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Roger
Roger, Lawyer
Category: Employment Law
Satisfied Customers: 31787
Experience:  BV Rated by Martindale-Hubbell; SuperLawyer rating by Thompson-Reuters
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I sold my business a couple of years ago. We have around 40

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I sold my business a couple of years ago. We have around 40 employees and one part time accounting contractor (who happened to be married to the CFO). She was paid as a contractor. After the sales, the company was investigated by the California EDD and it was determined that she should have paid as an employee and that the state needed to be paid $5,000. This came out of escrow. My question is, will this information go to the IRS and what is the likelihood that I will have to pay out additional monies?
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please see if you can find someone. it is a simple question with probably a simple answer..

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Hi - my name is XXXXX XXXXX I'm a litigation attorney. Thanks for your question.

As you know, employment taxes consist of federal income tax withholding along with Social Security and Medicare taxes and unemployment taxes. These taxes are all in addition to state withholding requirements.

Thus, it is very likely that the IRS will contact your business regarding this as well, and the taxes, fines and penalties could be assessed as well for federal taxes.

It is very likely that the IRS will be notified by the Ca. EDD.

Roger, Lawyer
Category: Employment Law
Satisfied Customers: 31787
Experience: BV Rated by Martindale-Hubbell; SuperLawyer rating by Thompson-Reuters
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