IRS Issues New Worker-Classification and Section 530 Guidance in 2025


Companies treat some workers as independent contractors, and the IRS insists that they are really employees. This is an old story, one that often triggers disputes. The IRS generally has many procedural advantages when it comes to tax disputes, but companies have a unique tool when it comes to worker-classification fights. This obscure instrument is called “Section 530.” Used correctly, it can result in companies avoiding employment taxes and penalties for past years, while retaining the ability to treat workers as independent contractors in future years. This article, which builds on several others by the author, explains the existing authorities regarding Section 530 and then analyzes the newest guidance from the IRS in 2025.

Read the full article here.

About Hale E. Sheppard
HALE E. SHEPPARD, Esq. (B.S., M.A., J.D., LL.M., LL.M.T.) is a partner at Eversheds Sutherland.  He defends clients in tax audits, tax appeals, and Tax Court litigation, covering both domestic and international issues.

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