This report analyzes the Career Institute of America (CIA), a company specializing in auto industry training, and its current non-profit business structure under Delaware law. The CEO is considering a change to a Limited Liability Company (LLC) for greater flexibility. The report examines key issues, including the costs of the current structure and the classification of workers as independent contractors under the IRS 20 Factor test and the Fair Labor Standards Act. The analysis highlights the advantages of an LLC, such as flexible taxation and management, and emphasizes the importance of clearly defining employment terms to ensure trainers are correctly classified as independent contractors. The report references relevant Delaware law, IRS guidelines, and other legal resources to support its conclusions, offering recommendations for CIA to improve its business structure and employment practices, including specifying contractor responsibilities for taxes and working conditions. The document also includes a comprehensive list of references.
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