Aloha, I operate spa business in Hawaii. I have an issue and also would answers to some of my questions as well.
I have been operating spa for last 5 years in Hawaii. The issue is related to payment to spa therapists, whether to pay them as independent contractors or as employees and I realize that they should and MUST have been paid as employees. To make the wrong right, I wish to file form 8952 for IRS (attached) and henceforth be 100% compliant. Slowly but steadily I have successfully converted about 28 independent contractors into employees and with another 7 more to get converted.
My questions are:
1. I am doing this for 2012, with this, will the IRS come back asking for more money for 2011 and other preceding years?
2. Upto how many years of back taxes can they ask?
[url removed, login to view] questions for Hawaii state.
4. I am now filing yearly taxes as S coprporation but basically the company is an LLC, which is 100% owned by a corporation in the British Virgin [url removed, login to view] tem # 10 to 14 on the form 8952, should I fill in the BVIs company details?
5. What is the best way to protect myself from further back taxes, penalties, interests etc?
Thanks and regards