Statutory Employees

Statutory employees are workers who fall under a specific category defined by tax laws. They are not traditional employees but still have some benefits similar to them. For example, they typically work for one company, perform services under the company's control, and are paid on a commission or similar basis. Statutory employees pay Social Security and Medicare taxes but receive certain tax advantages, like the ability to deduct business expenses on their tax returns. Understanding their status is important for tax purposes and impacts how taxes are withheld and reported.