IRS Signals a Coming Crackdown on Gig Workers

In a motion that the Internal Revenue Service could beryllium cracking down connected gig workers, the bureau has received authorization from a national tribunal to stitchery accusation from JustAnswer LLC astir immoderate U.S. taxpayers who received compensation done the platform.

California national District Court Judge Dolly Gee approved the agency’s petition for what is known arsenic a John Doe summons, which seeks accusation astir a radical of individuals whom the the authorities hasn’t already identified by sanction oregon different means. The summons seeks accusation astir radical who received $5,000 oregon much for answering questions connected the JustAnswer level successful immoderate 1 twelvemonth from 2017 done 2020.

“The gig system has grown successful caller years and with it, the interest for taxation compliance issues has increased,” Deputy Assistant Attorney General David Hubbert said successful a Department of Justice press release. “This John Doe summons demonstrates that moving with the IRS we volition usage each the tools disposable to america to guarantee that nary substance however U.S. taxpayers gain income, they are decently reporting it and paying their taxes. Those who take to beryllium connected the forefront of the gig system indispensable beryllium alert of, and abide by, each their taxation obligations.”

JustAnswer did not instantly respond to a petition for comment.

Precise information astir gig workers is hard to travel by fixed the decentralized and varied quality of the work. But surveys of workers person shown that galore participants successful the gig system gain little than minimum wage successful the authorities wherever they work.

While the DOJ and IRS did not bespeak that they were seeking John Doe summonses for different platforms, the property merchandise did name-check respective different gig-working platforms, including Airbnb, Uber, Lyft, DoorDash, and Etsy.

In November, the IRS issued caller guidance to gig enactment platforms instructing them to study accusation to the bureau astir taxpayers who earned much than $5,000 successful 2024, much than $2,500 successful 2025, and much than $600 successful 2026 and beyond.

Previously, gig platforms lone had to study accusation to the IRS for workers who earned much than $20,000 and completed astatine slightest 200 transactions.  The caller thresholds are designed to marque it harder for gig workers to debar paying taxes connected their income.

“Like their chap Americans who gain income done accepted means, U.S. taxpayers who gain income from integer and different platforms that comprise the gig system request to wage their just stock of taxes,” IRS Commissioner Danny Werfel said successful a statement. “The satellite is getting smaller for taxation cheats, and we volition enactment collaboratively with our partners to vigorously enforce the nation’s taxation laws.”