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Enyart criticizes Plummer for not paying campaign worker payroll taxes

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* From a press release…

According to Federal Election Committee reports, Congressional candidate Jason Plummer is evading payroll taxes and shifting Medicare and Social Security tax burden onto his employees. Plummer is intentionally misclassifying his campaign employees as independent contractors to skirt payroll taxes – a loophole forbidden by the IRS.

Major General (retired) Bill Enyart and International Brotherhood of Electrical Workers Local 649 Official Alan Rubenstein today slammed Plummer for evading payroll taxes in his campaign and for looking out for himself at the expense of Southern Illinois workers and middle class families.

Enyart shared his background as a UAW member working the line at Caterpillar with his father as a young man. He criticized Plummer for trying to cheat workers by evading payroll taxes in his campaign and running on a platform that rewards millionaires, but puts good jobs and the future of Southern Illinois for regular working people at risk.

Enyart said: “In direct violation of the law, my millionaire opponent is paying no payroll taxes on his campaign. Instead he’s misclassifying his workers, forcing them to pay the full tax burden while he pays nothing at all in payroll taxes. This is only a preview of what Mr. Plummer would do in Washington. He will shift the burden onto the middle class by raising taxes on regular working people, but giving himself a new tax break.”

* There has been some dispute in other races about whether this is legal. But others have done it. For instance, this is from 2010

Almost across the board in major races for governor, U.S. senator and Congress, Democratic candidates have put their campaign workers — at least some of them — on the payroll and have been paying FICA and other taxes on them.

But not Republicans. Though some now say they’re changing, they’ve followed a different approach, treating all of their campaign managers, press aides and the like as independent contractors, which makes the individual and not the “employer” responsible for any tax liability. […]

In the race for Illinois governor, during the last six months of 2009 — the latest for which figures are available — Mr. Quinn’s campaign reported paying $52,000 to the IRS and another $5,200 to the Illinois Department of Revenue for payroll taxes. That’s money Mr. Quinn surely could have used for other purposes, like TV ads.

The GOP nominee, state Sen. Bill Brady, reported no such payments. Which means that folks who made as much as $12,500 in the last half of the year worked for his campaign on “consulting” or “contractual services,” as Mr. Brady’s state disclosure put it.

Brady ended up putting people on the formal payroll after that appeared.

* By the way, Enyart’s press release contains another “revelation”…

[International Brotherhood of Electrical Workers Local 649 Official Alan Rubenstein] was part of a group of local workers who questioned Plummer’s business practice of personally profiting by undercutting a living wage for his employees. He also slammed Plummer for refusing to listen to Southern Illinois workers without an endorsement.

“Jason Plummer is a millionaire who has been taking advantage of the tough economy by undercutting labor and middle class and working people. Mr. Plummer personally profits by keeping wages low and if he had his way, they’d be so low no one could support their families and earn a decent, honest living.

“Mr. Plummer had the nerve to tell me that he’d only listen to Southern Illinois workers if we endorsed him. Well that’s not how honest people do business.”

posted by Rich Miller
Friday, Oct 26, 12 @ 2:09 pm

Comments

  1. Jason, Jason, Jason. Like father like son, huh?Every person I’ve ever spoken with who has had business dealings with the Plummer family business, RP Lumber, have disparaged them for being shady. Now Jason’s campaign too? Oswego Willy’s broadside of the Little Plummer Boy in 3…2…1…

    Comment by Oh Yeah Friday, Oct 26, 12 @ 2:22 pm

  2. @FakeJasonPlummer - I am going to hold my breath until everyone stops saying the word “taxes”. All Taxes! That is my Dad’s job not mine! #StopAskingMeQuestionsThatMakeMeLookBad

    Comment by Oswego Willy Friday, Oct 26, 12 @ 2:29 pm

  3. Absolutely legal. And for many of the low-paid workers on any campaign who would probably get a refund sometime early next year, it keeps money in their pocket and not Uncle Sam’s.

    Comment by Joe Schmoe Friday, Oct 26, 12 @ 2:31 pm

  4. –And for many of the low-paid workers on any campaign who would probably get a refund sometime early next year, it keeps money in their pocket and not Uncle Sam’s.–

    Not sure what you mean. They’re on the hook for the full boat of payroll taxes through the self-employment tax.

    Being an independent contractor is a good gig if you can charge a very hefty premium for giving an employer flexibility, as well as no costs for payroll taxes, health insurance, 401K, profit-sharing, etc.

    It’s definitely not a sweet deal if the workers are low-paid. They’re getting hosed.

    Comment by wordslinger Friday, Oct 26, 12 @ 2:48 pm

  5. Yeah, I don’t think this is unusual at all for a campaign….

    Also don’t know what taxes anyone gets out of? Still have to share that 1099 info with the IRS.

    Comment by OneMan Friday, Oct 26, 12 @ 2:50 pm

  6. ===Also don’t know what taxes anyone gets out of?===

    Plummer’s campaign gets out of paying employer taxes and social security (employer’s share) of taxes. The “independent contractor” has to pay both the employer and employee shares, although he or she can deduct half of the social security tax.

    As always, the government gets paid either way, but in this instance, Plummer’s campaign saves a few bucks. And to be fair, I’ve been paid this way many times before. And it sucks, since you typically lose about 25% of your wages right off the top to taxes and it makes filing taxes a real pain in the rear.

    Comment by 47th Ward Friday, Oct 26, 12 @ 3:04 pm

  7. –Also don’t know what taxes anyone gets out of?–

    The employer gets out of their share of payroll taxes.

    Comment by wordslinger Friday, Oct 26, 12 @ 3:08 pm

  8. I’m not a lawyer, but my understanding is that there is a test to determine whether a person can be considered an independent contractor. If they work out of Plummer’s campaign office and are expected to perform certain duties within a specified time frame, they probably can’t be classified as independent contractors. It’s about how much control the employer has and how much direction the employer is giving.

    Classifying someone as an independent contractor typically lowers the financial obligations of the employer but also tends to limit his liabilities. For instance, if the person causes a car accident, does the campaign have responsibility for sending that person on that trip, or does the liability fall squarely with the individual since he’s an independent contractor.

    It also tends to reduce the employer’s accounting expenses. It’s definitely a way for the employer to look out for himself and to let the employees, ahem, independent contractors, fend for themselves. My expectation is that it is illegal because the workers are taking direction from Plummer and working out of his campaign office. Mr. Enyart is a lawyer, so I’d defer to him on it.

    Comment by David Friday, Oct 26, 12 @ 3:19 pm

  9. At least he is paying his campaign workers, unlike Mike Boland who was sued over NOT paying them at all.

    Comment by Lil Enchilada Friday, Oct 26, 12 @ 3:20 pm

  10. – The employer gets out of their share of payroll taxes. –

    The 1099 employee covers that instead, so the Feds, the state, etc all get their cut. Also having been paid that way before I can say (and I do my own taxes with software) it does not make your taxes that much harder to do (adds about 15 minutes to the process).

    Comment by OneMan Friday, Oct 26, 12 @ 3:25 pm

  11. I’m not even a Republican and I think Enyart’s complaint about payroll taxes is ridiculous.

    Comment by Brendan Friday, Oct 26, 12 @ 3:32 pm

  12. –The 1099 employee covers that instead, so the Feds, the state, etc all get their cut.–

    Got it. The point is, it’s a way for the employer to transfer a liability to the employee.

    Comment by wordslinger Friday, Oct 26, 12 @ 3:34 pm

  13. I’ve been paid this way before by both R (2004) and D (2010)campaigns. In my case, I can verify Joe Schmoe is right, I had a deduction coming and it gave me necessary liquidity at the time.

    I was also supporting my family of four on $600/wk, which gives you an idea of the level of compensation we’re talking about here. If I were to take a similarly paid job now in addition to my regular job, it would mess with my tax bill something fierce, but the filing is pretty simple with TurboTax.

    Comment by Colossus Friday, Oct 26, 12 @ 3:50 pm

  14. ===At least he is paying his campaign workers, unlike Mike Boland who was sued over NOT paying them at all. ===
    So are you saying that it doesn’t matter that he’s placing his tax burden on his underpaid workers’ shoulders because other people have done worse?

    Campaign workers are not paid much to begin with. The fact that he apparently has no qualms about making life more difficult for the very people helping him get elected makes me worry about how he would treat the average voter if elected.

    Comment by Moose Friday, Oct 26, 12 @ 3:55 pm

  15. Word, is it unethical? Nah, probably not. Is it worth creating an opposition ad about, sure. Comes with the territory. Though it’s getting tiresome when posters who, when Plummer gets mentions, feel the need to post insults without much creativity. Oh right, comes with the territory.

    Comment by Bitterman Friday, Oct 26, 12 @ 3:58 pm

  16. I don’t get it.

    I’ve been on several campaigns and have been classified as an independent contractor for every one except once.

    Thought it was standard procedure. It’s generally somewhat short term, somewhat high turnover depending on the position. It seems like the reasonable thing to do…

    Comment by Anon Friday, Oct 26, 12 @ 4:06 pm

  17. So is there an anti-Plummer ad yet just focusing on the Plummer tax issues.

    NARRATOR:
    Now we know why shady millionaire Jason Plummer has refused to release ANY tax returns.

    –Plummer evaded payroll taxes

    –Plummer was late on property taxes

    –Plummer claims a primary residence tax exemption OUTSIDE THE DISTRICT.

    –Plummer supports eliminating the estate tax for sons of millionaires like himself, but won’t say what middle class tax deductions he’ll cut to pay for it.

    If Jason Plummer has this much trouble explaining his own taxes, can you trust him in Congress with yours?

    The HisGirlFriday PAC was responsible for this ad.

    Comment by hisgirlfriday Friday, Oct 26, 12 @ 4:12 pm

  18. I got paid that way on campaigns in the past too. Also keep in mind that most of these workers are working for the campaign for pretty short times… typically a year, six months, or less.

    Comment by Just Observing Friday, Oct 26, 12 @ 4:14 pm

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