- 9 - $90,000 income reported) and $42,000 (i.e., $132,000 income received minus $90,000 income reported) relating to 1992 and 1994, respectively. III. Employment Status Respondent determined in the notice of deficiency that payments from Western, reported on petitioners’ Schedule C, are wage compensation and the business expenses deducted by petitioners are miscellaneous itemized deductions. Respondent contends that petitioner was an employee of Western because he was an officer who performed substantial services. Petitioner, relying on several contentions that have been rejected in similar circumstances, contends that he was not an employee of Western. Pursuant to section 3121(d)(2), the term “employee” includes any individual who has the status of an employee under the applicable common law rules. Paragraphs (1), (3), and (4) of section 3121(d) delineate “statutory employees”. These individuals are considered employees regardless of their status under the common law. See Joseph M. Grey Pub. Accountant, P.C. v. Commissioner, 119 T.C. 121, 126 (2002). Any officer of a corporation is a statutory employee, if such officer performs substantial services for a corporation and receives remuneration for those services. See Veterinary Surgical Consultants, P.C. v. Commissioner, 117 T.C. 141 (2001), affd. sub nom. Yeagle DrywallPage: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 Next
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