EmploymentQuestion 1092 of 1605

At year-end, an employer reports an employee's wages on which form, as opposed to the form used for an independent contractor?

a.Form DE 34 for both
b.No forms are required
c.Form W-2 for employees; Form 1099-NEC for independent contractors
d.Form I-9 for both

Explanation

Employers report an employee's annual wages and withholdings on Form W-2, while payments to an independent contractor are reported on Form 1099-NEC. Misclassifying an employee as a 1099 contractor to avoid payroll taxes and workers' comp can expose the employer to significant liability.

Law Reference: IRS Form W-2 vs. 1099

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