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IRS Form SS-8 Worker Status - anon
Posted: Jun 02, 2012
If you believe your current or past work status is/was improperly categorized by a firm or person (independent contractor versus employee) you can complete IRS Form SS-8 (Determination of Worker Status for Purposes of Federal Employment Taxes and Income Tax Withholding). There is no fee for requesting a Form SS-8 determination letter.
IRS: "Employers who misclassify workers as independent contractors can end up with substantial tax bills. Additionally, they can face penalties for failing to pay employment taxes and for failing to file required tax forms. Both employers and workers can ask the IRS to make a determination on whether a specific individual is an independent contractor or an employee by filing a Form SS-8, Determination of Worker Status for Purposes of Federal Employment Taxes and Income Tax Withholding, with the IRS."
The information provided on Form SS-8 may be disclosed to the payer named on the form. If you don't want the information disclosed to the payer, don't file the form.
I did that! - anon
[ In Reply To ..]You know those emails you get at all hours of the day and night asking where are you people and comments regarding "your shift" or such language when you are an IC, well save all of those because I did. I filed a request for a letter of determination with the IRS several years ago and submitted my contract as an IC and all those type of emails, and it was determined that the position should have been employee and not IC. The company was fined and had to file as an employer and pay back taxes.
If you don't stand up for yourself no one will and you will always regret it later. This industry has become fear-driven, especially more so because of the recession. Hard working people are being taken advantage of to line the pockets of others and you are the only one that can stop it from happening to you.
back wages AND benefits possibly - anon
[ In Reply To ..]The employer who misclassified may also be subject to healthcare costs and/or insurance costs during the time you were misclassified. If you were REALLY an employee but they didn't pay benefits because they erroneously classified you as an independent contractor, and they pay their employees benefits, the employer may also be subject to back-pay of benefit costs for that period.
No fear - anon
[ In Reply To ..]No one should be afraid to use this method to verify if their work classification is incorrect. The IRS encourages both sides to verify it with them. If you have the slightest concern that you are misclassfied you should contact the IRS. Working at home is wonderful, but it's not an excuse to rip us off.
question - confused
[ In Reply To ..]It was my understanding that the fine line is that ICs are supposed to be able to say when they are available, and MTSOs plan around that. My question is what if you are doing the same account day after day, albeit on your own schedule and workload. Is the fact that it is consistent going to cause you to not be classified IC?
that is correct--has to be a task they cannot do for themselves - anon
[ In Reply To ..]The schedule is a key consideration, but not the only one. An IC can only perform a job that you or your employee cannot. Sort of like a plumber, yard person, pest control, etc. Simply classifying someone as an IC to avoid the payroll taxes and benefits is illegal and has been, I think, the chief reason our industry has tanked. Because of using illegal labor (like a sweat shop), they can lower the rate charged to hospitals, and the industry has taken a nose dive in terms of pricing. If they had continued to pay fair wages plus benefits, this would not have happened.
Thank you for this info! - nm
[ In Reply To ..].
More info.... - sm
[ In Reply To ..]The IRS Gives Employees a Whistle to Blow and Employers a Safe Harbor
By Peter Milne | Published: May 5, 2011
The IRS has given an employee worker wrongly clasÂÂsiÂÂfied as an indeÂÂpenÂÂdent conÂÂtracÂÂtor a very loud whisÂÂtle to blow and employÂÂers the means to obtain an advance deterÂÂmiÂÂnaÂÂtion of worker clasÂÂsiÂÂfiÂÂcaÂÂtion to avoid future disÂÂputes and tax liabilities.
When is a worker an employee or an indeÂÂpenÂÂdent conÂÂtracÂÂtor for fedÂÂeral income tax purÂÂposes? DisÂÂputes over employee or indeÂÂpenÂÂdent conÂÂtracÂÂtor clasÂÂsiÂÂfiÂÂcaÂÂtion freÂÂquently arise and the outÂÂcome is usuÂÂally very imporÂÂtant to one and very expenÂÂsive for the other. MisÂÂtakes are someÂÂtimes made, but more often, employÂÂers will incorÂÂrectly clasÂÂsify an employee as an indeÂÂpenÂÂdent conÂÂtracÂÂtor for sevÂÂeral reaÂÂsons. The most comÂÂmon reaÂÂson is to avoid the payÂÂment of the employer’s porÂÂtion of employÂÂment taxes (usuÂÂally about 7.5% of gross). The secÂÂond reaÂÂson is to avoid the prepaÂÂraÂÂtion and filÂÂing of quarÂÂterly 941 employÂÂment tax returns. Another reaÂÂson is to avoid makÂÂing employÂÂment tax deposits. SomeÂÂtimes, employÂÂers may not underÂÂstand the legal and tax difÂÂferÂÂence between an employee or indeÂÂpenÂÂdent conÂÂtracÂÂtor and clasÂÂsify the worker in whatÂÂever way the worker suggests.
A worker who should be clasÂÂsiÂÂfied as an employee may want to be treated as an indeÂÂpenÂÂdent conÂÂtracÂÂtor so that payÂÂroll taxes and fedÂÂeral income taxes are not withÂÂheld from his or her earnÂÂings. More comÂÂmon is the sitÂÂuÂÂaÂÂtion where a worker who is clasÂÂsiÂÂfied as an indeÂÂpenÂÂdent conÂÂtracÂÂtor wants to be treated as an employee so that more of his or her earnÂÂings are reported to the Social SecuÂÂrity AdminÂÂisÂÂtraÂÂtion. The more income reported as earned, the higher the monthly retireÂÂment benÂÂeÂÂfit. In cerÂÂtain trades and busiÂÂnesses, such as conÂÂstrucÂÂtion, landÂÂscapÂÂing, houseÂÂkeepÂÂing, janÂÂiÂÂtoÂÂrÂÂial, farmÂÂing, ranchÂÂing, fishÂÂing, repair and maintenance-where workÂÂers traÂÂdiÂÂtionÂÂally earn pieceÂÂmeal or by the job and are often unskilled and less eduÂÂcated –the worker simÂÂply has no choice as to whether they are clasÂÂsiÂÂfied as an employee or as an indeÂÂpenÂÂdent contractor.
The IRS proÂÂvides Form SS-8 -DeterÂÂmiÂÂnaÂÂtion of Worker StaÂÂtus for PurÂÂposes of FedÂÂeral EmployÂÂment Taxes and Income Tax WithÂÂholdÂÂing– for use by an employer when the employer is not sure how to clasÂÂsify a worker. Upon subÂÂmisÂÂsion of the SS-8, the IRS will make an advance deterÂÂmiÂÂnaÂÂtion of how the worker should be clasÂÂsiÂÂfied, which gives the employer a safe harÂÂbor if the worker ever comÂÂplains or if the wrong clasÂÂsiÂÂfiÂÂcaÂÂtion is made.
In addiÂÂtion, the IRS proÂÂvides Form 8819– UncolÂÂlected Social SecuÂÂrity and Medicare Tax on Wages- to a worker who believes that his or her employÂÂment clasÂÂsiÂÂfiÂÂcaÂÂtion is incorÂÂrect. Form 8819 is the big, loud and often very expenÂÂsive whisÂÂtle, that when subÂÂmitÂÂted with Form SS-8, alerts the IRS to a posÂÂsiÂÂble improper clasÂÂsiÂÂfiÂÂcaÂÂtion and perÂÂmits the employer’s porÂÂtion of social secuÂÂrity and medicare taxes to be credÂÂited in advance to the worker’s social secuÂÂrity record.
If the IRS ultiÂÂmately agrees that the whisÂÂtle blowÂÂing worker has been misÂÂclasÂÂsiÂÂfied, the actions of the employer will be careÂÂfully scruÂÂtiÂÂnized. An employer who impropÂÂerly clasÂÂsiÂÂfies an employee as an indeÂÂpenÂÂdent conÂÂtracÂÂtor may be subÂÂjected to an audit. The books and records of the employer will be examÂÂined and workÂÂers may be quesÂÂtioned. In addiÂÂtion to an after the fact assessÂÂment of the employer’s porÂÂtion of employÂÂment taxes, the employer who misÂÂclasÂÂsiÂÂfies a worker or workÂÂers may be subÂÂjected to ordiÂÂnary civil failÂÂure to deposit, failÂÂure to file and failÂÂure to pay when due (delinÂÂquency) penalÂÂties, the more seriÂÂous civil fraud penalty and the most seriÂÂous of all, a fedÂÂeral crime. None of these outÂÂcomes are good for busiÂÂness, even in the best of times.
If you are an employer that is unsure of how to clasÂÂsify a worker, that has disÂÂcovÂÂered cerÂÂtain workÂÂers have been misÂÂclasÂÂsiÂÂfied, or that has intenÂÂtionÂÂally misÂÂclasÂÂsiÂÂfied workÂÂers, seek legal assisÂÂtance immeÂÂdiÂÂately. If you are a worker who believes that he or she has been misÂÂclasÂÂsiÂÂfied and wants some recourse, don’t wait to blow the whistle.
The area of worker clasÂÂsiÂÂfiÂÂcaÂÂtion can be very conÂÂfusÂÂing. MisÂÂtakes are comÂÂmon. MisÂÂclasÂÂsiÂÂfiÂÂcaÂÂtion of worker staÂÂtus to keep costs low or for exploitaÂÂtive purÂÂposes freÂÂquently hapÂÂpen.
IRS training guide - anon
[ In Reply To ..]http://www.irs.gov/pub/irs-utl/emporind.pdf
Thank you so much for this valuable info!!! - AnotherAnon
[ In Reply To ..].
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