EDD Denies Benefits Corporate Officers Who Also Serve as Employees

[jvaski]

I have a problem ......EDD Appeals Board final ruling .
In this case their tax auditor determined that because I am the officer of my Calif S-Corp - I have always been employed with "corporate officer duties at my disgression"
Therefore , they have ruled that during the year I was paid benefits and seeking work - I was actually employed !
They will be certainly furnishing me a letter of determination of overpayment with penalties ( could be at more than $20,000 )
My option is file a Writ of Mandate with Superior Court .
I have not been successful in obtaining an experienced EDD attorney and cannot find a standardized Writ of Mandate form anywhere on line .

I invite anyone who has a similar case with EDD regarding their attack on corporate officers collecting benefits to please contact me. We need to file a class-action lawsuit !

[SOCA]

I have a problem ......EDD Appeals Board final ruling .
In this case their tax auditor determined that because I am the officer of my Calif S-Corp - I have always been employed with "corporate officer duties at my disgression"
Therefore , they have ruled that during the year I was paid benefits and seeking work - I was actually employed !
They will be certainly furnishing me a letter of determination of overpayment with penalties ( could be at more than $20,000 )
My option is file a Writ of Mandate with Superior Court .
I have not been successful in obtaining an experienced EDD attorney and cannot find a standardized Writ of Mandate form anywhere on line .

I invite anyone who has a similar case with EDD regarding their attack on corporate officers collecting benefits to please contact me. We need to file a class-action lawsuit !

An EDD supervisor told me that the tax auditor dept. is primarily responsible for making sure that the employer is paying it's fair share of unemployment tax ( per claimant ). And, that they will ask the U.I. recipient for wage stubs in an effort to determine this. Is this correct ? If not, what is the real function of the tax auditor dept ? In your case, are they pursuing you because you are being viewed as an employer ?

[jvaski]

An EDD supervisor told me that the tax auditor dept. is primarily responsible for making sure that the employer is paying it's fair share of unemployment tax ( per claimant ). And, that they will ask the U.I. recipient for wage stubs in an effort to determine this. Is this correct ? If not, what is the real function of the tax auditor dept ? In your case, are they pursuing you because you are being viewed as an employer ?

No, The EDD does not like - nor do they recognize the legally seperate entities of a corporate officer and employee of the s-corporation.
As employee of the corporation I am legally required to pay into unemployment benefits - but they're saying I cannot collect it !
They have in this case purposely misintreperted their own codes to create employment where there was none - to recover benefits they approved and paid for over a year !
I can only hope the judge in the superior courtroom is non-biased as a state employee..........

[jvaski]

Interesting development .
I sent multiple demands to EDD for copies of my phone interview records etc and finally got calls from two dept managers...
After lengthy conversation .......one of them suggested that I leave a "sleeping dog lay" and likely my case is lost in the system .......
I don't trust that their tax auditing dept ever really loses anything - they just get around to it much later when they please and can charge even more interest on repayment !
I'm not sure now what the hell to do .....or whether to pursue this in Superior court or not just yet

[Cachicambo]

First, may I suggest that you change your view on EDD's intentions. While you may certainly feel attacked, EDD and it's representatives gain nothing from, "attacking" you. Also, EDD doesn't like or dislike a single thing about corporate officers, the law governing the code is based upon Precedent Benefit Decisions. Going before any judge with a "they are out to get me" attitude is one of the worst things you can do for yourself. At worst you'll look paranoid and at best extremely misinformed.

There are a couple of issues with your scenario that are not clear. Are you the sole corporate officer/owner of the corporation? In what capacity do you perform services? Did you receive any compensation for your services as an officer? Do you chose if you pay yourself? Also, employee's in California are NOT required to pay into Unemployment benefits, it's funded by the employer, through their reserve account. While you were collecting UI were you still performing services in any capacity for the corporation, wether you were compensated or not? If so, for how many hours a week.

If you want to read up a bit on the law governing this issue, read this: http://www.edd.ca.gov/uibdg/Total_an...rate%20Officer

[jvaski]

Thanks , in answer to your reply .......
I am the sole officer of my Calif S-Corp. My home building construction business literally ended in early 2008 when the final new home I built was completed. Since then - there have been absolutely no duties as a "corporate officer" to be performed - other than looking for work - either as a construction company or individual. The trigger for the tax audit is the receipt of a "delayed payment" I received as employee shortly after I began collecting benefits ( late 2008 ). This "delayed payment" was for work completed much earlier in the year when I completed my final home - and I literally insisted a phone interview with EDD to explain this -and they approved my explaination and continued payments of benefits. My corporation has a history of these "delayed payments" when a property sells and the corporation has the money to pay me as employee. This "delayed payment" obviously sent up a red flag a year later with their Tax Auditing division. EDD departments admittedly do not communicate with each other and have their own ajendas.
Their tax auditor literally then "fabricated" employment status for me after our disgussion of this "delayed payment". In short - the Tax Auditor didn't like this "delayed payment" - decided that I had corporate duties when I had none, spread this "delayed payment" over the entire year - and then had the nerve to say - " obviously because you had wages over the entire year you've been employed " ( these are the wages he elected to spread out ) It was literally a "fabrication of employment status" !!
As employee of my Calif S-Corp - I AM required as anyone else to pay into unemployment benefits when I received payment as employee. Do I choose to pay myself ? NO, technically ...... the Corporation chooses to pay me as an Employee. This is a relationship which is legally and fully understood as two seperate entities in the tax law in the state of Calif.
So, what may look like complaining (" they're out to get me" ).......is a TRUE story - and if they pull this off - they can "frame" any corporate officer they want benefits repayment from !

BTW, thanks for the link to TPU 110 , I have already read this article backwards and forwards and there are two previous test cases that are somewhat parallel to my situation. In both cases the EDD lost the case because the corporate officer was simply unempllyed beyond his control and seeking work both as corporate officer and individual.
And the EDD tax auditor used their code to spread my wages over a year - but negelcted to read the part where the code literally states " wages spread over a period of employment" which was not the case .
This EDD Tax Auditing division is corrupt.....and backed-up all the way by a biased and arrogant Appeals Board !

[jvaski]

To follow-up.....Both the EDD Tax Auditor and Appeals Board purposely mis-intrepreted their own CUIC Codes language to fabricate an "employment" status against me because they clearly do not want a Corporate Officer collecting unemployment benefits - regardless of proven "unemploymnet" status under CUIC Section 1252.
In short, You can legally be the Officer of your S-Corp , and the Sole Employee - and be "legally required" to pay into the unemployment system, but you are not eligable toe receive benefits "technically" because "YOU are alwways employed doing corporate duties for the corporation" REGARDLESS if you can prove otherwise.
The Superior court judge tentatively ruled against me before hearing my case .....and made a statement "People incorporate purely for the purposes of collecting uVigilante Maine Coons
loynent under the corporate shell" ........it is a statement that is truly as biased as it is erroneous !
I will be filing a complaint against this Superior Judge with the Calif Commission of Judicial Performance for his clearly biased statements, actions, and failure to recognize my compelling evidence presented to the court.