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dividends instead of reasonable compensation for services they
performed. That revenue ruling held that the “dividends”
constituted wages subject to Federal employment taxes.
In this case, respondent’s position is supported by the plain
language of the statute, the applicable Treasury regulations,
published revenue rulings, and cases interpreting the applicable
statutes. Petitioner’s position is inconsistent with the weight of
authority.
Petitioner argues that Dr. Sadanaga paid the maximum FICA tax
required by law in each year at issue and that respondent is
attempting to assess additional tax on Dr. Sadanaga in the form of
withholding taxes. This argument is simply a “red herring”. For
Federal employment tax purposes, the taxable wage base applies
separately to each employer. Thus, if an employee receives wages
from more than one employer, the annual wage limitation does not
apply to the aggregate compensation received. The employee however
may be eligible for a credit or refund of the excess employee
portion of the FICA tax that applies with respect to wages in
excess of the applicable wage base. Secs. 31.3121(a)(1)-1(a)(3),
31.3306(b)(1)-1(a)(3), Employment Tax Regs.
We have considered all of petitioner’s arguments, and, to the
extent not specifically addressed, we find them unpersuasive or
irrelevant.
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