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Can I sue or file some kind of claim against my former employer? California

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  • Can I sue or file some kind of claim against my former employer? California

    My former employer was illegally giving 1099`s to me and other employees. We ended up having to pay the taxes for about 3 years but we did not know that what the company was doing was illegal. Can I or all of us sue or file some kind of claim with the IRS for taxes we paid and for social security benefits that were not withheld?

    Thanks.

  • #2
    I have no idea how a suit would work, but the income taxes you paid would be no less if you were an employee at the same annual income. So the company would have zero liability for federal or state income taxes. It will owe, assuming you were incorrectly classified as an indepedent contractor, its share of FICA. You would still have to kick in your share. Then there are the unemployment taxes that, in most states, are paid only by the employer. Assuming you are in one of those states, the employer owes that.

    Bottom line is that you may have paid in 7.65% of your income for FICA that should have been paid by the employer and they should cough up that money to you.
    Senior Professional in Human Resources and Certified Staffing Professional with over 30 years experience. Any advice provided is based upon experience and education, but does not constitute legal advice.

    Comment


    • #3
      So should the state be reimbursed the unemployement insurance that the employer did not pay for the 1099`s that we were given?

      I have contacted the IRS about this matter, Do they automatically contact the state tax department or do I have to do that?

      Thanks for any help.

      Comment


      • #4
        Hard to say. The federal and state governments are supposed to talk among themselves about such things, but that may be as much a threat to keep people honest as an actual policy. The traditional way of a misclassified worker to get UI in play is to file for it. That forces the state to review the worker classification.

        Just a thought. While I agree with everything Scott says about who owes what taxes, I am going to suggest that there is a possibility that a small claims action for the interest and penalties only associated with the employer not doing what they were legally required to do might be successful.
        "Reality is that which, when you stop believing in it, doesn't go away".
        Philip K. **** (1928-1982)

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