Question

Which of the following is true about independent contractors within the context of payroll?

1) They are considered employees for tax purposes
2) They are not subject to payroll taxes
3) They receive benefits such as health insurance and paid time off
4) They have more control over their work schedule and methods

Answer 1

Independent contractors within the context of payroll are not considered employees for tax purposes, are not subject to payroll taxes, and have more control over their work schedule and methods.

Step-by-step explanation:

When it comes to independent contractors within the context of payroll, several statements are true:

1. They are not considered employees for tax purposes. Independent contractors typically receive a 1099 tax statement and are responsible for reporting and paying their own taxes.
2. They are not subject to payroll taxes. Unlike employees, independent contractors do not have payroll taxes withheld from their earnings.
3. They have more control over their work schedule and methods. Independent contractors have the freedom to set their own work hours and choose how they complete their tasks.