This is my first posting to this listserve - I would very much appreciate your advice in a situation that has arisen.

Our tax department is considering doing the following two things:

1) Treat the compensation for employees who participate in one of our research projects as income for employee services rather than subject compensation and report it on W-2s rather than 1099s.

2) Hire other subjects who are not employees as casual employees.

Their argument is that if the payor is exercising direction and control over the individual's activites, the person needs to be classified as an employee.

Has anyone ever encountered these issues before? Any comments you can provide would be helpful.

Peg Sandoe
Research Manager, Center for Neurosciences Research
Allegheny-Singer Research Institute
Pittsburgh, PA 15212

(412) 359-8973
xxxxxx@wpahs.org

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