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Both the employment tax return and employee FIC
statutes are extended using Form SS-10. There is no statute date for unfiled returns, but
transcripts must be secured and substitute procedures followed to process
adjustments in such cases. A return filed showing no liability for the quarter,
is sufficient to start the running of the statute. Unagreed cases receive a 30-day letter but are not
subject to deficiency procedures as are income tax cases. If there is no
response to the 30-day letter, or if the taxpayer declines to execute a
necessary extension of the statute, the case is defaulted and the taxpayer is
billed. The taxpayer's only recourse after the assessment is made is to pay a
portion of the tax and file a claim for refund. When agreement to adjustments made to a previously
filed return is secured on Form 2504, the taxpayer is entitled to relief from
accumulated interest under IRC section 6205. It is necessary to note the Code
section and the type of tax on the Form 3198. Interest will begin to accrue,
however, if the tax is not paid by the due date of return for the quarter in
which consent was secured. It should be noted that the determination of an
employer-employee relationship may affect other areas of Federal law. For
example, the Supreme Court held in Nationwide Mutual Insurance Co. v.
Darden, 112 S. Ct. 1344 (1992), that the term "employee," as used
in the Employee Retirement Income Security Act, incorporates traditional agency
law for identifying master-servant relationships. 9-13 Chapter 1 Chapter 2 Chapter 3 Chapter 4 Chapter 5 Chapter 6 Chapter 7 Chapter 8 Chapter 9 Chapter 10 Glossary |