May 2008 Headlines

Bill Introduced in House of Representatives Would Repeal Section 530
On April 15, 2008 – the due date for income-tax returns for individuals and pass-through entities – House Ways and Means Committee Member Jim McDermott (D-WA) introduced a bill, H.R. 5804, that would repeal Section 530 of the Revenue Act of 1978 (“Section 530”) and replace it with a new safe-harbor provision that fewer taxpayers could satisfy and whose protections would be largely illusory. Full article

Performing Artist Held Employee
A recent decision reveals how workers'-compensation and unemployment statutes that deem certain categories of workers statutory employees – without regard to whether they otherwise qualify as independent contractors – can produce undesirable consequences for the covered workers whom the proponents of such laws seek to help. Full article

Former Employee Social Worker Engaged as IC Reclassified as Employee
A recently published Internal Revenue Service ("IRS") ruling reveals the perils of a firm converting an employee to independent-contractor status and engaging that individual to perform services similar to services that the company's own employees perform. Full article

State Welfare Payments Exempt from Form 1099 Reporting
An Internal Revenue Service ("IRS") ruling illustrates the application of an exemption from Form 1099 reporting that can apply to payments made by government agencies under a social benefit program – such as the elder-care programs that are flourishing among the states. Full article