Mid-America Carpenters Union Shines Light on Construction Industry Tax Fraud

CHICAGO, April 18, 2025 /PRNewswire/ -- This week members of the Mid-America Carpenters Regional Council demonstrated in front of more than 50 public buildings throughout Illinois, Missouri, Kansas and Eastern Iowa to educate policymakers and the public about the devastating impact construction industry tax fraud has on workers, state economies and the public at large. Members also sent 400 emails to prosecuting attorneys in those regions to raise awareness.

Construction employer tax fraud hurts everyone. Workers are paid off the books or intentionally misclassified as independent contractors by shady subcontractors and labor brokers who are hired by contractors to underbid law-abiding businesses. Fraud happens on all types of projects, including taxpayer-funded construction. Rampant cheating causes a massive loss of revenue and makes it difficult to repair roads, bridges and schools, care for veterans and shore up Medicare and Social Security.

A recent study of construction industry tax fraud by the Century Foundation shows that 2.1 million construction workers are paid off the books or misclassified as independent contractors, costing U.S. taxpayers more than $10 billion a year.

"Construction industry tax fraud affects every man, woman and child," said Kevin McLaughlin, Executive Secretary-Treasurer of the Mid-America Carpenters Regional Council, which represents more than 53,000 members. "Every time an unscrupulous contractor cheats the system and doesn't pay what they owe, that means less money in the public coffers for education, public safety, healthcare and other essential services. We're calling on our elected officials at the local, state and federal levels to hold cheating contractors accountable and help ease the burden on taxpayers."

The consequences are dire for working families affected by employer tax fraud. The University of California Berkeley Labor Center found that 39 percent of construction worker families nationwide are forced to enroll in one or more safety net programs to make ends meet.

Tax fraud and workers' compensation premium fraud have become so alarming in the construction industry that the U.S. Department of the Treasury's Financial Crimes Enforcement Network notified banks, check cashing stores and other financial institutions to report the suspicious transactions of construction contractors.

Visit StopTaxFraud.net/StandUp for more information.

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SOURCE Mid-America Carpenters Regional Council