Working Paper: NBER ID: w31273
Authors: Andrew Garin; Emilie Jackson; Dmitri K. Koustas; Alicia Miller
Abstract: We document the dynamics of tax-based measures of work mediated by online platforms from 2012 through 2021. We present a measurement framework to account for high reporting thresholds on some information returns using returns from states with lower reporting thresholds to provide a more complete estimate of total platform work. Updating data through 2021 allows us to provide the most comprehensive estimates of the COVID-19 pandemic on tax filing behavior. We find that the number of workers receiving information returns not subject to the 1099-K gap increased dramatically during the pandemic, with least 5 million individuals receiving information returns from platform gig work by 2021, nearly all from transportation platforms. We present evidence that the availability of expanded unemployment insurance benefits resulted in many individuals who were platform workers in 2019 not reporting any self-employment income in 2020-2021. At the same time, other services done by platform gig workers increased dramatically by at least 3.1 million people between 2019 and 2021. Interestingly, the broader 1099-contract economy follows a different trend, declining during this period, suggesting the challenges for tax administration are largely concentrated among platform gig workers, at least through 2021.
Keywords: platform gig work; tax reporting; COVID-19; unemployment insurance
JEL Codes: H24; J21; J41; J46; M13; Y1
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| availability of pandemic unemployment assistance (PUA) (J65) | reporting of self-employment income (H24) |
| expanded unemployment insurance benefits (J65) | significant number of platform workers not reporting self-employment income (J46) |
| introduction of expanded unemployment insurance benefits (J65) | shift in the nature of gig work (D26) |
| number of workers receiving information returns not subject to the 1099-K gap (H24) | increase during the pandemic (F69) |
| broader 1099 contract economy (D26) | decline during the pandemic (F44) |