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discharge, the integration of the drivers into the business, and
the permanency of the relationship override any contrary
characterization contained in the agreement. See sec.
31.3121(d)-1(a)(3), Employment Tax Regs. Accordingly the Court
finds petitioner’s drivers were common law employees during the
periods at issue and, consequently, the payments to them during
these periods constituted wages subject to Federal employment
tax.
II. Whether Petitioner Is Eligible for Act Section 530 Relief
Petitioner contends it is entitled to relief pursuant to act
section 530. Congress enacted act section 530 to alleviate what
it perceived as the “‘overly zealous pursuit and assessment of
taxes and penalties against employers who had, in good faith,
misclassified their employees as independent contractors.’”
Ewens & Miller, Inc. v. Commissioner, supra at 276-277 (quoting
Boles Trucking, Inc. v. United States, 77 F.3d 236, 239 (8th Cir.
1996)). Act section 530(a)(1) shields a taxpayer who has
mistakenly not classified his workers as employees from
employment tax liability if the taxpayer had a reasonable basis
for not treating the workers as employees and has filed all
required Federal employment tax returns on a basis consistent
with this treatment. Petitioner never treated the drivers as
employees and consistently issued them Forms 1099-MISC. The
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