employee versus contractor - which form?

[Catherine]

Hi all --

A client wants to amend her 2006 return; she was paid as a contractor but was really an employee. I tried at that time to get her to file the right paperwork to contest the 1099, but she didn't want to annoy her boss. Well, now the (former) boss has annoyed _her_, and she could really use the return of the half of OASDI that she paid unnecessarily.

So of course I can't for the life of me find the right form to use for 2006. Sigh. I've searched on this forum but didn't use the right term, and I've searched the forms list in ATX and no luck there either.

I know it's 8919 starting in 2007, but I need the one for 2006. Help, please!

Catherine

[jainen]

>>it's 8919 starting in 2007, but I need the one for 2006<<

Before they produced Form 8919, the IRS instructions were to use Form 4137, crossing out the word "tips" and substituting "wages." It was awkward at best, and seems even more so with an amended return. If you decide to file this way, use the instructions for 8919 as a guideline to make a strong claim. File an SS-8, and prepare to defend the position with time sheets, job descriptions, and other normal records of an employee and co-workers.

Most employee classification is done on the state level, so consider filing a complaint with the labor board instead.

[Catherine]

>>it's 8919 starting in 2007, but I need the one for 2006<<

Before they produced Form 8919, the IRS instructions were to use Form 4137, crossing out the word "tips" and substituting "wages." It was awkward at best, and seems even more so with an amended return. If you decide to file this way, use the instructions for 8919 as a guideline to make a strong claim. File an SS-8, and prepare to defend the position with time sheets, job descriptions, and other normal records of an employee and co-workers.

Most employee classification is done on the state level, so consider filing a complaint with the labor board instead.

THANK YOU, jainen. I went all through the 4XXX-series forms listing and missed it.

Massachusetts is actually _much_ stricter than the Feds on the employee/contractor rules, so she'll win hands-down. But she still wants the overpaid OASDI back. And I have the notes etc for form SS-8 still in her folder from '06. Three cheers for electronic storage!

Catherine

[Virtual Managed Solutions]

Hip Hip Hooray, Hip Hip Hooray, Hip Hip VMSUS all the way!

[jainen]

>>she'll win hands-down<<

Don't jump to conclusions. You can expect the employer to fight it big time, and they may have something you don't know about. Also, winning on the much stricter state level won't by itself get her SE tax back, because the IRS makes a separate determination under its own criteria.

[Catherine]

>>she'll win hands-down<<

Don't jump to conclusions. You can expect the employer to fight it big time, and they may have something you don't know about. Also, winning on the much stricter state level won't by itself get her SE tax back, because the IRS makes a separate determination under its own criteria.

Massachusetts has been having a huge crackdown on businesses calling employees contractors _and_ their rules are significantly stricter than the Federal rules, so as far as the state goes, she'll win hands down. That's what I was referring to.

As for the Federal, I've been through the checklist, and she was clearly an employee. Client worked in retail store. Boss set hourly wages, hours to be worked each week, how work was to be done, how staff was to dress, all equipment/supplies were provided by store owner, no sales commissions were paid -- it was pretty cut-and-dried. Which was why I urged her back in '06 to file the SS-8.

Catherine

[jainen]

>>it was pretty cut-and-dried<<

Interesting phrase. I think it originated with apothecaries who sold dried herbs as well as fresh. The savvy shopper, of course, would want to turn the bunch over to see if the other side was as well-prepared, and that is what you should do with this case.

You haven't heard the response yet. Maybe the store already has a ruling for a different employee. Maybe it has a work contract, real or forged. Maybe it just has some mysterious power over your client. Maybe it's just lots of luck in an unfair world.