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Publication 80

2. Who Are Employees?(p5)

Generally, employees are defined either under common law or under special statutes for certain situations. See Publication 15-A, Employer's Supplemental Tax Guide, for details on and nonemployees.

Employee status under common law.(p5)

Generally, a worker who performs services for you is your employee if you can control what will be done and how it will be done. This is so even when you give the employee freedom of action. What matters is that you have the right to control the details of how the services are performed. See Publication 15-A for more information on how to determine whether an individual providing services is an independent contractor or an employee.
Generally, people in business for themselves are not employees. For example, doctors, lawyers, veterinarians, and others in an independent trade in which they offer their services to the public are usually not employees. However, if the business is incorporated, corporate officers who work in the business are employees of the corporation.
If an employer-employee relationship exists, it does not matter what it is called. The employee may be called an agent or independent contractor. It also does not matter how payments are measured or paid, what they are called, or if the employee works full or part time.

Statutory employees.(p5)

There are also some special definitions of employees for social security, Medicare, and FUTA taxes.
While the following persons may not be common law employees, they are considered employees for social security and Medicare purposes if the conditions under Tests, discussed later, are met.


An agent (or commission) driver who delivers food or beverages (other than milk) or picks up and delivers laundry or dry cleaning for someone else.


A full-time life insurance salesperson who sells primarily for one company.


A homeworker who works by the guidelines of the person for whom the work is done, with materials furnished by and returned to that person or to someone that person designates.


A traveling or city salesperson (other than an agent-driver or commission-driver) who works full time (except for sideline sales activities) for one firm or person getting orders from customers. The orders must be for merchandise for resale or supplies for use in the customer's business. The customers must be retailers, wholesalers, contractors, or operators of hotels, restaurants, or other businesses dealing with food or lodging.
Withhold social security and Medicare taxes from statutory employees' wages if all three of the following tests apply.
  1. The service contract states or implies that almost all of the services are to be performed personally by them.
  2. They have little or no investment in the equipment and property used to perform the services (other than an investment in transportation facilities).
  3. The services are performed on a continuing basis for the same payer.
Persons in a or d, earlier, are also employees for FUTA tax purposes if tests 1 through 3 are met (U.S. Virgin Islands only).
Publication 15-A gives examples of the employer-employee relationship.

Statutory nonemployees.(p6)

Certain direct sellers, qualified real estate agents, and certain companion sitters are, by law, considered nonemployees. They are generally treated as self-employed for employment tax purposes. See Publication 15-A for details.

H-2A agricultural workers.(p6)

On Form W-2, do not check box 13 (Statutory employee) as H-2A workers are not statutory employees.

Treating employees as nonemployees.(p6)

If you incorrectly treated an employee as a nonemployee and did not withhold social security and Medicare taxes, you will be liable for the taxes. See Treating employees as nonemployees in section 2 of Publication 15 (Circular E), for details on Internal Revenue Code section 3509, which may apply.

IRS help.(p6)

If you want the IRS to determine if a worker is an employee, file Form SS-8, Determination of Worker Status for Purposes of Federal Employment Taxes and Income Tax Withholding.

Voluntary Classification Settlement Program (VCSP).(p6)

Employers who are currently treating their workers (or a class or group of workers) as independent contractors or other nonemployees and want to voluntarily reclassify their workers as employees for future tax periods may be eligible to participate in the VCSP if certain requirements are met. To apply, use Form 8952, Application for Voluntary Classification Settlement Program (VCSP). For more information, visit and enter "VCSP" in the search box.

Husband-Wife Business(p6)

If you and your spouse jointly own and operate a business and share in the profits and losses, you are partners in a partnership, whether or not you have a formal partnership agreement. See Publication 541, Partnerships, for more details. The partnership is considered the employer of any employees, and is liable for any employment taxes due on wages paid to its employees.

Exception—Qualified Joint Venture.(p6)

If you and your spouse materially participate as the only members of a jointly owned and operated business, and you file a joint Form 1040, U.S. Individual Income Tax Return, or joint Form 1040-SS, U.S. Self-Employment Tax Return—U.S. Virgin Islands, Guam, American Samoa, the Commonwealth of the Northern Mariana Islands, or Puerto Rico, you can make a joint election to be taxed as a qualified joint venture instead of a partnership. See the Instructions for Schedule C (Form 1040) or the Instructions for Form 1040-SS. Spouses electing qualified joint venture status are treated as sole proprietors for federal tax purposes. Either of the sole proprietor spouses may report and pay the employment taxes due on wages paid to the employees, using the EIN of that spouse’s sole proprietorship. For more information on qualified joint ventures, visit, enter "qualified joint venture" in the search box, and then select Election for Husband and Wife Unincorporated Businesses.

Farm Crew Leaders(p6)

You are an employer of farmworkers if you are a crew leader. A crew leader is a person who furnishes and pays (either on his or her own behalf or on behalf of the farm operator) workers to do farmwork for the farm operator. If there is no written agreement between you and the farm operator stating that you are his or her employee, and if you pay the workers (either for yourself or for the farm operator), then you are a crew leader.