July 13, 2021
US Government Joins Canada & Australia In Their Crack Down On Gig & Sharing Economy Workers
“A last-minute insert by Democrats looking to offset the cost of their coronavirus aid package would send tax collectors into the gig economy, eventually costing Uber and DoorDash drivers, Airbnb hosts and others about $1 billion annually,” Roll Call reports.
Uber drivers, Etsy sellers, and others who earn income through the gig economy could get a nasty surprise from the $1.9 trillion emergency spending bill signed by President Joe Biden on Thursday.
The tightening of the reporting requirements means a lot more paperwork and tax compliance requirements for platforms
The big difference is that now the IRS will have their personal information and can go after them ….
“Workers who are underreporting their income now will become guilty of nonpayment next year and subject to penalties and actions by the agency,” Olson said.
Olson added that an IRS collection action “can destroy a person’s life,” as employers can be hesitant to hire someone with a federal tax lien and lenders won’t make loans without charging the highest interest rates.
The new $600 income-reporting threshold for gig workers is also included in the Senate’s substitute amendment to the House-passed relief bill, making it all but certain to become law.
There’s a potentially bigger issue at play for third-party networks than just the reporting threshold, however: fear of having to reclassify workers as employees, rather than independent contractors. The dreaded employee designation carries substantial new obligations, such as putting the employer on the hook for payroll taxes and benefits like health insurance.
We previously reported that Australia and Canada are focused on Gig & Sharing economy workers and the likelihood of an audit of your expenses and income has increased dramatically : https://www.linkedin.com/feed/update/urn:li:activity:6813094917930401793
Part of a global tax trend : https://www.linkedin.com/feed/update/urn:li:activity:6813094917930401793
Our original posting from 2 years ago : https://lnkd.in/e4N6NpFBack