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unsatisfactory services because the beautician “made the entire
place look bad”. Furthermore, despite the fact that beauticians
could set their own work schedule, petitioner required
beauticians to adjust their schedules to ensure walk-in customers
could be served.
Petitioner argues that the beauticians’ ability to work for
other salons demonstrates a lack of continuity in the employer-
employee relationship. We find this argument without merit. In
Kelly v. Commissioner, T.C. Memo. 1999-140, this Court found that
working for a number of employers during a tax year does not
necessitate treatment as an independent contractor.
After review of the entire record, we find that petitioner
failed to establish that the beauticians in question were
independent contractors. The weight of the evidence leads us to
conclude that the beauticians were petitioner’s employees during
the years at issue.
Section 530 of the Revenue Act of 1978
Section 530 of the Revenue Act of 1978 provides relief for
employers who mistakenly claim their employees as independent
contractors. In other words, even under our finding that the
beauticians were petitioner’s employees during the years at
issue, petitioner may not be liable for the employment taxes if
he falls under the safe harbor of section 530.
In order for petitioner to prevail, he must show the
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