The law, which was introduced by Senator Daniel Patrick Moynihan, Democrat of New York, was estimated to raise $60 million over five years, a figure based on a belief by a staff member of the Congressional Joint Committee on Taxation that employees cheat less on their taxes than independent contractors do. That was enough money to pay for a tax break, approved with Mr. Moynihan's support, that was sought by I.B.M. for its overseas operations. Under the Gramm-Rudman deficit control act of the previous year, Congress was required to pay for any tax cuts with comparable revenue increases or spending cuts.

A year after the law regarding contractors was enacted, the Senator tried to repeal it, but his bill died. In 1994, Senator William V. Roth, Republican of Delaware, the sponsor of this week's hearings, wrote Mr. Moynihan saying the programmers should get relief. More than 60 other senators have written similar letters since 1994, but they have not voted to change the law.

Ginny Flynn, a spokeswoman for Mr. Roth, said that while the Senator believed that the law was unfair, he was not currently moving to change it because ''despite the fact the programmers are treated differently from other people, this opens a Pandora's box of other independent contractor issues.''

Programmers and their lawyers say that as a result of inaction by Congress, many corporations have revised their policies to explicitly forbid the hiring of programmers who are independent contractors.

In response, some people, like Mrs. Johnson, incorporated. They reasoned that if they were employees of their own corporations they would be treated by the I.R.S. the way that many doctors and others are and could expand their enterprises.

But internal I.R.S. documents show that in Alaska, California, Ohio, Minnesota, New York and New Jersey, I.R.S. auditors as recently as last year hunted for corporations created by computer programmers. They found scores of such companies and then disallowed them for tax purposes. The papers show that they were disallowed because they were less than a year old and had only one employee, the programmer who created the corporation.

Across the country, officials of high-technology temporary-help companies said the I.R.S. audit tactic had caused many corporations to refuse to hire programmers unless they become employees, like Mrs. Johnson, or were employees of such temporary-help agencies.