Final answer:
The appropriate status of an individual performing work that is matched with a tax form depends on their employment classification. There are two main types of employment status: employee and independent contractor.
Step-by-step explanation:
The appropriate status of an individual performing work that is matched with a tax form depends on their employment classification. There are two main types of employment status: employee and independent contractor. An employee is someone who works for an employer and is subject to the employer's control, while an independent contractor is self-employed and works for multiple clients.
When an individual is an employee, their employer is responsible for withholding and remitting taxes on their behalf. The employee will receive a W-2 form from their employer at the end of the year, which summarizes their earnings and the amount of taxes withheld. They will need to use this information to complete their tax return using the appropriate tax form, such as the 1040 form for individuals.
On the other hand, if an individual is an independent contractor, they are responsible for paying their own taxes. They will generally receive a 1099 form from each client or business that paid them over a certain threshold. The income reported on the 1099 forms needs to be included on the individual's tax return. Self-employed individuals typically use Schedule C to report their business income and expenses on their tax return.