Before a workers comp premium audit, pull payroll by person and duty for the whole policy term with overtime on its own line, your quarterly wage reports, and a certificate and license number for every sub you paid. Each state then adds items of its own: hourly rates for California's wage-split classes, signed waivers for Arizona sole proprietors and per-employee payroll for Nevada.
Every Crew Deserves a Crown
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This workers comp audit checklist for contractors is built to print. Work down it with your bookkeeper, put each item in one folder, then add the items for each state your crews worked in. It is about getting ready; if a bill already came back wrong, the how to dispute a workers comp audit guide picks up there.
| Record | What It Shows | What Can Happen Without It |
|---|---|---|
| Payroll register | Who was paid, how much and when they started or left | The auditor may work from tax filings alone |
| Duty notes | Which published classification the carrier may apply to each person | Pay for a mixed role may be placed in the field classification |
| Overtime line | The premium portion California lets a carrier leave out | In California, overtime may be counted in full |
| Sub certificates and licenses | That each sub carried its own coverage while it worked | Payments to that sub are often added to your payroll |
| Arizona agreements and waivers | That the carrier received the paper the statute ties to no premium | Those payments may be treated like any sub without proof |
| Nevada insurer statements | That a sub's project premiums were paid | The principal contractor may stay answerable for that crew |
Hand over source records, not a summary made for the visit. In California, Insurance Code 11760 makes a knowingly false statement that bears on premium unlawful.
California. On policies that begin on or after September 1, 2026, wage-split construction trades divide payroll between two classifications by each person's regular hourly rate, so totals alone won't do; each pair's threshold is listed in dual wage workers comp California. A covered officer, partner or member is reported within $66,300 to $171,600 a year.
Arizona. A fully completed agreement under Arizona Revised Statutes 23-902(D), once your carrier has it, bars premium on what you pay that contractor, absent proof that rebuts it, and a sole proprietor's waiver, signed with your carrier under Arizona Revised Statutes 23-961(N), relieves you of coverage and premium for that person. For workers the carrier calls statutory employees, 23-961(M) requires written findings first. For the tests behind both papers, see Arizona independent contractor agreement for workers comp.
Nevada. The payroll counted for each employee is capped at a figure tied to the policy date: $98,433.60 for policies from October 1, 2026 to December 31, 2026, and $102,452.16 from January 1, 2027, a cap you can apply person by person with the Nevada industrial insurance payroll limit tool. For a finished project, Nevada Revised Statutes 616B.645 lets you request a final certificate from a sub's insurer, which relieves you of further premium for that project.
Write to the carrier with what is missing and when you expect it, and send what you have. In California, under Insurance Code 11760.1, an employer that withholds access after the third request during at least a 90-day period may be charged three times the insurer's current annual estimate plus audit costs. Access runs through the policy and within three years after the policy period ends, and the premium is revised if the audit is later completed.
Waiting for the Third Letter
Setting the audit letter aside until the busy season ends moves the carrier closer to estimating without your records, and in California that estimate can run far above your own. Answer the first request, even if only to set a date.
The kit sits with the payroll limit calculator and the sub certificate list among the free workers comp tools.
Send your trade, state and payroll, and a broker reviews the request. If you would rather talk first, leave a number.
Swipe or use the arrows for every answer.
Typically payroll by person for the policy term, the duties behind it, overtime shown separately, quarterly wage filings, owner details, and a certificate and license number for each sub you paid.
At least as long as the insurer can ask for them. Insurance Code 11760.1 gives the insurer access during the policy period and within three years after the policy period ends, and lets it charge three times its current annual estimate if access is refused after repeated requests. Tax and payroll rules may call for longer.
Ask the sub now for a certificate or policy information showing coverage for the work dates, and bring it with the invoices. Without it, those payments may be counted as your payroll under each state's sub rules.
Send pay for each employee, not one total. The counted payroll per person stops at $98,433.60 on policies from October 1, 2026 to December 31, 2026, and at $102,452.16 from January 1, 2027. Owners follow separate rules.
Yes. Print it with the button under the core kit, mark your states and hand it over. Most items come from payroll and accounting records; the duty notes, owner list and sub file need your input.
10 official sources
Reviewed by David Gleason, Principal, on .
Next Level Experience. Insurance Done Right.
A folder ready before the auditor calls keeps the audit about your real payroll.
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