Afrexai Payroll Audit

# Payroll Compliance Auditor

Run a full payroll audit in under 10 minutes. Catches the errors that cost companies $845 per violation.

## What It Does
- Classifies workers (W-2 vs 1099) using the IRS 20-factor test
- Audits overtime calculations against FLSA rules
- Checks tax withholding accuracy (federal, state, local)
- Flags misclassification risk with dollar-amount exposure estimates
- Generates quarterly compliance checklists
- Produces audit-ready reports for DOL or state agency reviews

## How to Use

Tell your agent:

**Full payroll audit:**
"Run a payroll compliance audit for [company]. We have [X] employees across [states]. Pay frequency is [weekly/biweekly/monthly]."

**Worker classification check:**
"Check if these roles should be W-2 or 1099: [list roles with descriptions]."

**Overtime audit:**
"Audit overtime compliance. Our employees work [schedule]. We're in [state]. Current OT policy: [describe]."

**Tax withholding review:**
"Review tax withholding setup for employees in [states]. We use [payroll provider]."

## Audit Framework

### 1. Worker Classification (IRS 20-Factor Test)
Score each worker across three categories:
- **Behavioral Control** (6 factors): Instructions, training, integration, personal services, hiring assistants, work hours
- **Financial Control** (5 factors): Business expenses, investment, profit/loss opportunity, market availability, method of payment
- **Relationship Type** (4 factors): Written contracts, benefits, permanency, key services

**Risk levels:**
- 0-4 factors toward employee → Low risk (likely contractor)
- 5-9 factors → Medium risk (review needed)
- 10+ factors → High risk (likely misclassified)

**Penalty exposure per misclassified worker:**
- Back employment taxes: 15.3% of wages
- FLSA overtime liability: up to 3 years back pay
- Benefits liability: retirement, health, PTO
- IRS penalties: $50-$260 per W-2 failure
- State penalties vary: $5K-$25K per violation (CA, NY, MA highest)

### 2. Overtime Compliance...

# Payroll Compliance Auditor

Run a complete payroll audit — worker classification, overtime compliance, tax withholding accuracy, and quarterly checklists. Catches the mistakes that cost $845 per violation on average.

## Features
- IRS 20-factor worker classification test (W-2 vs 1099)
- FLSA + state-specific overtime rule checking
- Federal and state tax withholding verification
- Misclassification exposure calculator
- Quarterly/annual compliance checklists
- Audit-ready report generation

## Quick Start
Tell your agent: "Run a payroll compliance audit for my company. 50 employees across CA, NY, and TX."

## Who It's For
HR teams, growing companies expanding to new states, contractor-heavy businesses, anyone facing a DOL audit.

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