Veterinary Surgical Consultants, P.C. - Page 12




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          rather than as wages, avoid FICA and FUTA liabilities.  Id. at              
          145-146.  Thus, as in Veterinary Surgical Consultants, P.C. v.              
          Commissioner, supra at 145-146, and Joseph M. Grey Pub.                     
          Accountant, P.C. v. Commissioner, 119 T.C. 121, 128 (2002), we              
          reject any suggestion that petitioner’s passing through of its              
          net income to Sadanaga precludes the finding of an employer-                
          employee relationship between petitioner and Sadanaga.  We                  
          likewise reject as not germane to the question before us                    
          petitioner’s reliance on section 1372, addressing fringe benefits           
          under subtitle A, and the reference to that statute in Durando v.           
          United States, supra at 551.  See Veterinary Surgical                       
          Consultants, P.C. v. Commissioner, supra at 147-148, 150.                   
                    2.  Contentions Regarding Common Law Employment                   
               Petitioner contends that “employee” as used throughout                 
          section 3121(d) must be construed in a manner consistent with its           
          use in section 3121(d)(2), such that the usual common law rules             
          for determining existence of an employer-employee relationship              
          are to be taken into account.  In support of this position,                 
          petitioner quotes the following passage from Tex. Carbonate Co.             
          v. Phinney, 307 F.2d 289, 291-292 (5th Cir. 1962):                          
                    The statutory definition of “employees” as                        
               including officers of a corporation will not be so                     
               construed as to mean that an officer is an employee                    
               per se.  Only such officers as work for it in fact are                 
               to be so included and, in determining whether an                       
               officer is an employee within the meaning of the                       
               statutes the usual employer-employee tests are to be                   
               applied. * * *                                                         





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