Thune Introduces Bill to Add Certainty to Worker Classification Rules

Statement

U.S. Sen. John Thune (R-S.D.), a member of the tax-writing Senate Finance Committee, today introduced the New Economy Works to Guarantee Independence and Growth (NEW GIG) Act of 2017 (S. 1549), legislation that addresses the classification of workers -- independent contractors versus employees -- and creates a safe harbor for those who meet a set of objective tests that would qualify them as an independent contractor, both for income and employment tax purposes. This legislation is important for traditional independent contractor arrangements, like computer consultants, freelance writers, and delivery drivers, as well as all of those individuals who participate in the gig economy and provide a rapidly growing range of services.

"Today's fast-growing "gig economy' has made it easier for people to offer unique services, like home repair and cleaning, child care, food delivery, or ride sharing, through easy-to-use mobile applications that can be opened with a simple swipe of a finger," said Thune. "While these gig economy companies have created thousands of new jobs, they've also faced new challenges when it comes to how the service providers are classified by the IRS. My legislation would provide clear rules so these freelance-style workers can work as independent contractors with the peace of mind that their tax status will be respected by the IRS."

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