So this is messy because it’s both a family and work issue. I (late 20s) work for my mom. She owns a small business, and for the longest time my employment situation has been… confusing. I do everything an actual employee would do: fixed schedule, she supervises me, I use all her equipment, I follow her rules, I represent the business, etc. But every time I’ve brought up proper paperwork, she acts like I’m annoying her or “making it complicated.”
Fast-forward to now: I quit/got fired back in October and now she suddenly tells me she’s going to file me as a 1099 independent contractor. Which, to be clear, is NOT accurate for what I do. I don’t run my own business, I don’t control my work, and I’m not contracting out services. I’m an employee.
I explained (calmly) that if she misclassifies me, I get stuck paying both sides of the taxes, plus it’s illegal for her to do. She brushed it off and said something like, “Everyone has to do their taxes.” Then she tries to guilt-trip me, like I’m being ungrateful or dramatic for wanting my taxes handled correctly.
At this point, the whole situation feels like she’s trying to intimidate me into just eating the tax burden so she doesn’t have to do payroll.
So I told her, very neutrally: “I’m not going to engage with threats or guilt. If you file me as a 1099 contractor, I will need to file an SS-8 to have the IRS determine my correct status.”
That’s it. No yelling, no dramatics. Just a boundary.
She responded by email saying: “It breaks my heart to see things going in this direction. If you really want to take things to that level, I could mention the years of cash bartending income that was never reported, but I prefer to move forward. I wish you could do the same.”
She didn’t answer any of my questions about proper employee paperwork or a W-2; instead, she seemed to imply that bringing up misclassification was “going too far.”
For the record, I’m not trying to screw her over. I’m literally trying to avoid a massive tax mess and warn her that if she misfiles, the IRS will see it anyway. The SS-8 isn’t retaliation; it’s just the only formal way to protect myself.
Now she’s acting like I’m the villain for not wanting to commit tax fraud???
AITA for setting that boundary and telling her I’ll file an SS-8 if she misclassifies me?
NTA. I feel like you already know this, but your mom sucks so much you have to question it
NTA, and I don’t understand why you would think otherwise. As she put it, “everyone has to do their taxes.” Your desire to avoid paying tax penalties has nothing to do with ingratitude and everything to do with responsibility. She’s the one who’s taking things in this direction by trying to reclassify you after the fact.
NTA
No more discussion. Just do it.
People who want to cheat on taxes are so tiresome. I was married to one. I had to refuse to sign.
Bottom line: You don’t want the IRS to get on you for tax fraud. Does your mother know the consequences of that? They are not pretty. She won’t like them. She also won’t like that she involved you in a fraud and its penalties.
P.S. I feel I have to add that our country runs on taxes. Some people feel it’s getting over on the man to cheat on taxes. I feel it’s getting over on our fellow citizens; plus, eventually we all pay more so they can have their little crime spree.
Yeah so OP that was blackmail. NTA and do what you have to at this point.
That was blackmail in writing.
File asap with a professional! First in normally does better on this situation
She can “mention” a cash bartender job that you had, but can it be verified? She could also mention that you have a billion dollars in an overseas account and that you are hiding money, but that doesn’t mean it’s true or accurate. Do not engage or acknowledge that threat in any way. Just ignore it. Especially in emails that can be used as evidence.
Tell her that you insist that she files properly, or you will have no choice but to cover your own backside with filing the SS-8 paperwork. Her threats are only going to make life more difficult and complicated for her with the IRS.
Then be prepared for her to file a 1099 and follow through with your filing a SS-8 and let her have her melt down.
OP should file their paperwork first.
NTA
Sounds like she spent the money instead of saving it for taxes, and is now panicking.
NTA. Your mother is a tax cheat. Make sure your info is right and stop worrying about hers.
When an employee is misclassified as an independent contractor the proper way to handle it is to file Form SS-8 and to include Form 8919 with their tax return.
This asks the IRS to investigate and officially determine whether or not they were misclassified, and it also gets the employee out of paying the employer’s share of the SS and Medicare taxes with their tax return.
This may not however, result in as much of a tax savings as someone might think. The employee still has to pay the full amount of regular income tax (in a lump sum, since they had no withholding) and the employee share of SS and Medicare taxes. The savings represents about 7.685% of the gross income.
It is only the employer who is committing tax fraud in this scenario. If the employee does not file Form SS-8 and Form 8919 they are not committing tax fraud, they are just allowing themselves to be cheated and allowing the employer to get away with it. They should not allow that.
INFO
Has she deducted any payroll taxes from your paychecks?
If no taxes have been deducted at all, you are going to owe taxes no matter what.
But if you have been receiving the gross amount the entire time, she pretty much set you up. The first time you recipients a paycheck with no taxes deducted, you should have had this conversation.
So lemme see. She deliberately refuses to classify you as an employee for years, she apparently fires you, she wants to have you bear a double tax burden, and then she says you’re going too far and are the bad one?
This is actively evil. You are definitely NTA but I can tell you who is.