What does the IRS consider a violation of independent contractor status?

The correct choice indicates that the IRS views certain conditions as indicative of an employer-employee relationship rather than that of an independent contractor. When a salesperson is told to work set hours, guaranteed a monthly minimum wage, and has their licensing fees paid by the broker, it demonstrates control and dependence on the broker that aligns more closely with an employee status. This level of control suggests that the broker is exercising significant authority over the salesperson's work schedule and financial compensations, which are key factors in distinguishing between an independent contractor and an employee.

In contrast, allowing a salesperson to set their own hours or maintaining their own business license are characteristics that align more closely with independent contractor status, as they reflect autonomy and self-direction in their business operations. Receiving commissions only for completed sales also supports the independent contractor designation, as it indicates a performance-based compensation structure rather than a regular salary. These factors combined highlight the essential nature of business independence required by the IRS for someone to be classified as an independent contractor.