US Treasury SS-8 Determination of Worker Status for Purposes of Federal Employment Tax

In my dealings with the US Treasury Department regarding worker classification disputes I have learned that although in reality there may be shades of gray distinguishing between what constitutes an employee and what constitutes an independent contractor the US Treasury has some very specific positions.  Here are four that will hopefully help you make the…

Details

IRS And the Trust Fund Recovery Penalty (TFRP) for Employment Tax Delinquencies

Here are 5 things I learned through experience regarding TFRP: 1. An IRS Revenue Officer makes a determination to “assess” or “not assess” the Trust Fund Recovery Penalty (TFRP). Bankruptcy does not stop the Assessment Statute even though it can stop the Collection effort. One of the major reasons why an IRS Revenue Officer won’t…

Details

Protective Tax Refund Claim

Protective refund claims are filed to preserve a taxpayer’s right to claim a refund when the taxpayer’s right to the refund is contingent on future events like future litigation, and may not be determinable until after the statute of limitations expires. Without a protective refund claim, taxpayers will only have a three-year statute of limitations in which to seek a refund. For example as…

Details

Personal Service Corporations (PSC) – the Sub Chapter S Election and Wages/Employment Taxes

As I have blogged before a Personal Service Corporation can indeed elect Sub Chapter ‘S’ corporate status and be treated as a disregarded entity for income tax purposes.  This requires the filing of IRS form 1120-S, not IRS form 1120. However if you are successfully (ie profitably) operating a personal service corporation structured as a…

Details

New Form for Employees Misclassified as Independent Contracts

IRS Form 8919, Uncollected Social Security and Medicare Tax on Wages, may be used if you were an employee and your employer did not withhold your share these taxes and you meet certain criteria. These taxes will then be credited to you social security records. Generally, a worker who received a Form 1099 for services provided…

Details