Olde Raleigh Realty Corporation - Page 8




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          whether the Secretary’s determination of worker classification is           
          correct and to determine the amount of employment taxes,                    
          additions to tax, and penalties provided by Chapter 68 of                   
          Subtitle F (sections 6651 through 6751).  Ewens & Miller, Inc. v.           
          Commissioner, 117 T.C. 263, 267-268 (2001).                                 
               Sections 3111 and 3301 impose FICA and FUTA taxes on                   
          employers for wages paid to their employees.  Wages for FICA and            
          FUTA purposes are defined as “all remuneration for employment,              
          including the cash value of all remuneration (including benefits)           
          paid in any medium other than cash” with exceptions not                     
          applicable in this case.  Secs. 3121(a), 3306(b).  Generally, the           
          form of payment is immaterial.  Secs. 31.3121(a)-1(c) and (d),              
          31.3306(b)-1(b), (e), Employment Tax Regs.  Payment can be made             
          in cash or something other than cash.  Secs. 31.3121(a)-1(c) and            
          (d), 31.3306(b)-1(b), (e), Employment Tax Regs.  Thus, “an                  
          officer who performs substantial services for a corporation and             
          who receives remuneration in any form for those services is                 
          considered an employee whose wages are subject to Federal                   
          employment taxes.”  Veterinary Surgical Consultants, P.C. v.                
          Commissioner, 117 T.C. 141, 145 (2001).                                     
               Petitioner sought to prove the existence of an oral                    
          agreement between the corporation represented by its president,             
          Mr. Henderson, and its sole shareholder, Mr. Henderson.  In                 
          essence, petitioner seeks to prove an oral agreement by Mr.                 






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