An independent contractor is a person or company that works for clients and bills them for the work. They control how the work is done, get paid for the work completed, and do not have taxes withheld from their payments. They are responsible for calculating and paying taxes themselves.
Employees are full-time or part-time workers whose work is controlled by the employer. The employer can dictate when, where, and how the work is done. Employees have taxes withheld from their paychecks, but half of the cost of Social Security and Medicare taxes are paid by the employer. They may receive other benefits as well.