Morris E. George, Petitioner

-T .C . Sum ary Opinion 2009-7 9 l

UNITED STATES TAX COURT

MORRIS E . 'GEORGE,, Petitioner v . COMMISSIONER' OF INTERNAL REVENUE,, Responden t Docket No . 16522-07S .

Filed May 19, 2009 :

Morris E . George, pro se .

{ Kathleen K . Raup , for respondent .

{ GOLDBERG, Special Trial Judge :

This case was heard pursuant fi to the provisions of section 7463 of thee Internal Revenue Code ; i n effect at the .time the petition was filed . Pursuant to section .

7463( b), the decision to belentered is not reviewable by any other court, and this opinion shall' not be treated as precedent ; for any other case . Unless otherwise indicated, subsequen t section references are to the Internal Revenue Code in effect for

RUED MAY 19 Z

the year in issue, and all Rule references are to the Tax Court Rules of ' Practice and Procedure .

The issue for decision is whether , petitioner is liable fo r self-employment tax on $20,794 he received from Staffing Plus, Inc ., in 2003 .1 Background Some of the facts have been stipulated and are so found .

The, stipulation of facts and the attached exhibits ar e incorporated herein by this reference . At the time petitioner .

filed" petition , he resided in Pennsylvania.

During 2003 petitioner attended Winchester , University while ;working as a self - employed social worker counseling children wit h behavior problems .

He graduated in 2006 with a degree i n sociiology .

During 2003 petitioner also worked at three part-tim e ~I jobs .

~ ' :The sole income in dispute is$20 , 974 he received from ,Staffing,-Plus, Inc .

( Staffing Plus ) .

;, Staffing Plus contracted with school districts to provide social workers and under this arrangement assigned petitioner to various schools to provide counseling .

Petitioner did not receive vacation time or sick leave !{!, from either Staffing Plus or the school districts .

'The notice of deficiency included a sec . 6651(a)(1) addition to tax for failure to file ( late filing of) the 2003 Federal'income tax return . addition in his petition or at trial . Therefore , petitioner is deemed to have conceded the issue . See Rule 34 ( b)(4) ;,, Swain v . Commissioner , 118 T .C . 358 , 364-365 ( 2002) .

Petitioner did not dispute the - 3'.

Staffing Plus reported the $20,974 on Form 1099-MISC , Miscellaneous Income . On June 14, 2006, petitioner filed hi i s 2003 Federal income tax return reporting wages of $3,644 from,1hi s three part-time jobs but omitting the $20,974 he received from '% Staffing Plus . In a(cid:127)letter dated July 6, 2006, the Internal Revenue Service notified petitioner that he had failed to . report the $20,974 in income . OnlJuly 14, 2006, petitioner filed a second Form 1040(cid:127), U .S . Individual 'Income Tax Return, for 2003t !

, reporting the $20,974 from Staffing Plus as "Other income" on line 21 of the Form 1040, but he did not compute self-employment ' tax .

Respondent issued a notice of,deficiency dated May 24 2007, determining an increase in Federal'income tax of $2,964 based on petitioner's failure to report self-employment tax on the,$20, ; .74 and other related computational- adjustments and a $(cid:127)712 .5 0 addition to tax under section 6651(a)(1) for petitioner's failur e to timely file his 2003 tax return .!

Discussion In general, the Commissioner's ' determination set forth in' :ao notice of deficiency is presumed correct ; and the taxpayer bears the burden of showing that the determination is in error .

Rule i 142(a)(1) ; Welch v . Helverinl , 290 U .S . 111, 115 (1933) . Under' section 7491(a), the burden may shift to the Commissioner regarding factual matters ifithe taxpayer produces credible evidence and meets .the other requirements of the section . L Petitioner did not argue for a burden shift, and he did not fulfill the requirements of section 7491(a) ; therefore, th e burden,iremains with him . With respect to the addition to tax I II under section 6651(a) .(l), section 7491(c) places the burden of production on the Commissioner .

Section 1401 imposes a tax on self-employment income for old age, survivors, disability insurance, and .hospital insurance .

Sec . 1401'(a) and (b) ; sec . 1 .1401-1(a), Income Tax Regs . 4 Petitioner's liability for self-employment tax therefore turns-on whether he had self-employment income .

Services performed as an independent contractor give rise to self-employment income . See sec . 1402(c)(2) and (3) ; Jackson v .

Commissioner , 108 T .C . 130, 133-134 (1997) . Initially,'we rea d ,the petition as raising the issue of whether petitioners is subject to self-employment tax . Petitioner implies that he is an employee and not an independent contractor . However, the following reasons leave no doubt that petitioner was an independent contractor during 2003 when he received the $20,974 .

° ;E,Fir'st, petitioner acknowledged to respondent in a discussion before trial . that the $20,794 from Staffing Plus was properly categorized as "Other income" unlike the compensation received from the three part-time jobs which he reported as wages .

Second, petitioner conceded in the stipulation of facts and on record that he was an independent contractor . Third, Staffing Plus reported the $20,974 on a Form 1099 - MISC and not on a Form W-2, Wage and Tax Statement .

Petitioner's sole argument at trial was that he was unab l to pay .the self-employmentltax because he had to pay colleg e expenses, medical bills, and other personal expenses . The statute simply does not provide an exception for inability t i pay . The statute imposes self-employment tax on taxpayers with ] E net earnings from self-empil oymentiof $400 or more . Sec .

1402(b)(2) . Accordingly, f or the foregoing reasons, we sustai n { respondent's determination ,that petitioner is subject to self- employment tax .

To reflect our disposition of ; the issue , Decision will be enter.ed ':

for respondent .