The IRS and state taxing agencies are auditing yoga studios and wellness businesses over the use of independent contractors. New York and California are targeting specifically the yoga community. If you are audited and you have misclassified your teachers as independent contractors, you may be liable for heavy back taxes, fees and penalties. Some studios have been put out of business.
The burden is on you to prove that your teachers and other workers are independent contractors. Many states view the use of independent contractors as abusive.
Do you know the difference between and independent contractor and an employee and have you properly classified your teachers and other workers? Do you know the federal and state laws that determine true independent contractors? Have you changed your business practices to follow these laws and are these documented in a professional agreement? Do you have a state of the art independent contractor agreement? Are you in the strongest position to “make your case” if you are audited?
Converting Independent Contractors to Employees
Many studios are converting their independent contractors into employees because they no longer wish to face the risk of an audit. This book contains a new chapter that explains how to manage the conversion process. It contains a 24 item checklist and extensive resources.
There are over 180 federal laws that regulate employees and every state has its own system of laws. Do you know the laws that govern the interviewing, hiring, managing and termination process? Are you using best practices for hiring and firing employees? Are you using professional employment agreements? Do you know how to convert your teachers from independent contractors to employees if you chose to do so?
This is a full color, 200 page PDF book. It includes 10 legal agreements (including model agreements for independent contractors and employees) and many other resources.