Publication 80 - Circular Ss - Department Of The Treasury Page 4
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24Comments and suggestions. We welcome your com-
Tests. Withhold social security and Medicare taxes
ments about this publication and your suggestions for
from statutory employees’ wages if all three of the follow-
future editions.
ing tests apply.
You can email us at *taxforms@irs.gov. Please put
1) The service contract states or implies that almost all
“Publications Comment” on the subject line.
of the services are to be performed personally by
You can write to us at the following address:
them.
Internal Revenue Service
2) They have little or no investment in the equipment
TE/GE and Specialty Forms and Publications Branch
and property used to perform the services (other
SE:W:CAR:MP:T:T
than an investment in transportation facilities).
1111 Constitution Ave. NW
3) The services are performed on a continuing basis for
Washington, DC 20224
the same payer.
Persons in a and d above are also employees for FUTA tax
We respond to many letters by telephone. Therefore, it
purposes if tests 1 through 3 are met (U.S. Virgin Islands
would be helpful if you would include your daytime phone
only).
number, including the area code, in your correspondence.
Pub. 15-A gives examples of the employer-employee
relationship.
1. Who Are Employees?
Statutory nonemployees. Certain direct sellers and cer-
tain real estate agents are by law considered nonemploy-
Generally, employees are defined either under common
ees. They are treated as self-employed for employment tax
law or under special statutes for certain situations.
purposes. See Pub. 15-A for details.
Treating employees as nonemployees. If you incor-
Employee status under common law. Generally, a
rectly treated an employee as a nonemployee and did not
worker who performs services for you is your employee if
withhold social security and Medicare taxes, you will be
you can control what will be done and how it will be done.
liable for the taxes. See Internal Revenue Code section
This is so even when you give the employee freedom of
3509 for details.
action. What matters is that you have the right to control
the details of how the services are performed. See Pub.
IRS help. If you want the IRS to determine if a worker is an
15-A, Employer’s Supplemental Tax Guide, for more infor-
employee, file Form SS-8, Determination of Worker Sta-
mation on how to determine whether an individual provid-
tus for Purposes of Federal Employment Taxes and In-
ing services is an independent contractor or an employee.
come Tax Withholding.
Statutory employees. There are also some special defi-
Farm Crew Leaders
nitions of employees for social security, Medicare, and
FUTA taxes.
You are an employer of farmworkers if you are a crew
While the following persons may not be common law
leader. A crew leader is a person who furnishes and pays
employees, they are considered employees for social se-
(either on his or her own behalf or on behalf of the farm
curity and Medicare purposes if the conditions under Tests
operator) workers to do farmwork for the farm operator. If
below are met.
there is no written agreement between you and the farm
operator stating that you are his or her employee, and if
a. An agent (or commission) driver who delivers food or
you pay the workers (either for yourself or for the farm
beverages (other than milk) or picks up and delivers laun-
operator), then you are a crew leader.
dry or dry cleaning for someone else.
b. A full-time life insurance salesperson who sells prima-
2. Employer Identification
rily for one company.
Number (EIN)
c. A homeworker who works by the guidelines of the
person for whom the work is done, with materials furnished
An employer identification number (EIN) is a nine-digit
by and returned to that person or to someone that person
designates.
number that the IRS issues. Its format is 00-0000000. It is
used to identify the tax accounts of employers and certain
d. A traveling or city salesperson (other than an
other organizations and entities that have no employees.
agent-driver or commission-driver) who works full time
Use your EIN on all of the items that you send to the
(except for sideline sales activities) for one firm or person
IRS and SSA for your business.
getting orders from customers. The orders must be for
If you do not have an EIN, request one on Form SS-4,
items for resale or use as supplies in the customer’s
Application for Employer Identification Number. Form SS-4
business. The customers must be retailers, wholesalers,
contains information on how to apply for an EIN by mail,
contractors, or operators of hotels, restaurants, or other
fax, or telephone. You can also apply online at
businesses dealing with food or lodging.
Page 4
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