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requirements of section 3121(d)(3)(C) because she did not receive
materials or goods from ALS.
Neither the code nor regulations provide guidance on the
meaning of “materials” or “goods”. Yet, materials are typically
the “tools or apparatus for the performance of a given task”.
See The American Heritage Dictionary of the English Language 1079
(4th ed. 2006). Petitioner was required to use the ALS template
to perform her duties. The ALS template is, therefore, a
material. Because the template falls within the definition of
materials, we need not consider whether it falls within the
definition of goods. As noted before, petitioner was required to
return the template to ALS. Thus, petitioner performed services
on materials or goods furnished by such person, which are
required to be returned to such person. Further, petitioner’s
services were not performed as a single transaction, and
petitioner did not have a substantial investment in the
facilities (i.e., the schools) used in connection with the
performance of the services. Accordingly, petitioner was a “home
worker” within in the meaning of section 3121(d)(3)(C), and
therefore, a statutory employee exempt from self-employment taxes
pursuant to section 1402(c)(2).
We must also determine whether petitioner is liable for the
section 6651(a)(1) addition to tax. Section 6651(a)(1) provides
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Last modified: March 27, 2008