Prairie Fire, Inc. needs an additional worker on a multiyear project. It could hire an employee for a $$50,000$ annual salary. Alternatively, it could engage an independent contractor for a $$55,000$ annual fee. Which of the following is TRUE?

None of these choices are true.

Praitie Fire, Inc. must with hold payroll tax from the salary or the fee.

Prairie Fire, Inc. must withhold lederal and state income tax from the salary or the fee.

Prairie Fire, Inc. must issue a Form W$-2$ to the employee or the independent contractor.