Monday, April 20, 2015

How Illinois Companies Should Protest the IDES Notice of Determination and AssessmentArising Out of An IDES Audit



April 2015
By: Nancy E. Joerg, Esq.
 
When an Illinois company is audited by the Illinois Department of Employment Security ("IDES"), the IDES auditor may find that the audited company unfortunately owes money to the IDES.  This is of course bad news.  The company who was audited had been hoping that the IDES auditor would find nothing wrong. 

When a company is found, upon IDES audit, to have MISCLASSIFIED "independent contractors", money will be owed to the IDES.  This is because the company should have paid into the IDES on these misclassified individuals.  The IDES auditor does not tell the audited company how much it will owe the IDES.  No, the IDES auditor merely advises the audited company (at the conclusion of the audit) that in a few weeks’ time, the actual tax bill will come.  It is called the “Notice of Determination and Assessment". 

TAX BILL: The Notice of Determination and Assessment is a tax bill by the IDES (to the company who has been audited).  It tells the company exactly how much money is now owed to the IDES.  It also shows interest and penalties owed.  Interest can be surprisingly hefty---at the shocking rate of 24% per year!!

SIMPLE PROTEST FORM: The best advice is usually to protest the Notice of Determination and Assessment.  There is a simple protest form.  It only requires a few well-chosen sentences as to why you don't agree with the auditor's findings. 

IF PROTEST IS LATE, YOU LOSE ALL RIGHTS TO APPEAL: The most important part of the protest process is to fax it ON TIME to the IDES!  If the protest is even one day late, the protest is no good.  You have lost all rights of appeal!

So....be sure that you protest within twenty (20) days of the date of mailing of the Notice of Determination and Assessment (sometimes called the "D & A" for short). 

Remember---don't delay protesting when the D & A arrives in the mail!!  If you blow the strict twenty day deadline for protesting, the D & A becomes “final, due and owing”!

NOTICE OF HEARING: Once you have protested timely, you will eventually get a Notice of Hearing in the mail.  Now you have a valuable opportunity to participate in a hearing (to decide if the auditor was right or wrong about your supposed misclassification of your independent contractors and many other related issues).


For assistance with IDES audits, hearings, and independent contractor agreements (or for consultations on limiting your liability in the use of independent contractors), contact Attorney Nancy E. Joerg, who enjoys a nationwide reputation in working with companies who use Independent Contractors of all types. Nancy Joerg can be reached at Wessels Sherman's St. Charles, Illinois office: 630-377-1554 or email her at najoerg@wesselssherman.com.