A company reclassifies a worker it had been paying as an independent contractor and begins treating her as an employee. Which set of obligations does the employer now have for her pay? A Withhold federal income tax only, pay no employer taxes, and report the pay on Form 1099-NEC. B Withhold nothing, pay employer FICA and FUTA on her pay, and issue both Form W-2 and Form 1099-NEC. C Withhold federal income tax and employee FICA, pay employer FICA and FUTA, and issue Form W-2. D Withhold the employee FICA share only, pay FUTA, and report the pay on Form 1099-NEC.
Practice questions based on the PayrollOrg Fundamental Payroll Certification content outline and on federal payroll authorities including IRS Publication 15 (Circular E), Publication 15-A, Publication 15-B, the Fair Labor Standards Act, and the Consumer Credit Protection Act. FPC and CPP are marks of PayrollOrg; this site is not affiliated with or endorsed by PayrollOrg. Amounts that are adjusted each year — wage bases, contribution limits, the minimum wage, mileage and per-diem rates — are given inside the question rather than tested from memory, and state-specific rules are out of scope. Confirm the current content outline and the current-year figures from the official sources before testing.
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