Accounting and Tax Services
May 18

New Form for Misclassified Workers

The IRS has developed a new form for an employee who has been misclassified as Independent Contractors by an employer.  Uncollected Social Security and Medicare Tax on Wages, Form 8919, will now be used to figure and report the employee’s share of uncollected social security and Medicare taxes due on his/her compensation. 

The worker must meet one of the following criteria indicating he/she was an employee while performing the services:

  • Filed Form SS-8, Determination of Worker Status for Purposes of Federal Employment Taxes and Income Tax Withholding, and received a determination letter from the IRS stating he/she is an employee of the firm.
  • Designated as a section 530 employee by his/her employer or by the IRS prior to January 1, 1997.
  • Received other correspondence from the IRS that states he/she is an employee.
  • Previously treated as an employee by the firm and he/she is performing services in a similar capacity and under similar direction and control.
  • Co-workers are performing similar services under similar direction and are treated as employees.
  • Co-workers are performing similar services under similar direction and control and filed Form SS-8 for the firm and received a determination that they were employees.
  • Filed Form SS-8 with the IRS and has not yet received a reply.
  • The IRS will electronically share Form 8919 data with the Social Security Administration to facilitate crediting the worker’s social security and Medicare taxes to his/her social security record.

Source: IRS News Release IR-2007-2003, Dec. 20, 2007

About Reed Tinsley, CPA

As a top advisor to physicians, I help increase practice profits by delivering hands-on, expert medical accounting/tax support, practice counsel, and revenue-building strategies. Read more →