The classification of a worker as an employee or an independent contractor determines how much payroll tax a company must pay. True False QUESTION 2 Employers must withhold state and federal income tax from compensation paid to independent contractors. True False QUESTION 3 An independent contractor is not entitled to the same fringe benefits as an employee. True False UESTION 4 An employee recognizes taxable income if his employer provides group-term life insurance coverage in excess of $50,000. True False