Statutory Employees

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Roger Mies

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Jun 15, 2022, 3:29:20 PM6/15/22
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I have a question.  What makes a person a statutory employee?  I have looked in the BB (chapter 2.11.01), but it only shows four categories.  I believe there should be more.   I have a client who is a business manager.  She travels to several businesses to assist them, and works from home and at the businesses.  I also, have clients who are optometrist, and they work at several sites.  Would these types of workers be self-employed (1099-NEC), or W-2 as a statutory employee, or just a regular W-2 employee.
One of the optometrists filed a SS-8 with the IRS, and the IRS has now come back and said the optometrist is an employee.  BUT, are they a statutory employee??

Need your feedback on this situation.  ASAP.

Thanks in advance,


Roger A Mies, T.P.

millerdbm

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Jun 15, 2022, 3:38:50 PM6/15/22
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From your description both look like Sch C sole proprietors.  My experience with the SS-8 is that they always classify everyone as an employee.

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Lee Reams

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Jun 15, 2022, 3:39:31 PM6/15/22
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What you see in that chapter is the IRC Sec 3121list of statutory employees.  Sorry there are no others.  The one you describe are not statutory employees.  Sorry.
If your clients are in business for them themselves serving multiple clients or patients then they are self employed. You  need to provide more info…

Lee

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Roger Mies

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Jun 15, 2022, 3:44:33 PM6/15/22
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I have the SS-8 Determination Analysis from the IRS, and they say all the optometrists are and should have always been employees.  I believe the company is stuck with this.  BUT, can these employees be statutory???  This is my Big Question....
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Diana Skocypec

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Jun 15, 2022, 3:51:40 PM6/15/22
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The W2 would be coded for a statutory employee designation  
and the employer would need to make the designation. Most often it is salespeople who travel extensively and pay all their own expenses so that they can file a Sch C for the expenses.
There can be restrictions on participation in employer sponsored pension plans if the designation is made. Irs.gov is a good starting point for what conditions need to be met.

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Lee Reams

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Jun 15, 2022, 3:53:03 PM6/15/22
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Roger,

That can’t be true…My optometrist has a store front, employees, and hundreds of customers. He definitely is not an employee. I need more details about your optometrist. But if he works for one employer and  services that employer’s clients then he is an employee.  Assuming your client filled out the SS-4 good chance ne may have filled it out incorrectly.  Beside it is the employer who makes the determination of employee or IC.  Need more info….Lee
 

Diana Skocypec

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Jun 15, 2022, 4:03:40 PM6/15/22
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Roger Mies

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Jun 15, 2022, 4:07:02 PM6/15/22
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Lee,

Thanks for your words of wisdom.  Here is a little more information.  My optometrist works for several companies.  The companies supply the office space, the patients, and the equipment.  Optometrist supplies license, insurance, some of their own patients, some of their own equipment, and their time.   Optometrist sets his or her own schedule, not the company.

Hope this helps,

Roger A Mies, T.P.

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Lee Reams

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Jun 15, 2022, 4:08:21 PM6/15/22
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Do the companies give him a 1099 or a W-2?


 

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Roger Mies

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Jun 15, 2022, 4:10:19 PM6/15/22
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1099, but the IRS says it should be a W-2.
Sent: Wednesday, June 15, 2022 1:08 PM
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