Barium & Chemicals, Inc. - Page 5

                                        - 5 -                                         
          her compensation.  In petitioner’s books and records, E. Naylor             
          treated Exley’s compensation payments and the employer’s share of           
          Social Security taxes as increased loans to A. Pavlik.  A. Pavlik           
          withheld Federal income taxes and Social Security taxes                     
          attributable to Exley’s compensation.  A. Pavlik also secured               
          Federal tax deposit coupons under petitioner’s employer                     
          identification number and petitioner’s corporate name.  In order            
          to make the employment tax deposits, A. Pavlik used the address             
          of his personal residence on the Federal tax deposit coupons.               
               A. Pavlik provided Exley with time cards to record the hours           
          that she worked, and he provided her with pay stubs.  He also               
          provided her with Forms W-2, Wage and Tax Statement, for 1993               
          through 1999.  The Forms W-2 reported the Federal income tax, the           
          Social Security tax, and the Medicare tax withheld for Exley.               
          The time cards, pay stubs, and Forms W-2 were slightly different            
          than the system maintained by E. Naylor for petitioner’s other              
               Because E. Naylor did not recognize Exley as an employee,              
          Forms 940, Employer’s Federal Unemployment (FUTA) Tax Return, and           
          Forms 941, Employer’s Quarterly Federal Tax Return, as prepared             
          by E. Naylor’s administrative office, did not reflect Exley’s               
          compensation for 1993 through 1999.  The Forms 940 and Forms 941            
          did not show the employment tax liability resulting from Exley’s            
          compensation or the deposits made by A. Pavlik.  No unemployment            

Page:  Previous  1  2  3  4  5  6  7  8  9  10  11  12  13  14  Next

Last modified: May 25, 2011