J. Michael Joly and Bonnie B. Joly, Jody Steven Joly, and David Andrew Joly - Page 8

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          3101, 3111.  Petitioners maintain that none of the amounts paid             
          to or on behalf of Michael and Jody constitute employee wages.              
          They argue that respondent's treatment of portions of such                  
          amounts as employee wages is arbitrary.                                     
               Section 3121(d) provides that the term "employee" means:               
                    (1) any officer of a corporation; or                              
                    (2) any individual who, under usual common law                    
               rules applicable in determining the employer-employee                  
               relationship, has the status of an employee; * * *                     
               We first consider whether Michael and Jody provided services           
          to the corporation as employees under common-law rules.                     
          Nationwide Mut. Ins. Co. v. Darden, 503 U.S. 318, 322-325 (1992).           
          Whether an individual is a common-law employee is a question of             
          fact.  Weber v. Commissioner, 103 T.C. 378, 386 (1994), affd. per           
          curiam 60 F.3d 1104 (4th Cir. 1995).                                        
               Among the relevant factors to be considered in deciding the            
          nature of the employer-employee relationship 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 hired party's role in hiring and paying           
          assistants; (4) the permanency of the relationship between the              
          parties to the relationship; (5) the extent of the hired party's            
          discretion over when and how long to work; (6) whether the work             
          performed is an integral part of the principal's business; (7)              
          the relationship the parties believe they are creating; and (8)             
          the provision of benefits typical of those provided to employees.           




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