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operating expenses. We do not believe that Congress, in enacting
section 3121(b)(20) to help fishing boat owners avoid financial
hardship and employment tax record-keeping requirements, intended
to limit the beneficial effects of section 3121(b)(20) by
conferring self-employment status only on fishing boat crew
members who receive a share of proceeds with no subtraction of
operating expenses. To hold otherwise would classify as
employees a majority of crew members, who, under the lay system,
usually receive a share of proceeds after subtraction of
operating expenses.
Because we are a court with national jurisdiction over
litigation involving the interpretation of the Federal tax
statutes, see Lardas v. Commissioner, 99 T.C. 490 (1992),
adopting petitioners’ interpretation of section 3121(b)(20) would
throw the small boat fishing industry into turmoil and create
financial hardship for the owners.
Assuming as we do that most, if not all, small fishing boat
owners have not filed Forms 940 and 941 to report and pay FUTA
and FICA taxes for fishing boat workers who received proceeds
from sales of catches after subtraction of operating expenses,
the periods of limitation for assessments of those taxes would
not have expired. Secs. 6501(a), 6503(a)(1), 6213. Our adoption
of petitioners’ interpretation of section 3121(b)(20) could be
applied retroactively to assess employment taxes for previous tax
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