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workers, route distributors,11 and outside sales workers as
independent contractors.12
B. Conclusion
In Erickson v. Commissioner, 172 Bankr. 900, 913 (Bankr. D.
Minn. 1994), the court noted:
The essence of the safe harbor provision is to
grant protection to the taxpayer who has consistently
treated workers as independent contractors but has not
been previously challenged by the IRS. In effect,
where the taxpayer’s filings have put the IRS on notice
and the IRS has not acted without delay, the taxpayer
must be shielded from the compounding effects of the
error.
In the case before us, petitioner is not in a position to receive
the protections provided by Congress because petitioner did not
satisfy the requirements of section 530(a)(1). We conclude that
petitioner is not entitled to section 530 relief for any of its
bakery workers, cash payroll workers, route distributors, or
outside sales workers.
To reflect the foregoing,
An appropriate order
will be issued.
11 We note that Miller testified that he was aware of
regulations that provided that the route distributors should be
categorized as employees.
12 We note that Miller testified that he knew that the
conversion of the workers from employees to independent
contractors was not done correctly and that “it would screw up
the issue for payroll taxes”.
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