This article covers the general process and important issues that we see come up in the course of California’s Employment Development Department tax audits, with a focus on the employment misclassification audits of businesses that utilise the services of independent contractors. Substantive legal analysis of California’s independent contractor laws is not part of this content.
A General Overview of an Audit by the EDD in California
The EDD audit process will always begin with a notice from the EDD. Oftentimes, this notice will come along with a list of documents or information being requested, a questionnaire, and a general description of the audit process.