By Orlando Monteagudo | Monte Tax Advisory | September 20, 2026
The Florida Department of Revenue (FDOR) is not the agency it was five years ago. It has moved its filing platform to a new system in stages since 2025[3], it receives outside data and compares it with what you report[10][11], and it says it prefers to audit electronic records[1]. For business owners, audits are increasingly driven by data mismatches rather than chance.
This post covers what has changed, what FDOR itself says about how audits are selected and conducted, and what I would do now to prepare. Every fact below comes from FDOR’s public publications or published commentary by Florida tax practitioners, and each is cited.
A New Filing System, Rolled Out in Stages
FDOR has been moving taxes onto a new eServices File and Pay system in phases. Gross receipts tax and use tax on out-of-state purchases moved on April 1, 2025, and sales and use tax followed on December 1, 2025[3]. The final phase, reemployment tax, took effect on August 24, 2026[3][4]. The old reemployment tax login page is no longer available for filing or payment[3].
One deadline matters right now. The Department did not transfer filing history to the new system. For reemployment tax, prior returns remain viewable in the old system through September 30, 2026, after which access is disabled[4]. Employers may also request copies at any time using Form DR-841[4]. If you have not saved your prior RT-6 history, do it this week.
A modern platform does not select you for audit by itself. But FDOR lists taxpayer filing data and filing behavior, including anomalies, as a source of audit leads[1], so clean and consistent filings matter more than ever.
Reemployment Tax Audits: How You Get Selected
Reemployment tax is Florida’s version of state unemployment tax, paid by employers on the first $7,000 of each employee’s annual wages[6]. FDOR audits it as required by the U.S. Department of Labor and reviews about 1% of active contributing employer accounts each year[1]. Selection is not random. FDOR’s own brochure lists these lead sources: filing data anomalies, statistics on industry, size and location, federal data, third-party data, information-sharing programs with other states and state agencies, reemployment assistance claims, and collection items[1].
Practitioners add detail. One Florida tax attorney reports that the Department cross-references Form 1099 data against quarterly RT-6 reports, flags sharp payroll drops, and follows up when a former worker’s unemployment claim shows wages that were never reported[8]. Business owners often underestimate these audits because the initial assessment looks small next to a sales tax bill[8]. As the next sections show, the assessment itself is often not the real risk.
The 1099 vs. W-2 Focus
Worker classification is the core issue in most reemployment tax audits. Practitioners describe the auditor’s primary mission as determining whether your independent contractors should legally be employees[13], and some industries draw sweeps; attorneys report an industry-wide audit campaign in home health care, for example[14].
FDOR’s guidance on the standard is clear. Chapter 443, Florida Statutes, applies the common law rules and looks at ten factors of the working relationship[5]. The central question is control: an employee is subject to the employer’s will and control over what work is done and how, while a contractor is controlled only as to results[7]. FDOR says how the worker is actually treated, not a written contract or a Form 1099, determines status[7]. It also warns that intentional misclassification of a worker is a felony[5].
Classification problems can also surface from the worker’s side. FDOR notes that a benefits claim by someone never included on your quarterly report delays benefit payments[5], and attorneys report that such claims can grow into full audits[14].
The Federal Ripple Effect
A state reclassification rarely stays at the state level. Florida attorneys warn that reemployment tax audit findings may be shared with the IRS and other agencies, and that reclassifying workers can raise federal questions about income tax withholding, Social Security, Medicare and payroll reporting[8][9]. FDOR’s brochure confirms that federal data and information-sharing programs are among its lead sources[1]. One attorney notes the Florida assessment can even be zero, for example when a reclassified worker’s other wages already exceeded the $7,000 cap, yet the finding can still open the door to a larger federal exam[8].
The 5.4% Rate Trap
FDOR’s brochure states that failing to produce all requested work records results in the loss of your earned tax rate and assignment of the standard rate, 5.4%, until the quarter following your production of the records[1]. On the $7,000 wage base[6], that is up to $378 per employee per year. For a business with a large payroll, that adds up quickly, and it stems from missing records rather than any finding of wrongdoing.
The same brochure says that when a discrepancy is found, the audit may be extended year by year until the discrepancy no longer exists, up to a maximum of five years[1]. Note the wording on the rate: it is tied to record production, so delivering the records promptly is what ends the penalty rate.
Sales and Use Tax: A Data-Driven, Deadline-Driven Process
FDOR publishes the sales and use tax audit path[2]. A Notice of Intent to Audit Books and Records (Form DR-840) starts a 60-day notice period, which you may waive by signing the form[2]. The audit typically looks back three years, or longer if you did not file or filed substantially incorrect returns[2]. FDOR generally must issue a Notice of Proposed Assessment within 305 days of sending the DR-840[2]. You have 30 days to agree or disagree with the Notice of Intent to Make Audit Changes (DR-1215), and after the Notice of Proposed Assessment you have 60 days to file an informal protest or 120 days for a formal one[2]. If you keep records electronically, Florida law requires you to make them available electronically[2].
Technology shows up on the selection side. Florida practitioners report that FDOR receives Form 1099-K data from payment card companies and compares it with the sales on your returns[10]. A 2026 defense guide says the Department uses software to compare DR-15 sales tax returns against other financial information, and that unusually large or frequent refund requests draw scrutiny[11]. Restaurants, salons and used car dealers are reported targets, with comparisons said to include 1099-Ks, alcohol purchase volumes, register summaries, third-party delivery data and, for dealers, vehicle title data from the Department of Highway Safety and Motor Vehicles[12]. Attorneys also warn that if records are not provided, the Department can estimate sales using industry averages, leaving you to prove the right number[15].
Finally, the same FDOR auditors often perform both reemployment and sales tax audits, so a records request in one area can lead to the other[13].
What I Would Do Now
- Save your history. Download prior reemployment tax returns before September 30, 2026, or request copies with Form DR-841[4].
- Reconcile your 1099-Ks. Compare annual 1099-K totals to reported sales, remembering they usually are not reduced for refunds and include sales tax and tips[10].
- Test every 1099 payee. Walk each one through the ten factors, focusing on control. A contract label will not decide the outcome[5][7].
- Organize your records. Maintain payroll records as Rule 73B-10.032, F.A.C., requires[1], and keep sales tax records for three years[16].
- Know your deadlines. Calendar the 30-day response window on audit change notices[1][2], and file Form DR-835 if you want a representative to speak with the auditor[1][2].
- Get help early. Involve a qualified professional as soon as a DR-840 or RT-FL06F arrives[2].
Bottom Line
FDOR’s new technology and data matching do not change the law. They change how quickly gaps between your filings and outside data come to light. Businesses that reconcile their numbers, classify workers carefully, and keep organized electronic records are best positioned when a notice arrives. If you are facing an audit, or want a readiness review before one arrives, contact Monte Tax Advisory through this site.
About the Author
Orlando Monteagudo has more than 30 years of accounting and auditing experience. He began as an audit manager at Deloitte & Touche LLP, founded and ran a mortgage company for 16 years, and later worked as a Florida Department of Revenue tax auditor and an Internal Revenue Agent with the U.S. Department of the Treasury. He holds a B.B.A. in Accounting from the University of Miami and is bilingual in English and Spanish. He founded Monte Tax Advisory to help Florida businesses prepare for, respond to, and recover from sales and use tax and reemployment tax audits.
Keywords
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Disclaimer: This article is provided for general informational purposes only, is based on publicly available information, and does not constitute legal, tax, or accounting advice.