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payroll period TLC was obligated to, and did, pay such driver-
employee his or her net wages and any per diem amounts as well as
the employer’s share of employment taxes, withhold and pay the
driver-employee’s share of employment taxes, withhold and pay
Federal and State income taxes, make daily electronic funds
transfers of the appropriate amounts of such taxes to the IRS and
appropriate State agencies, and pay workers’ compensation insur-
ance premiums.
On the record before us, we find that TLC’s tax treatment of
each driver-employee is a factor evidencing that TLC was the
employer of such driver-employee.
Work of Driver-Employee as Part of Regular Business of TLC
Petitioner argues that each driver-employee was “an integral
part of the regular business” of the trucking company client to
which TLC leased such driver-employee and that each driver-
employee played “no role in the daily function of TLC’s business”
of providing “back office functions such as payroll and benefits
administration.”
Respondent counters that, as reflected in the consolidated
tax return (consolidated return) that petitioner filed for each
of the taxable years at issue, the leasing of driver-employees
was TLC’s business, and the deduction that petitioner claimed for
each of the taxable years at issue for TLC’s expenses relating to
the driver-employees was the largest deduction that petitioner
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