Tax Cheats Hurt Responsible Employers

The Treasury Department says that when employers misclassify workers as independent contractors (instead of paying wages to them as employees), they save about $3,710 per worker per year in employment taxes on an annual average of $43,007 in earnings. U.S. Dep’t of Treasury, Employers Do Not Always Follow Internal Revenue Service Worker Determination Rulings (June 13, 2014), at 2, available here.  The upshot: Not only are workers shortchanged, but tax burdens weigh more heavily on responsible employers.