Misclassification audits are not exotic. State labor agencies, the IRS, and private plaintiffs all run them, and the consequences land on both sides — back taxes, penalties, benefits liability, and unemployment insurance assessments for the company; personal tax exposure and reclassification risk for the contractor. The audit doesn't ask whether a contract was signed. The audit asks what the working relationship actually looks like. Most freelancers think the contract is the protection. The contract is necessary, but it is not sufficient. The IRS test is a substance-over-form test: a freelancer who signs an Independent Contractor Agreement but operates as a de facto employee — set hours, single client, employer-provided equipment, day-to-day supervision — is at risk of reclassification regardless of what the contract says. The protection is the combination of two things: a contract that says the relationship is independent contractor, and a working pattern that backs it up. Both pieces matter.…