Morgan Lewis lawyers bring “inside the Beltway” experience to payroll tax, employee/executive fringe benefit, and contingent workforce issues. With an emphasis on planning and controversy work, we help clients develop tax minimization plans, conduct compliance reviews, and settle tax audits. A number of our team members have prior regulatory and litigation experience with the US Department of the Treasury and Internal Revenue Service. Our tax litigators have tried several cases of first impression involving these areas.
Our clients range from startups to Fortune 500 companies. The American Payroll Association and various US federal agencies also call on us to assist with payroll tax and fringe benefit issues—matters that affect both rank-and-file employees and senior executives. Considering recent legislative initiatives, developments within the Treasury Department, and the IRS’s increasing audit activity, we closely monitor and respond to fringe benefit, payroll tax, and contingent workforce issues that may impact our clients.
As part of our comprehensive client service, we conduct compliance checks that aim to minimize the effect of IRS audits and increase reliance on statutory and regulatory relief provisions. Our lawyers work to decrease tax exposure while limiting our clients’ costs and administrative efforts.
In our compliance checks and audit defense work, we often spot payroll tax refunds that companies were not aware they could recoup. We have successfully obtained numerous multimillion-dollar refund claims for Federal Insurance Contributions Act (FICA) tax overpayments.
Our ML BeneHelp program recognizes that our employee benefits clients often need an extra pair of hands due to a variety of circumstances—both unforeseen and expected. Through ML BeneHelp, our senior benefits advisors are available for in-person or virtual temporary assignment to assist during crunch times (we expect these assignments would last no more than six months). These professional advisors, many of whom have more than 20 years of experience and have varied backgrounds that include working for corporate human resources/benefits departments, consulting firms, and other law firms (and some are nonpracticing lawyers), bring unique and substantial technical knowledge and practical experience to our benefits practice and clients.
The types of projects ML BeneHelp can assist with include, but are not limited to, the following:
Our senior benefits advisors regularly perform these services and others for health and welfare and retirement plans. They are available to be dedicated to your projects—whether from the client’s offices, remotely, or a combination thereof.
ML BeneHelp services are priced in a variety of ways, including on a fixed-fee basis, which account for the scope of work and whether the senior benefits advisors are working at the client’s location or remotely from their Morgan Lewis offices (or some combination thereof).
Our executive and nonexecutive fringe benefits practitioners advise on the exclusion, substantiation, valuation, and deduction of the following fringe benefits:
We also counsel on the following employee-related benefits:
Our team further advises clients on the following executive fringe benefits and related regulations:
As IRS National Office and US Department of the Treasury officials, two of our partners helped create, interpret, and administer safe harbors and administrative relief provisions for federal payroll/employment taxes (FICA, FUTA, RRTA, and FITW). When facing IRS payroll tax, fringe benefits, and independent contractor audits, our clients benefit from our lawyers’ substantive and historical knowledge of these provisions, which affect virtually every corporation, executive, and employee in the United States.
Our team helps clients obtain payroll tax relief on worker reclassification, employer-provided cell phones, flights on company-provided aircraft, golden parachute payments, statutory stock options, and next-day payroll tax deposits, among others. We assist with responses to document requests from IRS examining agents, protests filed with the IRS Office of Appeals, and postappeals mediation. We help our clients to settle on favorable terms, but when that is not possible, our litigators represent clients through the ensuing process.
We regularly advise and counsel on the following payroll tax and information-reporting issues:
Working across the firm, we collaborate with our independent contractor initiative colleagues to provide counsel on the many tax and employee benefits aspects associated with contingent workforce and independent contractor planning, compliance, and audits.
As evidenced by independent contractor audit activity and Form SS-8 filings, the IRS considers independent contractor, employee leasing, and other contingent workforce relationships as part of its integrated approach to addressing fringe benefit and payroll tax issues. With this in mind, our lawyers advise clients on the following contingent workforce and independent contractor issues:
Drawing on government and private-sector experience, our lawyers monitor and respond to IRS audit activities before they develop into costly litigation. Our practice covers the areas of employee/executive fringe benefits, payroll taxes, and the contingent workforce—all areas that the IRS aggregates in its employment tax audit initiatives. This allows us to respond efficiently to IRS audit efforts while we continue to develop tax planning and refund opportunities for our clients.
Morgan Lewis lawyers aim to achieve an administrative solution for our clients. However, if we cannot resolve an audit issue administratively, our litigators have the technical and government service experience—as well as the firm’s broad tax litigation resources—to deliver the best possible service to our clients.
We anticipate an increase in tax litigation as the IRS devotes more audit resources to our targeted practice areas. To address this growing IRS litigation activity, our lawyers guide clients through all stages of tax controversies. In addition to managing tax audits and IRS Appeals protests, we litigate tax controversies before the US Tax Court, the US Court of Federal Claims, and the US district courts. Our appellate litigators assist on those cases that go to the courts of appeals and US Supreme Court.Our experience includes FICA taxation test cases that involve tipped employees, medical residents, employee stock purchase plans, and the treatment of downsizing payments. We have also achieved significant success at both the trial and appellate levels in cases that cover excise taxation of frequent flier miles, the deductibility of corporate aircraft operating costs, tax withholding on per diem payments, and the payroll taxation and deductibility of stock option compensation.