Problem: When using a contract employee, a company never knows whether the IRS will later investigate and determine that the "contract employee" is actually a full-time employee, subjecting the company to significant tax penalties.
Solution: Provide clear guidance, from the IRS, as to what is permissible under contract employee regulations. Make this guidance carry the weight of precedent, in any investigative action. Create presumption of innocence, rather than presumption of guilt, if investigation is launched.
Guidance provides certainty for company. Makes hiring easier and less costly. Allows for additional flexibility and nimbleness of employment structures.