Form 8919-T

[mandre007]

Good afternoon,

I have a client that got injured on the job, while working as an independent. contractor. I file for 8919-T to report the uncollected SS and Medicare tax on wages. Would I need to report the income on a schedule C.

Please advise.

[Just-Lisa-Now-]

Im not sure what the 8919 is for in this situation.  What uncollected SS/Mdcr?   

If shes an independent contractor Sch C is whats used to report business income and expenses for self employed people.

[Skylane]

The question for an 8919T is was he an employee or contractor…. i assume he received a 1099-nec so the IRS is going to be looking for a sch C. The injured on the job IMPLIES he may be trying to collect (state) benefits that are only available to employees….Theres obviously more to the story if you want to provide details.

[mandre007]

He is technically an employee that did not receive a 1099. He got injured on the job and his lawyer suggested for him to fill out the 8919 - T to report his wages in order to receive workman's compensation.

[mandre007]

This is to report his wages and pay the social security tax. The company did not issue a 1099, but adding the wages resulted in tax liability. I do not want to report the income twice.

[qbteachmt · Accepted solution]

It's called Worker Misclassification:

You must file Form 8919 if all of the following apply. You performed services for a firm. You believe your pay from the firm wasn't for services as an independent contractor. The firm didn't withhold your share of social security and Medicare taxes from your pay.

In other words, your taxpayer didn't get Wages. That's why nothing is withheld. An independent contractor is responsible, as they are running their own business, for all of that. Or, the arrangement was a lie, and the taxpayer was working misclassified.

[mandre007]

Lisa,

I understand, but once i entered the wages, the software calculates the tax liabilities.

[mandre007]

In this case, will the 8919 suffice without filing a schedule C. Or do I need to file the schedule C?

[qbteachmt]

"Or do I need to file the schedule C?"

You still have this confused.

Your taxpayer either is an independent contractor, would file a tax form for their business (in this case, Sched C for Sole Proprietorship), and that would result in their business income and any amount subject to Self-employment taxes, which is Medicare and Social Security, is figured out from the Sched C, on the Sched SE. Done.

Or, you think your taxpayer really is supposed to be on payroll as an employee, a direct hire person and that you and that taxpayer are essentially accusing the Employer (your taxpayer's customer, really), of Lying and manipulating, or, at the least, being completely uninformed of Worker Misclassification. If so, you and your taxpayer intend to tell the IRS and turn the employer in for doing it wrong. That is Form 8919.

Don't do what a lawyer tells you, because the Lawyer is not responsible for Tax Filing. You do what applies.

Tell the lawyer, if the taxpayer really was an independent contractor, the lawyer should be pursuing a Law Suit. Because that's what the lawyer does for a living. Not taxes.

[mandre007]

I thank you very much for the advice.

Best Regards,

[qbteachmt]

It helps to know when not to use the word Wages. Independent Contractor doesn't get paid as Wages. You would be a customer, and you are paying them because you owe them for goods and/or services. That isn't Wages. That's their business income, from you.

[Skylane]

The attorney is trying to make a case for workers compensation. 

Filing the 8919 will create the tax.  The tax must be paid so you do not have to file sch C (I'm assuming that he didn't file one in the past).Did the attorney file an SS8?   

Check with the attorney before filing so that you are both on the same page.

The attorney should give you guidance. 

[qbteachmt]

"The attorney is trying to make a case for workers compensation."

Which is neither Social Security nor Medicare. That is typically Worker Comp through insurance (independent or a State Fund program).

The attorney is first trying to get everyone to tattle on everyone else. There is no evidence that is even an issue, at this time. Worker Misclassification is its own issue to determine.

[TaxGuyBill]

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@Skylane wrote:.Did the attorney file an SS8?  

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In my opinion, this is the key.

Form 8919 can't be filed until SS-8 is filed.  An SS-8 means somebody is arguing that this person is NOT a contractor, but is an employee.  So if the attorney is arguing that, the attorney should be filing the SS-8.

After the SS-8 is filed, you can file the 8919 to pay the taxes as an employee.  If you file a 8919, you DON'T also file a Schedule C for that income.

[Skylane]

@qbteachmt  “The attorney is first trying to get everyone to tattle on everyone else”

Every state has laws protecting “employees.”  The definition of employees is broad. IF, for example, an undocumented worker, who gets paid in cash, falls off a roof and suffers serious injury, the injured worker still has rights in the eyes of the state.

OP indicated No w2 or 1099 was issued. The state department of labor will ultimately deal with the employer. It is the attorneys job to establish that the injured worker should have been “considered” an employee and protected by the workers comp statute.

The employer will have a workers comp policy. it’s a statutory requirement.The attorney will file petition in work comp court to get coverage under the policy.  Filing a correct tax return to support the position is part of the process. 

[qbteachmt]

@Skylane Yep, pretty much everything I stated or pointed out.