As an employer, there are three ways to report employee misclassification. As long as you are not under audit, you can use IRS form SS-8 or use the Voluntary Classification Settlement Program, and if you are under audit, you can make your case using the Classification Settlement Program. All of these avenues should reduce the penalties and back tax withholdings you’ll need to pay.
If you’re an employee and want to report a company for misclassification, either of yourself or your colleagues, you can also submit Form SS-8. If you believe the infraction to be willful, you can use Form 3949 to report a failure to pay taxes.