Joseph M. Grey Public Accountant, P.C. - Page 8




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          other individuals who are considered employees regardless of                
          their status under the common law.  Individuals described in                
          those paragraphs are commonly referred to as “statutory”                    
          employees.  One such category of statutory employees consists of            
          officers of corporations.  Sec. 3121(d)(1).  Section 31.3121(d)-            
          1(b), Employment Tax Regs., limits that category as follows:                
                    (b)  Corporate officers.–-Generally, an officer of                
               a corporation is an employee of the corporation.                       
               However, an officer of a corporation who as such does                  
               not perform any services or performs only minor                        
               services and who neither receives nor is entitled to                   
               receive, directly or indirectly, any remuneration is                   
               considered not to be an employee of the corporation.                   
               * * *                                                                  
          Section 31.3306(i)-1(e), Employment Tax Regs., contains a like              
          limitation specifically applicable to the FUTA tax.                         
               B.  Section 530 of the Revenue Act of 1978                             
               Section 530 provides in relevant part as follows:                      
               SEC. 530. CONTROVERSIES INVOLVING WHETHER INDIVIDUALS                  
                         ARE EMPLOYEES FOR PURPOSES OF THE EMPLOYMENT                 
                         TAXES.                                                       
               (a)  Termination of certain employment tax liability--                 
                    (1) In general.–-If–-                                             
                         (A) for purposes of employment taxes, the                    
                    taxpayer did not treat an individual as an                        
                    employee for any period, and                                      
                         (B) in the case of periods after December 31,                
                    1978, all Federal tax returns (including                          
                    information returns) required to be filed by the                  
                    taxpayer with respect to such individual for such                 
                    period are filed on a basis consistent with the                   
                    taxpayer’s treatment of such individual as not                    
                    being an employee,                                                





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