Tax file: IL, IRS eye ICs

Illinois enacted a law in early August to toughen enforcement against construction firms that misclassify employees as independent contractors (ICs). The legislation adds five investigators and an attorney to the Illinois Dept. of Labor. Tom Villanova, president of the Chicago and Cook County Building and Construction Trades Council, called the law the beginning of a statutory process aimed at rooting out all worker misclassification in the Illinois economy.

The same week, the IRS issued a report on steps it intends to take to close the “tax gap” and improve taxpayer compliance. One focus will be small businesses, particularly S corporations.

The trucking industry was not mentioned in either document. However, ICs and S corporations are common in trucking, making the industry susceptible to a higher degree of scrutiny.