Abstract

http://ssrn.com/abstract=2135057
 


 



Settle Withholding by the Dollars, Not Control


Calvin H. Johnson


University of Texas at Austin - School of Law

2012

Tax Notes, p. 949, August 20, 2012
The Shelf Project, Forthcoming
U of Texas Law, Law and Econ Research Paper No. 233

Abstract:     
Current law requires withholding tax from compensation paid to employees but not to independent contractors. The current law definition of independent contractor is vague and arbitrary, with the standard using a tort standard of control. Withholding improves the efficiency of interim reports and tax collection, and increases tax compliance. Refunds improve the taxpayer’s attitude toward his government. The proposal discussed in this article would replace the employee/independent-contractor test with a bright-line rule. Withholding would be required of any employer with more than two fulltime workers. Households expected to pay more than $2,000 a month for one employee would also be required to withhold.

The proposal is offered as a part of the Shelf Project, a collaboration of tax professionals to develop proposals to raise revenue without a VAT or a rate increase. Shelf Project proposals raise revenue while making the tax system more efficient and reducing deadweight loss.

Number of Pages in PDF File: 11

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Date posted: August 25, 2012  

Suggested Citation

Johnson, Calvin H., Settle Withholding by the Dollars, Not Control (2012). Tax Notes, p. 949, August 20, 2012; The Shelf Project, Forthcoming; U of Texas Law, Law and Econ Research Paper No. 233. Available at SSRN: http://ssrn.com/abstract=2135057 or http://dx.doi.org/10.2139/ssrn.2135057

Contact Information

Calvin Harsha Johnson (Contact Author)
University of Texas at Austin - School of Law ( email )
727 East Dean Keeton Street
Austin, TX 78705
United States
512-232-1306 (Phone)
512-232-2399 (Fax)
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