Gig Is Up Act
Beginning in January 2027, this bill requires large app-based companies to pay the employer share of Social Security and Medicare taxes for their gig workers. Currently, because gig workers are classified as independent contractors, they must pay the entire self-employment tax themselves. This change will lower the tax burden for gig workers by transferring the employer's portion of these payroll taxes to the platform companies.
- Referred to the House Committee on Ways and Means.
- Introduced in House
- Introduced in House
The provisions, in plain language.
Adds a new provision to federal employment-tax law (Internal Revenue Code Chapter 21, which covers Social Security and Medicare payroll taxes) — the specific rule in the new section is not reproduced in the text provided, so its precise real-world effect cannot be stated from this text alone.
Expands the Social Security Act's definition of income that counts as 'net earnings from self-employment' by adding a new category (paragraph 17) — the text of that new category is not reproduced here, so which specific payments now count toward Social Security earnings cannot be stated from this text alone.
Both changes take effect for payments and compensation made after December 31, 2026.
Who it helps · who it burdens.
Who it helps
- workers whose compensation becomes newly covered under Social SecuritySec. 2(b) adds a new category of income to the Social Security Act self-employment earnings definition, which would entitle workers whose income falls in that category to accrue Social Security credits — but which workers this covers cannot be determined from the text as provided.
Who it burdens
- payers of the newly covered compensationBecause Sec. 2(a) adds a new section to the FICA employment-tax chapter and Sec. 2(b) expands the self-employment earnings definition, whoever pays the newly covered remuneration after December 31, 2026 will face new or expanded payroll-tax or SECA obligations — but the specific payer category cannot be identified because the operative text of the new provisions is not reproduced in the kit.