Email Discusses Tests to Be Applied to Determine if Adult Companion is Employee of Service Recipient

In an email, the Chief Counsel’s office considered the employment status of an adult companion sitter (Chief Counsel Email 201633034).  The email was in regard to information to be contained in training materials, likely for either IRS agents or programs like VITA where volunteer preparers would be trained.

As the proposed training materials explain:

Companion sitters are individuals who furnish personal attendance, companionship, or household care services to children or to individuals who are elderly or disabled.

The advice concluded that the standard common law factors would be applied to determine whether the companion was or was not an employee of the recipient of the services.  The memo suggests that the training materials have the following sentence added:

However, a sitter not affiliated with a companion sitting placement service may be considered to be an employee of the individual for whom the sitting is performed, depending on whether the individual for whom the sitting is performed has the right to direct and control the sitter.

The training materials provide that a companion placement service will not necessarily be the employer, noting:

A person engaged in the trade or business of putting the sitters in touch with individuals who wish to employ them (that is, a companion sitting placement service) will not be treated as the employer of the sitters if that person does not receive or pay the salary or wages of the sitters and is compensated by the sitters or the persons who employ them on a fee basis.

The materials are simply providing the special rule found in IRC §3506 regarding individuals providing companion sitting services, with the above very closely paraphrasing §3506(a).

The training materials then go on to note “Companion sitters who are not employees of a companion sitting placement service are generally treated as self-employed for all federal tax purposes.”  Following that sentence is where the National Office attorney suggests adding the possibility that the companion could be an employee of the service recipient.