Sec 3509

Technical topics regarding tax preparation.
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If client has contractors in past year reclassified by DOL audit (two = one made $8,000 and one made $500) can they qualify for Sec3509?

https://www.law.cornell.edu/uscode/text/26/3509

1099 for the greater than $600 was filed late so I would think that doesn't allow for Sec 3509(a), but would still be good for 3509(b). Contractor was employee in a prior year, but duties/time committment changed so I don't think there was "intentional disregard". Employer had some payroll issues though, so just wants to do the right thing and pay up.

Steps needed:
1. Amend 941s (2 quarters) by due date after error discovered (assuming date discovered would be DOL audit finding date)
2. pay tax by due date after error discovered
3. Correct 1099 to $0
4. File W2 for Box 1, 3, 5 for same amount as 1099, $0 for all withholdings in Box 2, 4, 6
 

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