Re: IRS regulations in business

Abraham Moses Genen (
Tue, 22 Jul 1997 20:44:08 -0400

Abraham Moses Genen
Being dedicated to the future progress of humankind
should be the prime concern of all civilized beings.

From: Andrea Gallagher <>
Subject: Re: IRS regulations in business
Date: Monday, July 21, 1997 10:05 PM

[Andrea decides to see if there's a useful conversation in this thread,
before Perry explodes upon realizing that this is someone who helps write
"consumer protection" laws for New York.]

Abraham Moses Genen wrote:
>During my service to the US Congress I was involved in drafting and/or
>analyzing several thousand pieces of legislation that effected and
>(hopefully) helped to advance the cause of social evolution.
>Possibly, part of the problem is that almost no one outside of a few
>professionals are aware how much legislation is introduced in the House
>and Senate any given term. Much of what is drafted, amended and passed is
>quite technical and, unfortunately, quite complex and arcane.

I suspect this is true, and that is part of the problem that so many on
this list have with these regulations. Why don't we take the IRS rules
about contractors as one example? You said to Perry that we could
comfortably expect these regulations to adapt to suit organizations as
change. In fact, the IRS tightened the rules for when you can call
a contractor just as many companies have started to use contracting
heavily. I have been asked by firms, for whom I believed I was clearly
contracting, if I would please sign on as a temporary employee just to
avoid IRS issues.

If contract relationships are the wave of the future, why is the IRS
it so difficult to operate this way? It's relatively easy to explain if
you take a public choice approach and assume that the IRS wants to
it's revenue and power with little regard to the effect on the economy.
How would you interpret the situation?


Dear Andrea and other fellow Extropians:

It seems that the IRS regulations as it relates to independent contractors
is as complex as it is because of the abuse of the independent contractors
provisions by many small, virtual (and fly-by-night) organizations.

Particularly, I've found that a large number of sales and migrant farm
organizations tend to improperly hire young people as independent
contractors in order to avoid many labor regulations. In an inordinately
large number of incidents these young and quite unsophisticated people are
exploited and ultimately abandoned without any assets by these
unscrupulous companys throughout the country. Regrettably, the US
Department of Labor and the IRS lack the staffing to prevent most of these
horrible (approaching slavery) human rights abuses.

As with many things the reality is far more complex and brutal than the
ideal and the theory.

Think about it some more.