"Perhaps you failed Reading 101."

*****My reading comprehension is just fine but perhaps your's is a wee bit off since you don't seemed to have comprehended the rules posted about "Also, please no insults or personal attacks." which is posted at the top of this forum.

> I never questioned the need to collect
> taxes. And it was not "his" taxes
> that were in question.

*****No, but it was "his" money that suddenly had to be coughed up for the witholding the IRS told him he should have been paying. Then he has to turn around and collect the money (which would normally have been a standard payroll deduction)from the drivers. And since we live in litigious times, what are the odds some of them considered not paying and seeking legal action against your friend, their employer, because he gave them incorrect information about what constitutes an independent contractor and now they suddenly have to pony up the payment to him instead of waiting 'til later on when they would normally file their tax return? (And I genuinely hope, for your friend's sake, none of them did that especially since they, too, could have checked this out before accepting the working arrangement.)

The issue was did the
> IRS have the right to tell a business man
> how he should run his business.

******At what point did the IRS tell your friend how he should run his business? Did the IRS tell him he was not allowed to use independent contractors? Or did the IRS tell him, and the drivers, they did not fit the criteria, set forth by our Department of Labor, of what the legal definition of contract labor is? Surely a man of your comprehension level can see those are severely different issues. Perhaps your friend wasn't aware that "control of time" is one of the biggies when determining whether or not a worker is considered, by the Feds and the State, to be contract labor.

The tax LAWS you claim he ignored, do not define independant contractors. These definitions are IRS interpretations of the intent of Congress.

*****You're correct on one thing, the tax laws don't define who is/isn't an independent contractor. The Department of Labor defines that. State government may also define that. Yep, more of those pesky government agencies. And I know you probably won't believe me but the laws determining contract labor are specific and don't leave room for interpretation (unless it's Clarence Darrow doing the interpretation). The criteria is set and you either meet it or you don't. If you don't meet the legal definitions of contract labor, then it doesn't matter what you put on your business card because the method and amount of your taxation is set according to how the government defines your employment/business situation.

> I still feel that the IRS harshly defines
> independant contractors, because they are
> addicted to businesses collecting their
> taxes and they don't want a bunch of truck
> drivers fumbling though a Schedule C.

*****Or maybe it's because independent contractors are businesses and are taxed at a different rate and payment schedule than employees. It could also be because a lot of so-called independent contractors (I'm not pointing fingers at the drivers working for your friend, just speaking generally.)are flying under the radar and aren't reporting their taxable earnings/profits (which, again, means higher taxes for the rest of us). It could also be because State governed unemployment benefits and labor law rights can be affected because of the distinction of whether or not a person was an employee or an independent contractor.

And since you seem to think I was attacking your friend (which was NEVER my intent) let me be very, very clear on the point of my messages:

Anyone who wants to run a business which involves using the services of other people should contact someone knowledgeable (the government agencies, business accountants, etc....don't go to Uncle Harry or Aunt Betty unless they actually work in the those fields) about Department of Labor laws and business tax laws so they won't end up in a situation like the man and drivers in the story. To do otherwise is irresponsible. I'm not saying it makes a person a horrible person, I'm saying it's irresponsible.

:)
EM