- 19 -
Id. at 519-522. In deciding that the individuals qualified as
employees under either rubric, the court did not repudiate the
statutory treatment of corporate executives. Id. at 520, 522;
see also Joseph M. Grey Pub. Accountant, P.C. v. Commissioner,
supra at 129 n.5.
Moreover, even if we were to assume arguendo that the cited
cases could offer a reasonable basis for treating an officer as a
nonemployee, petitioner has failed to establish reliance on the
claimed precedent as a factual matter. To fall within the safe
harbors of Section 530(a)(2), the taxpayer must have relied on
the alleged authority during the periods in issue, at the time
the employment decisions were being made. The statute does not
countenance ex post facto justification. See 303 W. 42nd St.
Enters., Inc. v. IRS, 181 F.3d 272, 277, 279 (2d Cir. 1999)
(reversing and remanding because it was “unclear from the record
whether * * * [the taxpayer] in fact relied on any specific
industry practice in reaching its decision to treat its * * *
[workers] as non-employee tenants, let alone whether such
reliance was reasonable”); Select Rehab, Inc. v. United States,
205 F. Supp. 2d 376, 380 (M.D. Pa. 2002) (“The taxpayer must show
that it relied upon those grounds [alleged as a reasonable
basis], and that the reliance was reasonable.”); W. Va. Pers.
Servs., Inc. v. United States, 78 AFTR 2d 96-6600, at 96-6608,
96-2 USTC par. 50,554, at 85,919 (S.D. W. Va. 1996) (“The plain
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