Self-employed people:
A) are exempt from Social Security
B) must pay in 15.3% of their earnings in Social Security taxes
C) are not eligible for Social Security
D) must pay in 7.65% of their earnings in Social Security taxes

Question

Quizplus · Accepted Answer

Self-employed individuals are required to pay both the employer and employee portions of Social Security and Medicare taxes, which add up to 15.3% of their earnings. This is known as self-employment tax. Therefore, option B is the correct choice. Options A and C are incorrect because self-employed individuals are not exempt from Social Security nor are they ineligible for it. Option D is incorrect because 7.65% is only the amount paid by employees, and self-employed individuals are responsible for both portions.

Self-Employed People