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NAPEO Urges IRS To Reverse Liability Policy

| 1/9/2024

NAPEO President and CEO Casey M. Clark today called on the IRS to follow congressional intent and reverse its recent payroll tax liability policy that holds professional employer organizations (PEOs) liable for tax information provided by their clients.  

The new policy, outlined in a December memo, holds aggregate filers like PEOs solely responsible for any payroll tax credits taken by their clients, which is at odds with a 2021 congressional directive regarding tax credits.  

In a letter to IRS Commissioner Daniel Werfel, Clark said, “(T)he only outcome that makes sense from a fairness and tax administration standpoint is for the client employer to be held responsible for any errors and improper claims resulting from the information provided by the client to its CPEO or PEO.” 

To read NAPEO’s full letter to the IRS, click here.