IRS VCSP Explained | Fix 1099 vs W-2 Mistakes & Reduce Payroll Penalties

Misclassifying 1099 contractors as employees can snowball into IRS audits, payroll tax debt, and costly penalties. But the IRS Voluntary Classification Settlement Program (VCSP) gives business owners a rare second chance.

In this episode of Full Throttle Finance™, Felicia and Alli explain how the VCSP works and why it matters for small businesses, race teams, and contractors:

✅ The IRS rules for 1099 vs. W-2 classification
✅ Real-world examples across motorsports, construction, and hospitality
✅ How the VCSP reduces liability to 10% of last year’s contractor pay
✅ Step-by-step eligibility and how to apply (Form 8952)
✅ Why correcting worker misclassification protects your business from audits and lawsuits

📌 New episodes drop every Friday. Follow along for payroll strategies, tax credits, small business finance, and motorsport money management.