Which of the following statements regarding independent contractors and employees is true?
A)Independent contractors pay Social Security and Medicare tax of 15.3%.
B)Employees must pay unemployment taxes.
C)Independent contractors and employees pay the same Social Security and Medicare tax rates.
D)Independent contractors deduct their business expenses "from AGI."

Question

Quizplus · Accepted Answer

Independent contractors are responsible for paying both the employer and employee portions of Social Security and Medicare taxes, totaling 15.3%. Employees only pay for the employee portion, while their employer covers the employer portion. B is partially true, as employees do pay unemployment taxes, but independent contractors generally do not. C is false, as mentioned in explanation A. D is partially true but not exclusive to independent contractors, as all taxpayers are permitted to deduct eligible business expenses "from AGI."

Which of the Following Statements Regarding Independent Contractors and Employees