Specific Instructions

Line 2. Employer Identification Number (EIN)

Enter the taxpayer’s EIN. If the taxpayer does not have an EIN, the taxpayer must apply for one. An EIN can be applied for in one of the following ways.

  • Clicking the EIN link at www.irs.gov/businesses/small. The EIN is issued immediately once the application information is validated.

  • Faxing or mailing Form SS-4, Application for Employer Identification Number.

The taxpayer must have received an EIN by the time Form 8952 is filed for the form to be processed. For more information about EINs, see Publication 1635, Understanding Your EIN.

Line 10

Check the box that applies. If you are not a member of an affiliated group, you can skip lines 11-14.

An affiliated group is one or more chains of includible corporations (section 1504(a)) connected through stock ownership with a common parent corporation. The common parent must be an includible corporation and the following requirements must be met.

  • The common parent must own directly stock that represents at least 80% of the total voting power and at least 80% of the total value of the stock of at least one of the other includible corporations.

  • Stock that represents at least 80% of the total voting power and at least 80% of the total value of the stock of each of the other corporations (except for the common parent) must be owned directly by one or more of the other includible corporations.

For this purpose, the term “stock” generally does not include any stock that (a) is nonvoting, (b) is nonconvertible, (c) is limited and preferred as to dividends and does not participate significantly in corporate growth, and (d) has redemption and liquidation rights that do not exceed the issue price of the stock (except for a reasonable redemption or liquidation premium). See section 1504(a)(4).

Part II. Contact Person

The contact person is the person the IRS may contact if there is an issue with the application. If the contact person does not have legal authority to bind the taxpayer, the taxpayer must attach to Form 8952 a properly executed Form 2848.  
 
Special instructions for Form 2848. On Form 2848, line 3, enter “Voluntary Classification Settlement Program” as the type of tax. Leave the entry spaces for Tax Form Number and for Year(s) or Period(s) blank. Check the box on Form 2848, line 4.

Line 15

For the workers from all classes to be reclassified (shown on line 15), attach a statement listing their names and corresponding social security numbers.

Line 16

If more space is needed, attach separate sheets. Enter the taxpayer's name and EIN at the top of each sheet.

Line 17

Enter the beginning date of the employment tax period (calendar year or quarter) for which you want to begin treating the class or classes of workers as employees. To allow the IRS time to process your application, this date should be at least 60 days after the date you file Form 8952.

The IRS will make every effort to process Form 8952 with sufficient time to allow for the voluntary reclassification on the requested date.

Example.

If you want to begin treating a class or classes of workers as employees for the first quarter of 2015, you will enter January 1, 2015. In this case, you should file Form 8952 as soon as possible.

If you want to begin treating a class or classes of workers as employees for the fourth quarter of 2015, you will enter October 1, 2015. In this case you should file Form 8952 at least 60 days before October 1, 2015, or by August 2, 2015.

Part IV. Payment Calculation Using Section 3509(a) RatesLine 18

Enter total compensation paid in the most recently completed calendar year to all workers to be reclassified.

Nonemployee compensation of $600 or more can generally be found reported in box 7 of the Form 1099-MISC, Miscellaneous Income, filed for the worker for the most recently completed calendar year. See the instructions for box 7 of Form 1099-MISC for details.

Line 20

The social security wage base is applied on an employee by employee basis. The social security wage base for calendar year 2013 was $113,700. The social security wage base for calendar year 2014 is $117,000. The social security wage base for calendar year 2015 will be $118,500.

Example.

A taxpayer filing Form 8952 in December of 2014 with one worker would look to compensation paid to the worker in 2013 because 2013 is the most recently completed calendar year. If the worker received $125,000 in compensation in 2013, the taxpayer would subtract $113,700 from $125,000 and enter $11,300 on line 20.

Line 24

Multiply the amount on line 23 by 10% (.10). This is the amount required to be paid upon IRS acceptance of your application and execution of your VCSP closing agreement. DO NOT send payment with Form 8952. You will submit payment later with a signed closing agreement. If you submit payment with Form 8952, it may cause a processing delay.

Paid Preparer Use Only

A paid preparer must sign Form 8952 and provide the information in the Paid Preparer Use Only section at the end of the form if the preparer was paid to prepare the form and is not an employee of the filing entity. The preparer must give you a copy of the form in addition to the copy to be filed with the IRS.

If you are a paid preparer, enter your Preparer Tax Identification Number (PTIN) in the space provided. If you work for a tax preparation firm, you must also enter the firm’s name, address, and EIN. However, you cannot use the PTIN of the tax preparation firm in place of your PTIN.

You can apply for a PTIN online or by filing Form W-12, IRS Paid Preparer Tax Identification Number (PTIN) Application and Renewal. For more information about applying for a PTIN online, visit www.irs.gov/ptin.

Generally, do not complete this section if you are filing the form as a reporting agent and have a valid Form 8655, Reporting Agent Authorization, on file with the IRS. However, a reporting agent must complete this section if the reporting agent offered legal advice, for example, advising the client on determining whether its workers are employees or independent contractors for federal tax purposes.


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