Despite the recent increase in online commerce, traditional methods of moving product, such as so-called “direct selling,” are alive and well. Indeed, according to a recent IRS study, direct selling is a significant industry, with annual sales of nearly $30 billion and more than 13 million salespersons in the United States alone. The IRS has intensified worker-classification audits over the past few years, generally claiming that workers should be treated as employees instead of independent contractors. Theoretically, these audits should cause little concern for direct sellers because they enjoy a special status under the Internal Revenue Code. The reality, though, is that the IRS’s recent audits have caused problems for many direct sellers, particularly those who fail to appreciate their unique tax status and/or assert their rights. The attached article, called “Direct Sellers Hit by IRS Worker-Classification Audits: An Analysis of the Obscure Rules and Strategies Applicable to These Workers,” is designed to alleviate these problems. The article was published in a recent issue of Taxes – The Tax Magazine.