More of our Recent Audit/Appeal Results!

Mercer Law PLLC is pleased to share some of its success stories representing clients in independent contractor matters before state and federal agencies — i.e. Department of Labor & Industries (L&I) and Employment Security Department (ESD) — over the past few months.  These cases have been selected to show the variety and types of cases the firm handles for our clients. Names and specific business information have been withheld for client confidentiality.

  • 89 percent reduction in tax assessment. An Everett business was assessed tens of thousands of dollars in back taxes, penalties, and interest after an auditor determined that the firm was deficient in its recordkeeping, and had 1099 workers who failed to qualify as exempt independent contractors. Mercer Law represented the business on appeal and established the accuracy of the firm’s recordkeeping, and obtained reversal of other portions of the auditor’s decision, resulting in an 89 percent reduction in the assessed amount.
  • Successful audit representation. The client was a Bellevue tech company with workers who had been mistakenly classified as independent contractors, and who did not meet requirements for independent contractors under Washington law. Mercer Law represented the company in an audit, and obtained a favorable audit result for the company. The company ended up paying minimal amounts in back taxes, penalties or interest.
  • 48 percent reduction in L&I tax assessment. An Eastern Washington business was assessed nearly six figures in back taxes, penalties, and interest after an auditor determined that 1099 workers for the firm failed to qualify as independent contractors. Counsel for the firm contacted Mercer Law to assist with the appeal. On appeal, Mercer law assisted in obtaining a 48 percent reduction in the assessed amount.
  • 46 percent reduction in L&I tax assessment.  An Eastern Washington construction company was assessed nearly six figures in back taxes, penalties, and interest after an auditor determined, among other things, that 1099 workers for the firm failed to qualify as independent contractors. The auditor then assigned default risk classifications to the workers, thereby significantly increasing the taxes that were owed. Mercer Law represented the business on appeal and obtained reversal of the risk classification determination, and other determinations by the auditor, resulting in a 46 percent reduction in the assessed amount. Mercer Law then assisted with obtaining a favorable payment plan for the business.
  • Successful ESD audit representation. Mercer Law represented a Seattle-area construction company that, unfortunately, was faced with an ESD audit less than a year after going through an L&I audit. Mercer Law represented the company in the audit, and guided the company to a very favorable audit result.
  • 75 percent reduction in L&I tax assessment. An island construction company was assessed tens of thousands of back taxes, penalties, and interest after an auditor determined, among other things, that 1099 workers for the firm failed to qualify as independent contractors. Mercer Law represented the business on appeal and, among other things, obtained a determination that workers were in fact 1099 workers, thus resulting in a 75 percent reduction in the assessed amount.
  •  44 percent reduction in L&I tax assessment. A Seattle-area landscape company was assessed back taxes, penalties, and interest after an auditor determined, among other things, that the firm was deficient in its record-keeping, and had 1099 workers who failed to qualify as independent contractors.  After an effort to appeal on its own, the firm contacted Mercer Law to assist with the appeal. Mercer Law represented the business on appeal and obtained a 44 percent reduction in the assessed amount.
  • Workers’ Compensation Coverage Determination. Mercer  Law successfully represented a Seattle-area company in L&I’s new Workers’ Compensation Coverage Determination Program. The program offers businesses a way to obtain a formal opinion from L&I regarding whether Washington law requires them to pay workers’ compensation premiums on workers designated as independent contractors.

More of our results are available here and here

Please note that Mercer Law PLLC cannot guarantee a given result or outcome for any case. These matters are highly fact-specific, and the results for each case cited above should not be relied upon as a guarantee or promise of similar results. Each case, therefore, must be evaluated by the relevant facts, circumstances, and law with its own individual outcome.

For more information on how to comply with independent contractor obligations, consult with an experienced independent contractor law attorney, and check out 1099 Review™, a Mercer Law PLLC product, and Washington’s State’s first online independent contractor risk assessment tool and resource center.

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