Tax Liability for Wage Theft

Sachin S. Pandya
Additional contact information
Sachin S. Pandya: University of Connecticut

No 7qxv4_v1, LawArchive from Center for Open Science

Abstract: This paper shows how, under existing tax law, illegal wage underpayment by an employer (sometimes called “wage theft”) may generate employer tax liability for unreported income or disallowed business expense deductions. Given that the tax authority needs information from the underpaid worker to prove such liability, the paper identifies two ways that a worker can transmit that information to a tax authority: becoming a tax informant, or bringing a qui tam action under a state false claims act. Finally, the paper discusses possible influences on the decision of the unpaid worker to inform on the employer to the tax authority, and considers the conditions under which a tax authority is likely to audit an employer based on such information. In so doing, the paper identifies a new approach to combating wage theft and an undiscovered implication of basic income tax law.

Date: 2018-11-17
References: Add references at CitEc
Citations:

Downloads: (external link)
https://osf.io/download/5bf050491df5e7001ae56dcf/

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:osf:lawarc:7qxv4_v1

DOI: 10.31219/osf.io/7qxv4_v1

Access Statistics for this paper

More papers in LawArchive from Center for Open Science
Bibliographic data for series maintained by OSF ().