Misclassified workers to file new tax form

IRS Form 8919, Uncollected Social Security and Medicare Tax on Wages, must generally be used by workers who performed services for an employer but the employer did not withhold the worker’s share of Social Security and Medicare taxes, beginning with the 2007 tax year. Misclassified workers should no longer use Form 4137, Social Security and Medicare Taxes on Unreported Tip Income. Form 4137 should now only be used by tipped employees to report Social Security and Medicare taxes on allocated tips and tips not reported to their employers.

For California purposes, “The EDD does not have at this time, a process or form similar to the IRS’ Form 8919…. If the employer deducts less than the correct amount of tax, he or she is nevertheless liable for the correct amount of the tax. 
 
“In most cases, misclassified workers report their income via the Miscellaneous Income, Form 1099-MISC, that was provided by the principal or employer on their personal income tax return for each year they receive the 1099 and pays the appropriate California State Personal Income Tax (PIT) associated with that income. Any adjustments or processes regarding how to determine the correct employment tax liability as a result of misclassified workers, is primarily focused towards the employer community.” [E-mail to Spidell Publishing, Inc. on December 26, 2007].