7 ms·

Aren't employers in most jurisdictions required to verify work eligibility and report income? Does "pseudonymously" just mean that they these employers commit

Aren't employers in most jurisdictions required to verify work eligibility and report income? Does "pseudonymously" just mean that they these employers commit to supporting your alternative identity when engaging with the public, the way publishers might handle a pen name? Or is this something different? I'm probably not the only person who will wonder about this, so it might help to put the answer as text on the site. (Maybe it's explained in the video, but a 30 minute video is a big ask)

that_guy_iain 4y ago
I would suspect you would not be considered an employee but a contractor. I am not sure how they much they're required to report about their vendors.
- swatcoder 4y ago
  In the US and comparable jurisdictions, the concept of employee and contractor are not interchangeable and imply differences in things like autonomy and expectations. This is as much to make sure that workers have appropriate protections and that contractors have appropriate freedom as it is about tax reporting or whatever. Far more likely is that these companies aren't well-footed legally and don't realize that they'll only be able to stay under the radar while small. Which is common, but puts a cap on how high-profile they can grow. They'll need to sort things out before they can scale or get involved in regulated industries.
  - jokethrowaway 4y ago
    It's highly debatable and jurisdiction dependant. Plenty of contractors are basically employees paying less taxes and not having holidays. (not that I'm complaining, I'm glad there is a legal way to minimise how much the government steals from me) States are a bit trickier because healthcare is so ridiculously overpriced and therefore people value health insurance provided by an employer. I never even bothered to sign up for the private health insurance I had in the UK and just either user the crappy public one or paid out of pocket, finding the best doctor for the job (instead of what my insurance would have offered).
- coderintherye 4y ago
  In the U.S. at least, you are still legally required to report the legal identity of any contractor to the IRS and must ask them to fill out an I-9 form: https://www.uscis.gov/i-9-central/complete-and-correct-form-i-9 https://www.uscis.gov/i-9-central/complete-and-correct-form-... Any contractor making >= $600 have to fill the payment and they receive a 1099. There are very few exceptions to that and they are listed in the article.
  - varsketiz 4y ago
    Thats interesting. I have contracted with multiple entities in the US for many years and they never asked for anything like that.
    - jimmygrapes 4y ago
      I think what they meant to say is the legal entity, rather than identity; a LLC or other business formation should suffice for most reporting requirements. There may be some exceptions in some areas, but I've contracted with with thousands of entities and never once had to verify the identity of their employees unless it was for individual access (passes/badges, etc.).
      - whynotkeithberg 4y ago
        So basically any real job?
    - shrubble 4y ago
      If you are located outside of the USA then they are not required to gather this info. However if they believe you are a USA citizen or reside in the USA while doing the work, then they are supposed to.
  - mgkimsal 4y ago
    (not from the article) but from a quick google search... "businesses that contract with S Corps do not need to issue them a Form 1099-MISC" I'm an s-corp, and yet I still have people 1099ing me. It's more annoying than anything because I get all my tax stuff done quickly, and someone will send out a late 1099 with slightly different numbers (typically error on their end) and... I've just given up caring about that. "You don't send 1099s to your landscaping service, or your office supply store purchases, or the energy company, but you've contracted services with them." "Oh, but you're a person"... with an s-corp registered for 10+ years and a separate employer TIN.
- deleted 4y ago
  [deleted]
- wongarsu 4y ago
  In Europe you'd get issues with accounting, both in terms of figuring out value added tax, in terms of your local tax authority asking uncomfortable questions why you have expenses without valid invoices (and yes, an invoice has to show who is invoicing). The first probably isn't an issue in the US, I'm not sure about the second. You could try to set up a company to hide your identity, but how well that works depends on the jurisdiction (in many places it's trivial to figure out the director of a company).
- PeterisP 4y ago
  It's not an arbitrary choice whether to treat a particular interaction as an employee or as a contractor - the nuances are a bit tricky, but in general it's prohibited to treat it as contracting if it isn't actual contracting but if someone is working what we'd call a standard full time job at a company. The obvious way (mentioned elsewhere here) is that you can reasonably provide services as a business - non-anonymously, non-pseudonymously, disclosing the exact legal identity of your shell company instead of your personal details.
  - that_guy_iain 4y ago
    > It's not an arbitrary choice whether to treat a particular interaction as an employee or as a contractor - the nuances are a bit tricky, but in general it's prohibited to treat it as contracting if it isn't actual contracting but if someone is working what we'd call a standard full time job at a company. Yea, but I suspect these are all going to be remote jobs with people in other countries at which point they're all contractors. It's only people in the same country as the company since generally the thing they're trying to avoid is tax evasion and they don't care if they can't tax you.
  - cma 4y ago
    Just to underline non-anonymously: https://corpgov.law.harvard.edu/2021/02/04/the-end-of-the-anonymous-shell-company-in-the-united-states https://corpgov.law.harvard.edu/2021/02/04/the-end-of-the-an... Owners can no longer hide their identity with a shell company after a recent law.
morley 4y ago
I remember reading in the last year about one of the crypto companies that hired an anonymous employee. (Maybe it was the Zcash Foundation? I can't for the life of me find the article about what they did.) Basically, they kept as low as possible the number of people who knew their real identity. That person or persons would verify employment and file the appropriate paperwork.
- 0xPersona 4y ago
  Yes! And I think that's an important point to consider. Personally I think of "anon friendly" as existing on a spectrum. Organizations offer various degrees of it. Some "anon friendly lite" organizations will allow you to work pseudonymously, the entire organization doesn't need to know your legal identity, but certain personnel (like execs/HR) will. On the other end of the spectrum are organizations that offer "full anon friendly" where they don't request any information about your legal identity.
  - judge2020 4y ago
    > On the other end of the spectrum are organizations that offer "full anon friendly" where they don't request any information about your legal identity. Have an example, besides jobs that are completely in-person and pay is done in cash/without government reporting?
    - deleted 4y ago
      [deleted]
  - gnulinux 4y ago
    > On the other end of the spectrum are organizations that offer "full anon friendly" where they don't request any information about your legal identity. I don't think that'd be legal in the US. Employer has to at least verify that the person is allowed to work in the US (i.e. a citizen, permanent resident, or a legal alien with some work visa) which requires revealing employee's true identity to HR. Or do you think there is a way to perform this (and other tax regulations) without HR knowing the identity of the person?
AtlasBarfed 4y ago
Do offshoring / outsourcing companies need to report India/whereever worker IDs?
- bencollier49 4y ago
  No, but if the endpoint worker was from the source country (not the outsourced country), then the arrangement would fall foul of anti-tax-evasion legislation in most countries.
pjc50 4y ago
Certainly in the UK you're required to do both, and in most cases that will involve your passport or biometric residence permit. I have trouble seeing why a company would contract with a party they can't sue in the event of non-performance, unless they're a much cheaper/better option.
- ghaff 4y ago
  Even for small freelance jobs in the US, I've always had to provide a social security number to get paid. Sure, as an individual, I could pay you some amount of cash under the table but a company can't really legitimately do that. As others have said, that doesn't mean you can't go by a "pen name" if you like assuming the company is reasonably flexible with email addresses, employee directories, etc.
chias 4y ago
I also have some more questions, such as: * how do you provide me with health insurance and other governmental benefits? * for the purposes of anything official, am I as an individual technically unemployed? * how do you provide me with retirement options such as a 401k? * how do you report on my earnings to the IRS?
- deleted 4y ago
  [deleted]
- Canada 4y ago
  The buyer of your labor could pay your health insurance directly, or reimburse you for it. For the purposes of anything official, you are unemployed. You would not get any retirement options. Your earnings would not be reported to the IRS. Your government could say it's illegal to receive money under these circumstances, and they basically do. But think about what that means.
  - cguess 4y ago
    > Your government could say it's illegal to receive money under these circumstances, and they basically do. But think about what that means. That you're committing tax fraud and will probably spend a non-trivial amount of time in prison for tax avoidance as well as having a significant portion of property seized to pay back taxes?
    - throwaway81523 4y ago
      If you report the income and pay the tax, there isn't tax fraud afaict. Eligibility verification if the work is in the US might be a different matter.
  - woodruffw 4y ago
    > For the purposes of anything official, you are unemployed. You would not get any retirement options. Your earnings would not be reported to the IRS. That's called "job fraud," and it's a crime in most countries.
L0stRegulator 4y ago
Let's not forget OFAC lists, anti money laundering laws and FATCA requirements. These are driven primarily from the USA but the penalties are felt globally. Your employer likely has to get all your details to ensure you can get legally paid, otherwise they may be severely penalized.

that_guy_iain 4y ago

I would suspect you would not be considered an employee but a contractor. I am not sure how they much they're required to report about their vendors.

swatcoder 4y ago
In the US and comparable jurisdictions, the concept of employee and contractor are not interchangeable and imply differences in things like autonomy and expectations. This is as much to make sure that workers have appropriate protections and that contractors have appropriate freedom as it is about tax reporting or whatever. Far more likely is that these companies aren't well-footed legally and don't realize that they'll only be able to stay under the radar while small. Which is common, but puts a cap on how high-profile they can grow. They'll need to sort things out before they can scale or get involved in regulated industries.
- jokethrowaway 4y ago
  It's highly debatable and jurisdiction dependant. Plenty of contractors are basically employees paying less taxes and not having holidays. (not that I'm complaining, I'm glad there is a legal way to minimise how much the government steals from me) States are a bit trickier because healthcare is so ridiculously overpriced and therefore people value health insurance provided by an employer. I never even bothered to sign up for the private health insurance I had in the UK and just either user the crappy public one or paid out of pocket, finding the best doctor for the job (instead of what my insurance would have offered).
coderintherye 4y ago
In the U.S. at least, you are still legally required to report the legal identity of any contractor to the IRS and must ask them to fill out an I-9 form: https://www.uscis.gov/i-9-central/complete-and-correct-form-i-9 https://www.uscis.gov/i-9-central/complete-and-correct-form-... Any contractor making >= $600 have to fill the payment and they receive a 1099. There are very few exceptions to that and they are listed in the article.
- varsketiz 4y ago
  Thats interesting. I have contracted with multiple entities in the US for many years and they never asked for anything like that.
  - jimmygrapes 4y ago
    I think what they meant to say is the legal entity, rather than identity; a LLC or other business formation should suffice for most reporting requirements. There may be some exceptions in some areas, but I've contracted with with thousands of entities and never once had to verify the identity of their employees unless it was for individual access (passes/badges, etc.).
    - whynotkeithberg 4y ago
      So basically any real job?
  - shrubble 4y ago
    If you are located outside of the USA then they are not required to gather this info. However if they believe you are a USA citizen or reside in the USA while doing the work, then they are supposed to.
- mgkimsal 4y ago
  (not from the article) but from a quick google search... "businesses that contract with S Corps do not need to issue them a Form 1099-MISC" I'm an s-corp, and yet I still have people 1099ing me. It's more annoying than anything because I get all my tax stuff done quickly, and someone will send out a late 1099 with slightly different numbers (typically error on their end) and... I've just given up caring about that. "You don't send 1099s to your landscaping service, or your office supply store purchases, or the energy company, but you've contracted services with them." "Oh, but you're a person"... with an s-corp registered for 10+ years and a separate employer TIN.
deleted 4y ago
[deleted]
wongarsu 4y ago
In Europe you'd get issues with accounting, both in terms of figuring out value added tax, in terms of your local tax authority asking uncomfortable questions why you have expenses without valid invoices (and yes, an invoice has to show who is invoicing). The first probably isn't an issue in the US, I'm not sure about the second. You could try to set up a company to hide your identity, but how well that works depends on the jurisdiction (in many places it's trivial to figure out the director of a company).
PeterisP 4y ago
It's not an arbitrary choice whether to treat a particular interaction as an employee or as a contractor - the nuances are a bit tricky, but in general it's prohibited to treat it as contracting if it isn't actual contracting but if someone is working what we'd call a standard full time job at a company. The obvious way (mentioned elsewhere here) is that you can reasonably provide services as a business - non-anonymously, non-pseudonymously, disclosing the exact legal identity of your shell company instead of your personal details.
- that_guy_iain 4y ago
  > It's not an arbitrary choice whether to treat a particular interaction as an employee or as a contractor - the nuances are a bit tricky, but in general it's prohibited to treat it as contracting if it isn't actual contracting but if someone is working what we'd call a standard full time job at a company. Yea, but I suspect these are all going to be remote jobs with people in other countries at which point they're all contractors. It's only people in the same country as the company since generally the thing they're trying to avoid is tax evasion and they don't care if they can't tax you.
- cma 4y ago
  Just to underline non-anonymously: https://corpgov.law.harvard.edu/2021/02/04/the-end-of-the-anonymous-shell-company-in-the-united-states https://corpgov.law.harvard.edu/2021/02/04/the-end-of-the-an... Owners can no longer hide their identity with a shell company after a recent law.

morley 4y ago

I remember reading in the last year about one of the crypto companies that hired an anonymous employee. (Maybe it was the Zcash Foundation? I can't for the life of me find the article about what they did.) Basically, they kept as low as possible the number of people who knew their real identity. That person or persons would verify employment and file the appropriate paperwork.

0xPersona 4y ago
Yes! And I think that's an important point to consider. Personally I think of "anon friendly" as existing on a spectrum. Organizations offer various degrees of it. Some "anon friendly lite" organizations will allow you to work pseudonymously, the entire organization doesn't need to know your legal identity, but certain personnel (like execs/HR) will. On the other end of the spectrum are organizations that offer "full anon friendly" where they don't request any information about your legal identity.
- judge2020 4y ago
  > On the other end of the spectrum are organizations that offer "full anon friendly" where they don't request any information about your legal identity. Have an example, besides jobs that are completely in-person and pay is done in cash/without government reporting?
  - deleted 4y ago
    [deleted]
- gnulinux 4y ago
  > On the other end of the spectrum are organizations that offer "full anon friendly" where they don't request any information about your legal identity. I don't think that'd be legal in the US. Employer has to at least verify that the person is allowed to work in the US (i.e. a citizen, permanent resident, or a legal alien with some work visa) which requires revealing employee's true identity to HR. Or do you think there is a way to perform this (and other tax regulations) without HR knowing the identity of the person?

AtlasBarfed 4y ago

Do offshoring / outsourcing companies need to report India/whereever worker IDs?

bencollier49 4y ago
No, but if the endpoint worker was from the source country (not the outsourced country), then the arrangement would fall foul of anti-tax-evasion legislation in most countries.

pjc50 4y ago

Certainly in the UK you're required to do both, and in most cases that will involve your passport or biometric residence permit. I have trouble seeing why a company would contract with a party they can't sue in the event of non-performance, unless they're a much cheaper/better option.

ghaff 4y ago
Even for small freelance jobs in the US, I've always had to provide a social security number to get paid. Sure, as an individual, I could pay you some amount of cash under the table but a company can't really legitimately do that. As others have said, that doesn't mean you can't go by a "pen name" if you like assuming the company is reasonably flexible with email addresses, employee directories, etc.

chias 4y ago

I also have some more questions, such as: * how do you provide me with health insurance and other governmental benefits? * for the purposes of anything official, am I as an individual technically unemployed? * how do you provide me with retirement options such as a 401k? * how do you report on my earnings to the IRS?

deleted 4y ago
[deleted]
Canada 4y ago
The buyer of your labor could pay your health insurance directly, or reimburse you for it. For the purposes of anything official, you are unemployed. You would not get any retirement options. Your earnings would not be reported to the IRS. Your government could say it's illegal to receive money under these circumstances, and they basically do. But think about what that means.
- cguess 4y ago
  > Your government could say it's illegal to receive money under these circumstances, and they basically do. But think about what that means. That you're committing tax fraud and will probably spend a non-trivial amount of time in prison for tax avoidance as well as having a significant portion of property seized to pay back taxes?
  - throwaway81523 4y ago
    If you report the income and pay the tax, there isn't tax fraud afaict. Eligibility verification if the work is in the US might be a different matter.
- woodruffw 4y ago
  > For the purposes of anything official, you are unemployed. You would not get any retirement options. Your earnings would not be reported to the IRS. That's called "job fraud," and it's a crime in most countries.

L0stRegulator 4y ago

Let's not forget OFAC lists, anti money laundering laws and FATCA requirements. These are driven primarily from the USA but the penalties are felt globally. Your employer likely has to get all your details to ensure you can get legally paid, otherwise they may be severely penalized.