117 T.C. No. 14
UNITED STATES TAX COURT
VETERINARY SURGICAL CONSULTANTS, P.C., Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 2500-99. Filed October 15, 2001.
P, an S corporation, distributed all of its net
income to A, its sole shareholder and president. A
performs substantial services for P. On his Forms 1040,
A reported P’s net income as nonpassive income from an S
corporation.
R issued to P a Notice of Determination Concerning
Worker Classification Under Sec. 7436, determining that
A was an employee of P for purposes of Federal employment
tax.
Held: A is an employee of P for purposes of Federal
employment tax pursuant to sec. 31.3121(d)-(1)(b),
Employment Tax Regs., because A is an officer who
performs substantial services for P and receives
remuneration for those services.
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