as to whether those practices satisfy the applicable independent contractor test. Business owners who have been through audits will tell you, however, that there are times when auditors show up at the door with their minds fully made up.
I recently spoke to an attorney who represented a business in an audit, and the auditor not only started the audit with an explanation of why the business would fail, but went on to list why several industries simply could not past the independent contractor test. The auditor was incorrect in her assessment, but her mindset was indicative of what businesses can sometimes face in an audit.
