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solicited clients and business on behalf of petitioner, entered
into verbal and written agreements on behalf of petitioner,
oversaw petitioner’s finances, managed petitioner, hired and
fired independent contractors on behalf of petitioner, made
investment decisions on behalf of petitioner, entered into
development projects on behalf of petitioner, and had signatory
authority over petitioner’s bank accounts.
During 1995, petitioner recognized that the following
persons were employees: B.J. Stanfield, office assistant; Brenda
M. Gray, office assistant; and Michael Giaquinto, development
troubleshooting/assistant to Mr. Henderson. Petitioner timely
filed Forms 941, Employer’s Quarterly Federal Tax Return, for
each quarter in 1995 and 1996. Petitioner also timely filed
Forms 940-EZ, Employer’s Annual Federal Unemployment Tax Return,
for both 1995 and 1996.
Petitioner did not issue Forms W-2, Wage and Tax Statement,
or Forms 1099-MISC, Miscellaneous Income, to Mr. Henderson in
1995 or 1996.
During 1995, petitioner paid from its own bank account
$96,766 of Mr. Henderson’s personal expenses. (All dollar
amounts are rounded off in this opinion.) Likewise, during 1996
petitioner paid from its own bank account $143,221 of Mr.
Henderson’s personal expenses.
In the notice of determination, respondent based the FICA
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