We partnered with benchmark commercial insurance to discuss how audits relate to workers’ compensation. Benchmark offers a boutique approach to serving their clients through providing and maintaining commercial and personal insurance policies. Their goal is to establish comprehensive risk management and accident-avoidance programs to help prevent claims from arising. Get… [Read more]
California CPA’s: Questions to ask your Clients to Reduce EDD Audit Risk
Certified Public Accountants (CPAs) have the most insight into their business owner clients’ daily transactional history. You may find that your clients who have 1099 contractors are now in the grey area of worker classification since it was redefined by AB-5 in January 2020. Under the new bill, all workers… [Read more]
What Will 2021 EDD Audits Look Like?
Watch our video below to learn how the last 12 quarters affect your EDD audit criteria. Have You Received an EDD Audit Letter? The California Employment Development Department (EDD) sends audit letters through the mail. If you receive an audit letter, you have 30 days to reply. Typically, the agency… [Read more]
How Dynamex Ruined it for Everybody
Who is Dynamex and what did they do? Watch our video below: Dynamex was a nationwide same-day delivery and courier service. They employed their California drivers as W-2 employees who received the benefits, payroll taxes, and perks of being a W-2 employee. However, in 2004, the company reclassified all… [Read more]
What to expect in an EDD Audit?
If your business is experiencing an EDD audit, it’s important to know what to expect. Founder and managing attorney at Milikowsky Tax Law, John Milikowsky, breaks down the EDD audit process and the frequently asked questions that come with an EDD audit. “What you can expect from us, whether you… [Read more]
Vince B. EDD Audit Case Study
We are grateful to our client, Vince B., for sharing his story of how we were able to help him weather an EDD audit. This audit could have closed his business and had far-reaching repercussions for his personal finances as well as business finances. In 2020, Vince was hit with… [Read more]
The Difference Between EDD and CSLB Audits
Employment Development Department (EDD) and California Contractors State License Board (CSLB) audits both expose your business to fines and penalties if the agency finds you noncompliant with the strict regulations and policies they have in place for classifying 1099 independent contractors. Both CSLB and EDD perform site sweeps that can… [Read more]
Right of Control: Who has it and How Does EDD Determine 1099 Status?
When determining whether your workers should be classified as employees or independent contractors, it’s critical to ensure that you are closely following the Employment Development Department’s (EDD) strict guidelines. On the simplest level, proper classification is determined by whether or not the principal, or employer, holds the “right of control.”… [Read more]
EDD Audits: A Cautionary Tale
No one wants to find themselves under audit. Whether from IRS, EDD CFTB, or other government agencies, audits are stressful and time-consuming. When it comes to facing an audit, how you react at the start of the audit can make all the difference. Some business owners feel that it is… [Read more]
How to Minimize the Risk of an EDD Audit?
Need to review 1099 classification criteria? CLICK HERE: How do you minimize the risk of an EDD Audit? There is no way to eliminate the risk of a government agency audit, audits are performed on a number of criteria, from a site sweep in which contractors are randomly audited by… [Read more]