As you know, there is concern in Washington, D.C., that members of Congress may consider new legislative efforts, either during this lame duck session or in the new Congress, that may limit the use of independent contractors in an attempt to reduce the budget deficit or for other reasons. We all recognize the need to get our country’s deficit under control, but we need to let Congress know that this type of effort will not solve our budget woes.
Fortunately, Representative Erik Paulsen, of Minnesota, has introduced a bill that will protect and preserve the role of independent contractors in the promotional products industry. Representative Paulsen’s bill will allow promotional products professionals to continue to run their own businesses without undue or unnecessary interference.
I have already sent a letter to Rep. Paulsen, thanking him for his support. Now I ask you to do three things:
- Join me in thanking Rep. Paulsen for his support by sending a note of thanks via email.
- Act now and email your members of Congress, asking them to support H.R. 6653, the “Independent Contractor Tax Fairness and Simplification Act of 2012.”
- Finally, please complete this five-minute survey regarding your company’s use of independent contractors. This will help us build a stronger case for protecting independent contractors going forward.
For industries in which there is a debate about whether individuals who provide services to a business are employees or independent contractors, the provision in the U.S. Tax Code known as Section 530 provides safe harbors for the use of independent contractors in industries that have traditionally engaged independent contractors, including the promotional products industry. Section 530 also prevents the Internal Revenue Service (IRS) from writing rules on how to classify individuals as independent contractors versus employees.
Without the passage of H.R. 6653, the following may happen:
• Re-classify many independent contractors as employees by the IRS
• End the use of independent contractors in the promotional products industry
• Force some independent contractors to stop running their own small businesses and start working for someone else
As always, thank you for your support and if you have any questions, please just let me know.Paul Bellantone, CAE President & CEO