Which of the Following Statements Regarding Employee Versus Independent Contractor

question 96

Multiple Choice

Which of the following statements regarding employee versus independent contractor status is false?

• A) The determination as to whether a worker is an employee or an independent contractor is based on a subjective set of guidelines.
• B) An employer has a financial incentive to classify a worker as an independent contractor instead of an employee.
• C) The IRS has a higher probability of collecting income and payroll taxes from an independent contractor than from an employee.
• D) If the IRS reclassifies a worker from independent contractor to employee, the employer can become liable for the employee's share of unpaid payroll taxes.

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Definitions:

Actively Participated

The engagement of individuals in activities or events in a manner that is both enthusiastic and contributing towards the achievement of a goal.

Free Rider

An individual who benefits from resources or services without directly contributing to the cost or effort involved in their provision.

Marriage

Is a socially approved, presumably long-term sexual and economic union between two people. It involves reciprocal rights and obligations between spouses and between parents and children.

Intense Involvement

A high degree of engagement or commitment to an activity, cause, or interest, often exceeding the normative level of participation.