Payroll Taxes & Information Reporting

Holding Employers to Higher Reporting Standards

Payroll taxes and withholding represent the single largest source of revenue for the federal government. Social security taxes and related retirement receipts alone amount to 35 percent of total federal receipts. As a result, payroll taxes receive significant Internal Revenue Service (IRS) attention and auditing. In addition, due to a recent IRS hiring initiative, there will be a significant increase in IRS audit activity for the foreseeable future. One of the primary focuses of this increase in audit activity will be “recession proof taxes,” taxes that can be collected even when a company is in a net operating loss position, such as payroll taxes.

Counsel for Challenging Times

Our Payroll Taxes and Information Reporting team is part of our nationally recognized Employee Benefits practice. Our lawyers are regarded as foremost authorities in guiding employers through the intricate rules governing payroll taxes. They bring outstanding benefits and tax knowledge, senior government experience, and a reputation for resolving tough issues.

Our highly experienced team helps clients minimize payroll taxes, develop refund strategies, manage the audit and compliance process, and negotiate favorable administrative solutions. Our lawyers have a successful track record helping clients achieve their business goals through regulatory and legislative channels. We complement these capabilities with our extensive knowledge of executive compensation issues, our experience handling the most complex tax issues, and our ability to litigate a matter if we cannot reach a satisfactory administrative solution.

Among other issues, our Payroll Taxes and Information Reporting team regularly helps clients navigate:

  • Internal compliance audits;
  • Penalty abatement;
  • Cross-border withholding and information reporting;
  • Form W-2 and Form 1099 reporting;
  • Tip reporting;
  • Payroll tax aspects of mergers, acquisitions, and reorganizations, including FICA re-start issues and the appointment of agents to handle payroll tax responsibilities;
  • Payroll tax and reporting obligations regarding executive perks and compensation, including stock option reporting and withholding;
  • State withholding and reporting issues;
  • Independent contractor agreements;
  • Employee benefits communications;
  • Federal privacy requirements for health plans;
  • Co-employee arrangements; and
  • Worker reclassification issues and audits (application of the Section 530 Relief, CSPs, etc.)

Go-To Counsel for Resolving Complex Issues: Audits, Administrative Solutions, and Controversy

We routinely achieve extraordinary outcomes for clients at every stage of the IRS administrative process. Because of our long-standing relationships within the IRS, Treasury, and Labor Departments, we are particularly effective at resolving matters quickly and favorably, before they become costly problems to our clients.

We excel in negotiating down penalties at both the federal and state levels, having successfully reduced proposed penalties in the hundreds of millions of dollars. We are adept at dealing with a range of risky issues, including those raised during an audit, and we have extensive experience handling voluntary disclosures.

In addition, we are a valuable resource for our clients’ internal accounting and tax compliance teams, whether it is answering a complex withholding or reporting question or assisting in developing internal administrative procedures to satisfy tax compliance obligations.

Formidable Litigation Resources

We believe in exploring all relevant options to help our clients avoid the costs and public scrutiny of litigation. However, when litigation is necessary, our clients choose Miller & Chevalier because they know we will defend them vigorously and persuasively. They know we have successfully litigated many tax matters involving multi-million dollar amounts. We combine our technical proficiency with our practical experience to reach the optimal solution.

Representative Engagements|View All
  • Assisted a large financial institution in internal restructuring in order to avoid the FICA re-start provisions (and therefore reduce the company’s out-of-pocket employment tax costs), while at the same time addressing the company’s concerns regarding its internal payroll tax administration.
  • Advised numerous high-tech and other companies on reporting, employment tax, and Internal Revenue Code Section 162(m) deduction consequences of issuing discounted options (due to option misdating or option backdating), including ways to correct the discount and, in some cases, the mechanics of IRS and California FTB compliance programs. After advising with respect to correction of the option discount, successfully defended the advised correction in IRS audit of employment tax consequences of correction.
  • Represented a large manufacturing company in protesting a large employment tax deposit penalty. Penalty was abated at IRS Appeals.
Government Experience
Corporate Experience
Rankings and Recognition
  • Chambers USA: Tax Team of the Year, 2016
  • Chambers USA: Employee Benefits & Executive Compensation Team of the Year, 2015
  • Legal 500: Employee Benefits & Executive Compensation Team of the Year (U.S.), 2015
  • Chambers USA: Employee Benefits & Executive Compensation (National), 2015 - 2016
  • Chambers USA: ERISA Litigation (National), 2015 - 2016
  • Chambers USA: Employee Benefits & Executive Compensation (District of Columbia), 2008 - 2016
  • Chambers USA: Tax: Controversy (National), 2007 - 2016
  • Chambers USA: Tax (District of Columbia), 2003 - 2016
  • Legal 500: Labor & Employment: Employee Benefits & Executive Compensation (U.S.), 2010 - 2016
  • Legal 500: Tax: Non-Contentious (U.S.), 2013 - 2016
  • Legal 500: Tax: International Tax (U.S.), 2013 - 2016
  • Legal 500: Tax: Contentious (U.S.), 2007 - 2016
  • U.S. News -- Best Lawyers® "Best Law Firms": Employee Benefits (ERISA) Law (National), 2013 - 2016
  • U.S. News -- Best Lawyers® "Best Law Firms": Employee Benefits (ERISA) Law (District of Columbia), 2010 - 2016
  • U.S. News -- Best Lawyers® "Best Law Firms": Tax Law (National), 2010 - 2016
  • U.S. News -- Best Lawyers® "Best Law Firms": Tax Law (District of Columbia), 2010 - 2016
  • International Tax Review "Americas Tax Awards": Americas Tax Policy Firm of the Year, 2012 - 2013, 2015 - 2016 
  • International Tax Review "Americas Tax Awards": Washington, DC Tax Firm of the Year, 2013
  • International Tax Review "Americas Tax Awards": Washington, DC Transfer Pricing Firm of the Year, 2012
  • International Tax Review: World Tax (Washington, DC), 2012, 2014 - 2017
  • International Tax Review: World Transfer Pricing (National), 2014 - 2017