Costs to the community, state & country

Stop Worker Abuse Now!

Brought to you by the hard working families of the Carpenters' District Council of Kansas City and Vicinity

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Q: What are the costs to the community, state & country?

Abuse of Form 1099 is costing citizens, businesses and communities plenty. It is estimated that 20-30% including city and state taxes are lost to 1099 abuse. Greedy profiteers are pocketing money that is needed for schools, city services and social security benefits. The burdens of tax revenues lost are shouldered by those businesses whose tax and payroll practices can be more easily monitored.

Coopers & Lybrand (Now PriceWaterhouse Coopers) in their report Projection of the Loss of Federal Tax Revenue Due to Misclassification of Workers (based on IRS data), projected the following losses from misclassification:

Federal Revenue Loss From Misclassification in billions of dollars, 1996-2004
1996	1997	1998	1999	2000	2001	2002	2003	2004
2.5	3.4	3.6	3.7	3.8	4.1	4.3	4.5	4.7
Total : $34.7 Billion

	$24 Billion/yr for uncompensated hospital care (2001)
	$203.7 Million/yr unpaid unemployment taxes, for every 1% of workforce misclassification (1998)
	Estimates of misclassification and "self-employment" suggest 2.3 million construction workers will be "self-employed" by 2005, 27% of the construction workforce

"If these workers get hurt on the job, you know they are going to end up in public hospitals at taxpayers' expense."

Jim Gleason

(Director of Organizing, United Brotherhood of Carpenters, Mountain West Regional Council)

"...the gross inequity to employees, the systematic practice of inappropriate compensation dramatically impacts our state income, withholding, and unemployment tax receipts."

Mike Johanns

(Governor of Nebraska, Statement on "1099 Misclassification" June 9, 2003)

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