Re: OT(kinda): Texas Plane Crash - The Note

Nonsense.  Most of us here are not criminals.

He was simply pushed beyond his melting point is all. It can happen to
anyone here.. All of us are capable of doing such. But most of us
wont. Sadly, this trend will only continue. They will be more frequent
and more hideous.

[snip]

The checklist is available and, with a little legal advice, pretty easy
to follow. This guy either didn't have good advice or had too big an ego
to look for/follow it.

Here's part of the actual tete-a-tete with Atmel...

http://www.irs.ustreas.gov/pub/irs-pdf/p15a.pdf which defines:

Independent Contractors

People such as lawyers, contractors, subcontractors, public
stenographers,
and auctioneers who follow an independent trade, business, or
profession in
which they offer their services to the public, are generally not
employees.
However, whether such people are employees or independent contractors
depends on the facts in each case. The general rule is that an
individual
is an independent contractor if you, the person for whom the services
are
performed, have the right to control or direct only the result of the
work
and not the means and methods of accomplishing the result.

Also:  http://www.irs.gov/businesses/small/article/0,,id=99921,00.html

URL  http://www.starkman.com/articles/indepcon.htm  explains Section
530
"relief".

URL http://www.freeagent.com/advice/contractprofessional/1706.asp ....

Sec. 1706. TREATMENT OF CERTAIN TECHNICAL PERSONNEL (a) IN GENERAL —
Section 530 of the Revenue Act of 1978 is amended by adding at the end
thereof the following new subsection: "(d) EXCEPTION--This section
shall
not apply in the case of an individual who, pursuant to an arrangement
between the taxpayer and another person, provides services for such
other
person as an engineer, designer, drafter, computer programmer, systems
analyst, or other similarly skilled worker engaged in a similar line
of
work."

The crap URL: http://muextension.missouri.edu/xplor/regpubs/ncr546.htm

conjures up erroneous suppositions....

(1)Instructions: An employee must comply with instructions about when,
where and how to work. Even if no instructions are given, the control
factor is present if the employer has the right to control how the
work
results are achieved.

Atmel provides NO instructions... you just issue a Purchase Order for
deliverable items.  I determine "when, where and how".

(2) Training: An employee may be trained to perform services in a
particular manner. Independent contractors ordinarily use their own
methods
and receive no training from the purchasers of their services.

Should I laugh?

(3) Integration: An employee's services are usually integrated into
the
business operations because the services are important to the success
or
continuation of the business. This shows that the employee is subject
to
direction and control.

No integration.

(4) Services rendered personally: An employee renders services
personally.
This shows that the employer is interested in the methods as well as
the
results.

Huh?  What does render "services personally" mean?

(5) Hiring assistants: An employee works for an employer who hires,
supervises and pays workers. An independent contractor can hire,
supervise
and pay assistants under a contract that requires him or her to
provide
materials and labor and to be responsible only for the result.

I do have a number of hired assistants, actually subcontractors,
businesses
in their own right... they don't do Atmel work since you have your own
layout department.

(6) Continuing relationship: An employee has a continuing relationship
with
an employer. A continuing relationship may exist even if work is
performed
at recurring although irregular intervals.

Our relationship is only as long as the P.O.

(7) Set hours of work: An employee usually has set hours of work
established by an employer. An independent contractor generally can
set his
or her own work hours.

I set my own hours.

(8) Full-time required: An employee may be required to work or be
available
full-time. This indicates control by the employer. An independent
contractor can work when and for whom he chooses.

I have multiple customers.

(9) Work done on premises: An employee usually works on the premises
of an
employer, or works on a route or at a location designated by an
employer.

I work in my own premises.

(10) Order or sequence set: An employee may be required to perform
services
in the order or sequence set by an employer. This shows that the
employee
is subject to direction and control.

I work on projects under my own direction.

(11) Reports: An employee may be required to submit reports to an
employer.
This shows that the employer maintains a degree of control.

I don't submit reports... I ship deliverables: Schematics.

(12) Payments: An employee is paid by the hour, week or month. An
independent contractor is usually paid by the job or on a straight
commission.

This is fallacious... lawyers are paid by the hour.  Is your lawyer
your
employee?

(13) Expenses: An employee's business and travel expenses are
generally
paid by an employer. This shows that the employee is subject to
regulation
and control.

Not so.  Purchase orders are often specified as fee plus expenses.

(14) Tools and materials: An employee is normally furnished
significant
tools, materials and other equipment by an employer.

I use my own tools (at great expense).

(15) Investment: An independent contractor has a significant
investment in
the facilities he or she uses in performing services for someone else.

I have CONSIDERABLE investment in computers and software.

(16) Profit or loss: An independent contractor can make a profit or
suffer
a loss.

I do business as a subchapter-S corporation.

(17) Works for more than one person or firm: An independent contractor
is
generally free to provide his or her services to two or more unrelated
persons or firms at the same time.

Redundant question... I have multiple customers.

(18) Offers services to the general public: An independent contractor
makes
his or her services available to the general public.

Nonsense.  Contractors can offer services to only a segment of the
marketplace.

(19) Right to fire: An employee can be fired by an employer. An
independent
contractor cannot be fired so long as he or she produces a result that
meets the specifications of the contract.

You can't "fire" me, but you can terminate the P.O. at any time by
paying
for project milestones already completed.

(20) Right to quit: An employee can quit his or her job without at any
time
incurring liability. An independent contractor usually agrees to
complete a
specific job and is responsible for its satisfactory completion, or is
legally obligated to make good for failure to complete it.

Yep, that describes my work.
       
                                       ...Jim Thompson

           
I love to cook with wine.     Sometimes I even put it in the food.

Perhaps.

He set up some kind of company with no employees, only hired
"contractors", thus no withholding, etc., issues 1099 for each
"contractor" each year.

Contractor takes all the benefits of self-employment.

Net: Lower total taxes collected by IRS.

IRS declares contractors to be employees, seizes all of Stack's assets
for taxes he should have withheld.

Happened to me, except I was the "contractor", and Atmel was the
hiring company.

IRS jumped all over Atmel, just as they have jumped over many a
company, to have me declared an "employee".

We had a simple sit-down:

Where is Thompson's office?  Arizona.  Does Atmel or Thompson own it?
Thompson.

Who owns the tools and software Thompson uses in the course of his
business?  Thompson.

Does Atmel DIRECT Thompson and tell him what to do in the course of
his work?  Hell NO!

End of discussion ;-)

Somewhere around here I have a copy of that very section of the Tax
Code, if anyone would like it posted.
       
                                       ...Jim Thompson

           
I love to cook with wine.     Sometimes I even put it in the food.

Sounds like this guy didn't have the brightest accountants/lawyers when
he set up his companies.

The guy who reportedly just flew a plane into the Texas IRS building was an
enginner.
His apparent "suicide note" outlines some issues with being a contract
engineer in the US:

http://www.cnn.com/2010/US/02/18/texas.plane.crash.profile/?hpt=T1

The note:
http://i2.cdn.turner.com/cnn/2010/images/02/18/stack.letter.pdf

Dave.