Legal Question in Employment Law in Tennessee

Pay back of draw

I was on a draw against commission plan spelled out in an employment contract that states I have to pay the draw back if I leave for any reason. I was terminated last year due to the economy and lack of business. I have started to pay the draw back in monthly payments. However, my W2 shows the entire draw as ''Wages and Compensation'' which I now have to pay taxes on. Is this legal? Isn't it now a ''loan'' not wages? Should I pursue this?


Asked on 2/01/02, 10:44 am

1 Answer from Attorneys
James R. Becker, Jr. Becker Law Firm

Re: Pay back of draw

What you have described is a loan and probably not properly characterized as commissions. However, inasmuch as a part of this is a tax issue, you either need to speak with an attorney conversant in both employment and tax issues or an attorney who handles primarily employment issues with someone to provide technical guidance on the tax issues.

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Answered on 2/01/02, 11:22 am


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