§530 — Coverdell education savings accounts
104 cases·46 followed·14 distinguished·2 questioned·3 criticized·1 limited·1 overruled·37 cited—44% support
Statute Text — 26 U.S.C. §530
A Coverdell education savings account shall be exempt from taxation under this subtitle. Notwithstanding the preceding sentence, the Coverdell education savings account shall be subject to the taxes imposed by section 511 (relating to imposition of tax on unrelated business income of charitable organizations).
For purposes of this section—
The term “Coverdell education savings account” means a trust created or organized in the United States exclusively for the purpose of paying the qualified education expenses of an individual who is the designated beneficiary of the trust (and designated as a Coverdell education savings account at the time created or organized), but only if the written governing instrument creating the trust meets the following requirements:
No contribution will be accepted—
unless it is in cash,
after the date on which such beneficiary attains age 18, or
except in the case of rollover contributions, if such contribution would result in aggregate contributions for the taxable year exceeding $2,000.
The trustee is a bank (as defined in section 408(n)) or another person who demonstrates to the satisfaction of the Secretary that the manner in which that person will administer the trust will be consistent with the requirements of this section or who has so demonstrated with respect to any individual retirement plan.
No part of the trust assets will be invested in life insurance contracts.
The assets of the trust shall not be commingled with other property except in a common trust fund or common investment fund.
Except as provided in subsection (d)(7), any balance to the credit of the designated beneficiary on the date on which the beneficiary attains age 30 shall be distributed within 30 days after such date to the beneficiary or, if the beneficiary dies before attaining age 30, shall be distributed within 30 days after the date of death of such beneficiary.
The age limitations in subparagraphs (A)(ii) and (E), and paragraphs (5) and (6) of subsection (d), shall not apply to any designated beneficiary with special needs (as determined under regulations prescribed by the Secretary).
The term “qualified education expenses” means—
qualified higher education expenses (as defined in section 529(e)(3)), and
qualified elementary and secondary education expenses (as defined in paragraph (3)).
Such term shall include any contribution to a qualified tuition program (as defined in section 529(b)) on behalf of the designated beneficiary (as defined in section 529(e)(1)); but there shall be no increase in the investment in the contract for purposes of applying section 72 by reason of any portion of such contribution which is not includible in gross income by reason of subsection (d)(2).
The term “qualified elementary and secondary education expenses” means—
expenses for tuition, fees, academic tutoring, special needs services in the case of a special needs beneficiary, books, supplies, and other equipment which are incurred in connection with the enrollment or attendance of the designated beneficiary of the trust as an elementary or secondary school student at a public, private, or religious school,
expenses for room and board, uniforms, transportation, and supplementary items and services (including extended day programs) which are required or provided by a public, private, or religious school in connection with such enrollment or attendance, and
expenses for the purchase of any computer technology or equipment or Internet access and related services, if such technology, equipment, or services are to be used by the beneficiary and the beneficiary’s family during any of the years the beneficiary is in school.
Clause (iii) shall not include expenses for computer software designed for sports, games, or hobbies unless the software is predominantly educational in nature.
The term “school” means any school which provides elementary education or secondary education (kindergarten through grade 12), as determined under State law.
The term “computer technology or equipment” means computer software (as defined by section 197(e)(3)(B)), computer or peripheral equipment (as defined by section 168(i)(2)(B)), and fiber optic cable related to computer use.
An individual shall be deemed to have made a contribution to an education individual retirement account on the last day of the preceding taxable year if the contribution is made on account of such taxable year and is made not later than the time prescribed by law for filing the return for such taxable year (not including extensions thereof).
In the case of a contributor who is an individual, the maximum amount the contributor could otherwise make to an account under this section shall be reduced by an amount which bears the same ratio to such maximum amount as—
the excess of—
the contributor’s modified adjusted gross income for such taxable year, over
$95,000 ($190,000 in the case of a joint return), bears to
$15,000 ($30,000 in the case of a joint return).
For purposes of paragraph (1), the term “modified adjusted gross income” means the adjusted gross income of the taxpayer for the taxable year increased by any amount excluded from gross income under section 911, 931, or 933.
Any distribution shall be includible in the gross income of the distributee in the manner as provided in section 72.
No amount shall be includible in gross income under paragraph (1) if the qualified education expenses of the designated beneficiary during the taxable year are not less than the aggregate distributions during the taxable year.
If such aggregate distributions exceed such expenses during the taxable year, the amount otherwise includible in gross income under paragraph (1) shall be reduced by the amount which bears the same ratio to the amount which would be includible in gross income under paragraph (1) (without regard to this subparagraph) as the qualified education expenses bear to such aggregate distributions.
For purposes of subparagraph (A)—
The total amount of qualified education expenses with respect to an individual for the taxable year shall be reduced—
as provided in section 25A(g)(2), and
by the amount of such expenses which were taken into account in determining the credit allowed to the taxpayer or any other person under section 25A.
If, with respect to an individual for any taxable year—
the aggregate distributions during such year to which subparagraph (A) and section 529(c)(3)(B) apply, exceed
the total amount of qualified education expenses (after the application of clause (i)) for such year,
the taxpayer shall allocate such expenses among such distributions for purposes of determining the amount of the exclusion under subparagraph (A) and section 529(c)(3)(B).
No deduction, credit, or exclusion shall be allowed to the taxpayer under any other section of this chapter for any qualified education expenses to the extent taken into account in determining the amount of the exclusion under this paragraph.
Rules similar to the rules of paragraphs (2), (4), and (5) of section 529(c) shall apply for purposes of this section.
The tax imposed by this chapter for any taxable year on any taxpayer who receives a payment or distribution from a Coverdell education savings account which is includible in gross income shall be increased by 10 percent of the amount which is so includible.
Subparagraph (A) shall not apply if the payment or distribution is—
made to a beneficiary (or to the estate of the designated beneficiary) on or after the death of the designated beneficiary,
attributable to the designated beneficiary’s being disabled (within the meaning of section 72(m)(7)),
made on account of a scholarship, allowance, or payment described in section 25A(g)(2) received by the designated beneficiary to the extent the amount of the payment or distribution does not exceed the amount of the scholarship, allowance, or payment,
made on account of the attendance of the designated beneficiary at the United States Military Academy, the United States Naval Academy, the United States Air Force Academy, the United States Coast Guard Academy, or the United States Merchant Marine Academy, to the extent that the amount of the payment or distribution does not exceed the costs of advanced education (as defined by
section 2005(e)(3) of title 10
, United States Code, as in effect on the date of the enactment of this section) attributable to such attendance, or
an amount which is includible in gross income solely by application of paragraph (2)(C)(i)(II) for the taxable year.
Subparagraph (A) shall not apply to the distribution of any contribution made during a taxable year on behalf of the designated beneficiary if—
such distribution is made before the first day of the sixth month of the taxable year following the taxable year, and
such distribution is accompanied by the amount of net income attributable to such excess contribution.
Any net income described in clause (ii) shall be included in gross income for the taxable year in which such excess contribution was made.
Paragraph (1) shall not apply to any amount paid or distributed from a Coverdell education savings account to the extent that the amount received is paid, not later than the 60th day after the date of such payment or distribution, into another Coverdell education savings account for the benefit of the same beneficiary or a member of the family (within the meaning of section 529(e)(2)) of such beneficiary who has not attained age 30 as of such date. The preceding sentence shall not apply to any payment or distribution if it applied to any prior payment or distribution during the 12-month period ending on the date of the payment or distribution.
Any change in the beneficiary of a Coverdell education savings account shall not be treated as a distribution for purposes of paragraph (1) if the new beneficiary is a member of the family (as so defined) of the old beneficiary and has not attained age 30 as of the date of such change.
Rules similar to the rules of paragraphs (7) and (8) of section 220(f) shall apply. In applying the preceding sentence, members of the family (as so defined) of the designated beneficiary shall be treated in the same manner as the spouse under such paragraph (8).
In any case in which a distribution is required under subsection (b)(1)(E), any balance to the credit of a designated beneficiary as of the close of the 30-day period referred to in such subsection for making such distribution shall be deemed distributed at the close of such period.
For purposes of this section, the term “rollover contribution” includes a contribution to a Coverdell education savings account made before the end of the 1-year period beginning on the date on which the contributor receives an amount under
section 1477 of title 10
, United States Code, or
section 1967 of title 38
of such Code, with respect to a person, to the extent that such contribution does not exceed—
the sum of the amounts received during such period by such contributor under such sections with respect to such person, reduced by
the amounts so received which were contributed to a Roth IRA under section 408A(e)(2) or to another Coverdell education savings account.
The last sentence of paragraph (5) shall not apply with respect to amounts treated as a rollover by subparagraph (A).
For purposes of applying section 72 in the case of a distribution which is includible in gross income under paragraph (1), the amount treated as a rollover by reason of subparagraph (A) shall be treated as investment in the contract.
Rules similar to the rules of paragraphs (2) and (4) of section 408(e) shall apply to any Coverdell education savings account.
This section shall be applied without regard to any community property laws.
For purposes of this section, a custodial account shall be treated as a trust if the assets of such account are held by a bank (as defined in section 408(n)) or another person who demonstrates, to the satisfaction of the Secretary, that the manner in which he will administer the account will be consistent with the requirements of this section, and if the custodial account would, except for the fact that it is not a trust, constitute an account described in subsection (b)(1). For purposes of this title, in the case of a custodial account treated as a trust by reason of the preceding sentence, the custodian of such account shall be treated as the trustee thereof.
The trustee of a Coverdell education savings account shall make such reports regarding such account to the Secretary and to the beneficiary of the account with respect to contributions, distributions, and such other matters as the Secretary may require. The reports required by this subsection shall be filed at such time and in such manner and furnished to such individuals at such time and in such manner as may be required.
104 Citing Cases
Unlike issuance of a Notice of Deficiency for deficiency jurisdiction, issuance of a Notice of Determination is not a threshold requirement under section 7436; the requirement is only that the Commissioner made a determination of worker classification or with respect to RA 1978 section 530 relief.
Even ifthe IRS were to fail to issue a 90-day letter upon the conclusion ofthis audit, the taxpayer would still be entitled to resolve this dispute in Tax Court, because "It - 11 - [*11] is the determination [that Section 530 does not apply], not the piece ofpaper, that provides a basis for ourjurisdiction."6 The Tax Court, in interpreting Section 530, has concluded that the statute does not require the existence ofany dispute as to whether the workers were employees versus independent contract
530 is inapplicable when R does not make a determination ofworker classification.
530 is inapplicable when R does not make a determination ofworker classification.
530 reliefis unavailable. See Joseph M. Grey Pub. Accountant, P.C. v. Commissioner, 119 T.C. 121, 131-132 (2002) (holding that sec. 530 reliefis limited to controversies regarding the employment tax status ofservice providers under the common law and does not apply with respect to statutory employees, such as corporate officers), affd, 93 Fed.
6(...continued) we need not decide whether, or when, the IRS made a determination for purposes of sec.
However, we need not decide whether Rev.
We disagree with the parties that we lack jurisdiction over 1996 through 1998.
Abraham is an employee of petitioner for employment tax purposes for the periods at issue; (2) whether petitioner is entitled to relief from employment taxes pursuant to section 530 of the Revenue Act of 1978 (Act section 530) with respect to Mr.
Kovacevich was petitioner's employee for Federal employment tax purposes and that petitioner was not entitled to reliefpursuant to section 530 ofthe Revenue Act of 1978.
We hold that the identified individuals were TFT Galveston Portfolio's employees and TFT Galveston Portfolio is liable for the employmenttaxes determined with respect to those individuals; (2) whether, in addition to being liable for employmenttaxes for the fourth quarter oftaxable year 2004, TFT Galveston
We hold that the identified individuals were TFT Galveston Portfolio's employees and TFT Galveston Portfolio is liable for the employmenttaxes determined with respect to those individuals; (2) whether, in addition to being liable for employmenttaxes for the fourth quarter oftaxable year 2004, TFT Galveston
We hold that the identified individuals were TFT Galveston Portfolio's employees and TFT Galveston Portfolio is liable for the employmenttaxes determined with respect to those individuals; (2) whether, in addition to being liable for employmenttaxes for the fourth quarter oftaxable year 2004, TFT Galveston
We hold that the identified individuals were TFT Galveston Portfolio's employees and TFT Galveston Portfolio is liable for the employmenttaxes determined with respect to those individuals; (2) whether, in addition to being liable for employmenttaxes for the fourth quarter oftaxable year 2004, TFT Galveston
We hold that the identified individuals were TFT Galveston Portfolio's employees and TFT Galveston Portfolio is liable for the employmenttaxes determined with respect to those individuals; (2) whether, in addition to being liable for employmenttaxes for the fourth quarter oftaxable year 2004, TFT Galveston
We hold that the identified individuals were TFT Galveston Portfolio's employees and TFT Galveston Portfolio is liable for the employmenttaxes determined with respect to those individuals; (2) whether, in addition to being liable for employmenttaxes for the fourth quarter oftaxable year 2004, TFT Galveston
We hold that the identified individuals were TFT Galveston Portfolio's employees and TFT Galveston Portfolio is liable for the employmenttaxes determined with respect to those individuals; (2) whether, in addition to being liable for employmenttaxes for the fourth quarter oftaxable year 2004, TFT Galveston
We hold that he is not; (9) whether Dr.
Conclusion We hold that the workers listed in the notice ofdetermination were petitioner's employees for tax year 2005 and that he is liable for Federal employmenttaxes as determined by respondent.
Accordingly, we hold that petitioner is not liable for additions to tax pursuant to section 6651(a)(1) or for penalties under section 6656 for the taxable periods at issue.
Accordingly, we hold petitioner is liable for Federal employment taxes, additions to tax, and penalties as determined by respondent.
Conclusión In summary, we hold that (1) Èëtitioner is a pedper party before this dourt, ( ) Donald Cave, the assoaiate attorneys, and Mr.
In view of the foregoing, we hold that the distributions in 1ssue are includable in petitioners' gross income.' We note that the redeposited distributions will increase the basis in each account.
• In General In enumerated circumstances-, act section 530 provides relief from employment taxes notwithstanding that the relationship between the taxpayer and the" individual' performing "services would otherwise require payment of such taxes.
Held: Because P did not treat the physicians as employees for any period, filed all Federal tax returns on a basis consistent with P’s treatment of the physicians as not being employees, and had a reasonable basis for not treating the physicians as employees, P is entitled to relief from employment tax liability pursuant to sec.
Because the safe harbor of section 530 does not provide relief to petitioner, and in accord with our finding above that the beauticians were petitioner’s employees rather than independent contractors, we hold that petitioner is liable for the employment taxes due as stated in the notice of determination.
Accordingly, we hold that Dr.
Therefore, we hold that we do have jurisdiction over additions to tax and penalties found in chapter 68 of subtitle F (sections 6651 through 6751), including deciding the proper amount of such additions to tax and penalties, related to taxes imposed by subtitle C with respect to worker classification or section 530 t
(3) Whether petitioner is eligible for relief pursuant to section 530 of the Revenue Act of 1978, Pub.
- 3 - classification pursuant to section 530 of the Revenue Act of 1978 with respect to such individual(s).
95-600, § 530 (section 530), 92 Stat. 2763, 2885 (as amended); and (3) was therefore liable for federal employment 1 Unless otherwise indicated, all statutory references are to the Internal Revenue Code, Title 26 U.S.C. (I.R.C.), in effect at all relevant times, all regulation references are to the Code of Federal Regulations, Title 26 (Treas. Reg.), in ef
Petitioner argues that, with respect to the substantive consistency requirement for the nurses before and after 2016, the two treatments were not substantially similar because, unlike petitioner’s employees, the nurses could turn down any work assignment and were able to control their work schedules. We do not find that the record persuasively supports this argument. Any “right” the nurses may have had with respect to declining a post-2016 work assignment carried with it potential punitive measu
Section 530 Relief Section 530 may afford a taxpayerrelieffrom employment taxes even ifthe relationship between the taxpayer and the worker would otherwise require payment ofthose taxes. Charlotte's Office Boutique, Inc. v. Commissioner, 121 T.C. 89, 106 (2003), M, 425 F.3d 1203 (9th Cir. 2005). Section 530(a)(1) provides reliefifthe taxpayer satisfies the following requirements: (1) the taxpayerhas not treated the worker as an employee for any period; (2) the taxpayer has consistentlytreated th
Petitioner, then as now, contended that it was not obligated to pay employment taxes with respect to the foreign flight attendants because petitioner was entitled to “section 530 relief”.
determination regarding the classification of the workers is sustained. See Rule 151(e)(4) and (5); Petzoldt v. Commissioner, 92 T.C. 661, 683 (1989). - 4 - (2) whether petitioner is entitled to relief under the Revenue Act of 1978, Pub. L. 95-600, sec. 530, 92 Stat. 2885, as amended (act section 530). FINDINGS OF FACT The parties stipulated some of the facts. The stipulated facts are incorporated herein by this reference. Petitioner’s principal place of business was in Northglenn, Colorado, whe
Felicia Reed, Andrea Trent, Shemeka Morgan, Eric Patrick, Tracey Ashley, and Kathy Wayne (video workers) were employees of Ronald McLean Eastern Video (petitioner) for Federal employment tax purposes during each of the four quarters of the calendar year 1996; and (2) petitioner is not entitled to relief from Federal employment taxes as provided by section 530 of the Revenue Act of 1978, Pub.
Grey was petitioner's employee during the periods in question, and section 530 relief is not available, then the schedule accurately sets forth petitioner's liabilities for Federal employment taxes for those periods. The issues for decision are whether Mr. Grey was petitioner's employee for these purposes and, if so, whether petitioner is entitled to relief under section 530.¹ Unless otherwise indicated, all section references are to the Internal Revenue Code in effect for the taxable periods at
oner a Notice of Determination Concerning Worker Classification under section 7436, in which it was determined that, during the taxable years 1996 and 1997, Dennis Katz was a statutory employee of petitioner and petitioner 1 Except with reference to sec. 530 of the Revenue Act of 1978, Pub. L. 95-600, 92 Stat. 2885, section references are to the Internal Revenue Code applicable to the years in question. - 2 - was not entitled to relief from employment tax liability under section 530 of the Reven
Grey was petitioner’s employee during the periods in question, and section 530 relief is not available, then the schedule accurately sets forth petitioner’s liabilities for Federal employment taxes for those periods.
We have determined that the individual(s) listed or described on the attached schedule are to be legally classified as employees for purposes of federal employment taxes under subtitle C of the Internal Revenue Code and that you are not entitled to relief from this classification pursuant to section 530 of the Revenue Act of 1978 with respect to such individual(s).
As a final matter relating to petitioner’s employment status, we make brief mention of section 530 of the Revenue Act of 1978, Pub.
Rather, petitioners rely on section 530 of the Revenue Act of 1978 (Section 530)5 for their position that Dr.
.................. 64 A. Dr. Alexander Was an Employee ofFountain During the OEL Transaction............................................. 64 1. Employment Status . . . . . . . ... . . . . . . . . . . . . . . . . . . . . . . . . . . 64 2. ReliefUnder Section 530 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66 B. Fountain Is Liable for Employment Taxes With Respect to Dr. Alexander's Services During the Taxable Quarters Ended March 31, 1999, Through December 31, 2003 . . . . . . . .
at 2885, as amended (section 530), which in certain circumstances deems an individual not to be an employee;' (3) whetherpetitioner is liable for the employment taxes in the notice of determination; 'Unless otherwise indicated, all section references are to the Internal Revenue Code of 1986, as amended and in effect for the taxab
Kovacevich was an employee of petitioner for Federal employment tax purposes and petitioner was not entitled, pursuant to section 530 of the Revenue Act of 1978, Pub.
Hernandez, Carlos Ramirez, and Raul Ramirez were employees of petitioner ' s waterproofing business or independent contractors during 2003 ; (2) whether petitioner is entitled to relief under section 530 of the Revenue Act of 1978 , Pub .
Specifically, the Examining Agent concluded that: (1) Petitioner did not qualify for section 530 relief as provided in the Revenue Act of 1978, Pub.
Kovacevich (Kovacevich) was petitioner’s employee for Federal employment tax purposes, (2) petitioner is entitled to relief under section 530 of the Revenue Act of 1978, Pub.
Sadanaga (Sadanaga) was an employee of petitioner for Federal employment tax purposes during 1997 through 1998 and, if so, (2) whether petitioner is entitled to relief under section 530 of the Revenue Act of 1978, Pub.
Graham (Graham) was an employee of petitioner for Federal employment tax purposes during 1995 through 1997 and, if so, (2) whether petitioner is entitled to relief under section 530 of the Revenue Act of 1978, Pub.
Murdock (Murdock) was an employee of petitioner for Federal employment tax purposes during 1995 through 1997 and, if so, (2) whether petitioner is entitled to relief under section 530 of the Revenue Act of 1978, Pub.
Stark (Stark) was an employee of petitioner for Federal employment tax purposes during 1996 through 1998 and, if so, (2) whether petitioner is entitled to relief under section 530 of the Revenue Act of 1978, Pub.
Ridge (Ridge) was an employee of petitioner for Federal employment tax purposes during 1996 through 1998 and, if so, (2) whether petitioner is entitled to relief under section 530 of the Revenue Act of 1978, Pub.
Ludlow (Ludlow) was an employee of petitioner for Federal employment tax purposes during 1996 through 1998 and, if so, (2) whether petitioner is entitled to relief under section 530 of the Revenue Act of 1978, Pub.
s motion to sever and continue determinations of worker classification and proper Federal employment taxes. Consequently, the only issue presently before the Court is whether petitioner is entitled to relief from employment tax liability pursuant to section 530. Unless otherwise indicated, all section references are to the Internal Revenue Code in effect for the year in issue. For convenience, FICA and FUTA taxes are collectively referred to as employment taxes. FINDINGS OF FACT Some of the fact
- 5 - taxes, and (2) petitioner was not entitled to “safe harbor” relief from these taxes as provided by section 530 of the Revenue Act of 1978, Pub.
Sadanaga is an employee of petitioner, and that the payments to him from petitioner are wages subject to Federal employment taxes, Section 530 allows petitioner relief from employment tax liability if two conditions are satisfied.
2763, 2885 (section 530); and (3) whether our jurisdiction to decide the proper amount of employment taxes provides the Court with jurisdiction to decide the proper amount of additions to tax and penalties related to employment tax arising from worker classification or section 530 treatment determinations.
(2) Whether petitioner is eligible for relief provided to employers by section 530 of the Revenue Act of 1978, Pub.
We have determined that the individual(s) listed or described on the attached schedule are to be legally classified as employees for purposes of federal employment taxes under subtitle C of the Internal Revenue Code and that your (sic) are not entitled to relief from this classification pursuant to section 530 of the Revenue Act of 1978 with respect to such individual(s).
To ensure employers comply with these tax obligations, the Internal Revenue Service (IRS) may audit an employer’s return to determine the employment status of individuals performing services for the employer, the availability of section 530 relief,3 and the amount of employment tax due.
To ensure compliance with these tax obligations, the Internal Revenue Service (IRS) may audit an employer to determine the employment status of individuals performing services for the employer, the availability of section 530 relief,2 and the amount of employment tax due.
2763, 2885, as amended, with respect to Mr. Treece’s treatment as an independent contractor. Pursuant to the Stipulation of Settled Issues petitioner owes the following employment taxes: 3 Return Tax period Type of tax Amount of tax form number 3/31/15–12/31/15 941 FICA & FITW $3,738 2015 940 FUTA 420 3/31/16–12/31/16 941 FICA & FI
2763, 2885, as amended, with respect to Mr. Treece’s treatment as an independent contractor. Pursuant to the Stipulation of Settled Issues petitioner owes the following employment taxes: Return Tax period Type of tax Amount of tax form number 3/31/15-12/31/15 941 FICA & FITW $13,278 2015 940 FUTA 420 3/31/16-12/31/16 941 FICA & FITW
at 2885. Respondent also determined that petitioner is liable for employment taxes, penalties under section 6656 for failure to deposit tax, and accuracy-related penalties under section 6662(a) for negligence. Attached to the notice are schedules setting forth petitioner’s liabilities for (1) Federal Insurance Contribution Act (F
Since there’s no evidence that Ward’s work for the firm was as anything other than its officer, (continued...) - 8 - [*8] Section 530 of the Revenue Act of 1978 relieves some firms from liability in situations somewhat like this.
Since there’s no evidence that Ward’s work for the firm was as anything other than its officer, (continued...) - 8 - [*8] Section 530 of the Revenue Act of 1978 relieves some firms from liability in situations somewhat like this.
at 2885, and (3) therefore petitioner was liable for Federal employment taxes of$125,799. The sole issue for decision is whether the individuals listed in the notice ofdetermination should be legally classified as employees as respondent maintains or as independent contractors as petitioner maintains.3 We resolve this issue in pe
at 767, which provides that "[t]he Secretary * * * shall include on each notice ofdeficiency under section 6212 * * * the date determined * * * as the last day on which the taxpayer may file a petition with the Tax Court." And perhaps the most telling instance: The very provisions estab- lishing the Whistleblower Office are f
at 767, which provides that "[t]he Secretary * * * shall include on each notice ofdeficiency under section 6212 * * * the date determined * * * as the last day on which the taxpayer may file a petition with the Tax Court." And perhaps the most telling instance: The very provisions estab- lishing the Whistleblower Office are f
ation by the Secretary as part ofan examination that -- (1) one or more individuals performing services for such person are employees ofsuch person for purposes ofsubtitle C, or (2) such person is not entitled to the treatment under subsection (a) ofsection 530 ofthe Revenue Act of 1978 with respect to such an individual, upon the filing ofan appropriate pleading, the Tax Court may determine whether such a determination by the Secretary is correct and the proper amount ofemployment tax under suc
petitioner argued that Mr. Herndon was an independent contractor, not its employee. Alternatively, petitioner argued that it was entitled to relief under the Revenue Act of 1978, Pub. L. No. 95-600, sec. 530(a), 92 Stat. at 2885, as amended (RA '78 sec. 530 relief). Appeals Officer Stewart (AO Stewart) issued to petitioner a letter dated February 28, 2012, informing it that the appeal ofthe proposed employmenttax liabilities had been assigned to him. Member Brent Hampton, acting on behalfof - 5
N I. Jurisdiction Under section 7436(a) this Court has jurisdiction to determine (1) whether an individual providing services to a “person” is that person’s employee, (2) whether the person, if in fact an employer, is entitled to relief under RA ’78 sec. 530, and (3) the correct amount of employment taxes which relate to the Commissioner’s determination concerning worker classification. Charlotte’s Office Boutique, Inc. v. Commissioner, 121 T.C. 89, 102-103 (2003), aff’d, 425 F.3d 1203 (9th Cir.
4* Does the taxpayer qualify for relief under Section 530, 3509(a) or 3402(d)?
As this determination is not related to an IRS audit, it does not constitute a notice ofdetermination under the provisions ofsection 7436, nor is this an audit for purposes ofentitling you to section 530 relief(further explained below) ifyou are not otherwise eligible for such reliefW 2The record contains no indication that respondent has ever conducted an audit or examination ofpetitioner.
at 2885, as amended. Further, pursuant to a telephone conference call that the Court held with the parties on July 1, 2013, respondent concedes that petitioner is not liable for additions to tax under sec. 6651(a)(2) for the taxable periods in issue. - 5 - commissions selling residential real estate in southern California. He co
at 2885. Petitioner did not address that issue on briefand indicated at trial that it did not intend to pursue that avenue for relief. - 3 - time the petition was filed, petitioner was an S corporation with its principal place ofbusiness in Franklin, Tennessee. Petitioner was formed on October 11, 2005. From January 1, 2006, to
The IRS also determined that D&R was not entitled to relief under section 530 of the Revenue Act of 1978, Pub.
2885, as amended, nor do they dispute, 'with respect to these employees, the application of penalties and additions to tax as determined in the notices of final determination. We deem petitioners to have waived any such arguments. - 11 - the status of an employee". Sec. 3121(d) (2). Under common law rules, the most important con
nt Tax Act (FUTA) for 1997, - 2 - 1998, and 1999 and each of the quarters therein (periods at issue).1 The issues for decision are: (1) Whether certain drivers who operated petitioner’s trucks were employees of petitioner for Federal employment tax purposes during the periods at issue and, if so, (2) whether petitioner is entitled to relief under section 530 of the Revenue Act of 1978, Pub.
f, in connection with an audit of any person, there is an actual controversy involving a determination by the Secretary as part of an examination that-- (1) one or more individuals performing services for such person are employees of such person for purposes of subtitle C, or (2) such person is not entitled to the treatment under subsection (a) of section 530 (continued .
Commissioner, 737 F.2d 1417 (5th (continued...) - 8 - Court has jurisdiction to determine (1) whether an individual providing services to a person is that person's employee for purposes of subtitle C, (2) whether the person, if in fact an employer, is entitled to relief under section 530 of the Revenue Act of 1978, and (3) the correct amount of employment taxes which relate to the Commissioner's determination concerning worker classification.
530 of the Revenue Act of 1978, Pub. L. 95-600, 92 Stat. 2885, fishing boat owners who erroneously classified employees as self-employed might be relieved of employment tax liability, and fishing boat workers, including petitioner, would be deemed not to be employees of the owners for employment tax purposes, if certain conditions were satisfi
ue for decision is - 2 - whether Virginia Exley (Exley) was an employee of petitioner for Federal employment tax purposes during 1996 through 1999. Petitioner concedes that it is not entitled to relief under the Revenue Act of 1978, Pub. L. 95-600, sec. 530, 92 Stat. 2885, as amended. The parties stipulated that Exley was not an independent contractor during 1996 through 1999. The parties agree that, if the Court determines that Exley is classified as an employee of petitioner for purposes of Fe
rs for employment tax purposes, if certain conditions were satisfied. See Joseph M. Grey Pub. Accountant, P.C. v. Commissioner, 119 T.C. 121, 130 (2002), affd. 93 Fed. Appx. 473 (3d Cir. 2004). There is no record evidence whether the requirements of sec. 530 of the Revenue Act of 1978 would be applicable in the case at hand to relieve the boat owners of employment tax liabilities. An unsuccessful fishing trip is known in the fishing trade as a “broker”. See The Dirigo First, 60 F. Supp. 675, 675
Petitioner concedes that he is not entitled to relief under section 530 of the Revenue Act of 1978, Pub.
Evans), shareholders of petitioner, were employees of petitioner during 1993, 1994, and 1995, and that petitioner is not entitled to “safe harbor” relief as provided by section 530 of the Revenue Act of 1978, Pub.
Henderson) was an employee of Olde Raleigh Realty Corporation (petitioner) for the tax periods ending December 31, 1995 and 1996, for purposes of Federal employment taxes, and (2) petitioner was not entitled to relief from these taxes as provided by section 530 of the Revenue Act of 1978, Pub.
Evans were employees of petitioner during 1993, 1994, and 1995, and that petitioner is not entitled to “safe harbor” relief as provided by section 530 with respect to Mr.
- 10 - employees of the company for purposes of Federal employment taxes under Subtitle C (Employment Taxes and Collection of Income Tax) of the Internal Revenue Code, and (2) petitioner was not entitled to “safe harbor” relief provided by section 530 of the Revenue Act of 1978, Pub.
The notice of determination further provided that petitioner was not entitled to “safe harbor” relief provided by section 530 of the Revenue Act of 1978, Pub.
Section 7436(a) confers upon this Court jurisdiction to determine whether service providers are employees or independent contractors for purposes of subtitle C and whether section 530 of the Revenue Act of 1978 applies.