A worker may prefer to be classified as an employee (rather than an independent contractor) for which of the following reasons:
A)To claim unreimbursed work-related expenses as a deduction for AGI.
B)To avoid the self-employment tax.
C)To avoid the overall limitation (50%) on unreimbursed business entertainment expenses.
D)To avoid the limitations on unreimbursed work-related expenses.
E)None of these.

Question

Quizplus · Accepted Answer

A worker may prefer to be classified as an employee rather than an independent contractor to avoid the self-employment tax, which can be a significant financial burden for independent contractors. Other options, such as claiming unreimbursed expenses as deductions for AGI or avoiding limitations on business entertainment expenses, are not dependent on employee classification.

A Worker May Prefer to Be Classified as an Employee