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president,3 they argue that he was an independent contractor with
respect to the medical services he provided to the Association.
Dr. Pariani was an officer of the Association and therefore
an employee under the general rule of section 3121(d)(1).
Although the regulations under section 3121(d) provide an
exception to this general rule, for corporate officers who as
such do not perform more than minor services or receive any
compensation, sec. 31.3121(d)-1(b), Employment Tax Regs., Dr.
Pariani does not qualify for this exception because he performed
substantial services for and received compensation from the
Association.
With respect to the medical services Dr. Pariani provided to
the Association, we look to the common law test incorporated in
section 3121(d)(2). Under the common law test, we examine
numerous factors to decide whether an individual is an
independent contractor or common law employee, among which are
the following: (1) The degree of control exercised by the
principal over the details of the work; (2) which party invests
in the facilities used in the work; (3) the opportunity of the
individual for profit or loss; (4) whether the principal has the
right to discharge the individual; (5) whether the work is part
of the principal's regular business; (6) the permanency of the
3 On brief petitioners characterize the amounts received by
Dr. Pariani with respect to his managerial duties as "wages".
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Last modified: May 25, 2011