Taxpayer worked for a company in 2007. He was supposed to be an employee. But the employer did not withhold tax and did not give him a W-2 at the end of the year. Taxpayer knows exactly how much that he has earned from this job. I plan to put the income on line 21 of Form 1040 and then file a Schedule SE for the social security tax. Any advice?
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Yes.
Dont' do it.Originally posted by NotEasy View Post
IF it's SE income, then proper way is to file a schedule cez with se of course.
But IF he were really an employee, proper thing to do is put it on line 7 as wages, use that
new fangled form 8... something or nother to use saying that he was really an employee and
give the reason why and compute just his half of the FICA. AND of course file an SS8 form.
However, as a practical measure, depending on the amount of wages, might be simpler
to go the schedule cez and se route.
it's client's decision.ChEAr$,
Harlan Lunsford, EA n LA -
New Form 8919 for 2007
Use Form 8919, Uncollected Social Security and Medicare Taxes on Wages, to pay the employee portion of the Fica and Medicare taxes.
Use SS-8, Determination of Worker Status for Purposes of Federal Employment Taxes and Income Withholding, to get a ruling but it is not pay the taxes.
As noted filing an SS-8 can have a siginificant financial impact on the employer. The penalities are the same as the trust fund penalties.Comment
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In a perfecg world,
IRS would follow up on all SS8 forms, but fact is they can't - and don't.Originally posted by gkaiseril View PostChEAr$,
Harlan Lunsford, EA n LAComment
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I didn't think
Can we file that new form and then pay just 1/2 of the FICA and Mcare on line 7. I didn't think we could. We have to file a SS-8 and wait.
It was much simplier when we could report on line 7 as wages and then file the 4137 for the employee's share.
The new form seems restrictive. So now what is the proper procedure?
SandyComment
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My first thought
I think they developed the form for a reason.
That's what I would use, provided the client never intends to work there again and understands what could happen to the employer if IRS does follow up."The only function of economic forecasting is to make astrology look respectful" - John Kenneth GalbraithComment
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Reason code "G" on the form is "I filed form SS-8 with the IRS and have not yet received a reply." So I think you're fine to file without the response on the SS-8, you just need to file an SS-8 as well.Originally posted by S T View PostComment
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