Do you pay any of your campground staff as independent contractors? This can quickly become a big problem if the IRS ever takes a look at it.
How do I classify may campground workers as employees or independent contractors?
- Who has financial control of the job?
- Who can exercise behavioral control over how the worker performs the specific task?
- And how do the parties themselves treat the relationship?
When reviewing the checklist, keep in mind that the IRS will make its decision based on the whole picture, not just a single factor.
How will they know that I misclassified campground employees as independent contractors?
What are the consequences for misclassifying campground workers?
- Requirement to pay the back-taxes and interest in employee’s wages (that should have been withheld)
- FICA taxes that were not withheld originally (along with penalties and interest for remitting them late)
- Reimbursement of wages that the business should have paid the worker (if the correct wage and overtime rules had been applied), and any penalty they incur as a result of failing to follow those laws.
- Payment of penalties and benefits for worker’s compensation insurance
Donna Bordeaux, CPA with Campground Accounting
What happens when you send two CPAs out into the relaxing outdoors to camp? You get CampgroundAccounting.com. Donna and Chad have over 50 years of combined experience as entrepreneurial CPAs. They’ve owned businesses and helped business owners exceed their wildest dreams. They camp and travel across the country every chance they get, so it’s just a natural fit that they focus their CPA skills on helping campground owners throughout the USA grow their businesses and minimize the impact of taxes. They understand the key performance indicators and specialized issues that face RV park owners every day.