BobKamman
Level 15
10-19-2021
02:09 PM
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What does the employment contract say?
"For every dollar of outside income, your salary is reduced", or
"We will always pay your full salary, but you have to turn over every dollar of outside income." ?
If he gets to keep the Schedule C income but his salary is reduced, it's a simple problem. He qualifies for a refund of FICA and Medicare taxes paid on the salary.
Were there any years where outside income exceeded salary? Would he have had to pay back more than his W-2 compensation?
First step would be to read the employment contract.