FPC UPDATED EXAM SCRIPT QUESTIONS AND
ANSWERS GRADED A+
✔✔Penalties for hiring unauthorized workers - 1st Offense - ✔✔$548 - $4,384 for each
worker hired
✔✔Penalties for hiring unauthorized workers - 2nd Offense - ✔✔$4,384 - $10,957 for
each worker hired
✔✔Penalties for hiring unauthorized workers - 3rd Offense - ✔✔$6,575 - $21,916 for
each worker hired
✔✔Penalties for failing to comply with verification requirements - ✔✔$220 - $2,191 for
each person for whom proper verification was not required by employer
✔✔Employer W-4 Responsibilities - ✔✔Ensure W-4 is complete.
Withhold as claimed and deduct any additional amount requested.
Keep form for at least 4 years.
Do not give advice.
✔✔Involuntary deductions - ✔✔Payroll deductions such as tax levies and court-ordered
child support that an employee must pay.
✔✔Voluntary deductions - ✔✔Payroll deductions selected by the employee such as
charitable contributions.
✔✔dispoable income - ✔✔Gross Pay - Taxes
✔✔take-home pay - ✔✔the amount of income left after taxes and other deductions are
taken out of your gross pay
✔✔CHILD LABOR UNDER AGE 18: - ✔✔Restricts the minor from working hazardous
jobs by the DOL
✔✔When Amended W-4 is implemented - ✔✔First payroll no later than 30 days after
form is submitted
✔✔Exempt Form W-4 - ✔✔No Income tax withheld for the remainder of the year. W-4S
expires on February of the year after its submitted.
✔✔Meal Periods - ✔✔ER's do not have to consider meal periods as working time
30 minutes is standard min meal period
,Meals periods not required under FLSA
✔✔FMLA (Family and Medical Leave Act) - ✔✔Eligible employees 12 weeks of unpaid
leave in a 12 month period
✔✔Child labor under age 14 - ✔✔Prohibits employment unless working for mom and
pops.
✔✔Workweek - ✔✔Any fixed, recurring period of 168 consecutive hours (7 days times
24 hours = 168 hours).
✔✔Excluded from regular rate of pay: - ✔✔GIFTS, REIMBURSED EXPENSES, PAID
TIME OFF, STOCK OPTIONS, DISCRETIONARY BONUSES, AND OVERTIME
PREMIUMS IN EXCESS OF THE PREMIUM REQUIRED BY THE FLSA ARE NOT
INCLUDED IN THE REGULAR RATE OF PAY.
✔✔Federal wage and hour law - ✔✔The Fair Labor Standards Act of 1938 (FLSA), as
amended. It regulates such areas as minimum wage, overtime pay, and child labor for
employers and employees covered by the law.
✔✔Backup Withholding - ✔✔Income tax withholding required from nonemployee
compensation when the payee fails to furnish the payer with a Taxpayer Identification
Number (TIN) or the payer is notified by the IRS that the payee's TIN is incorrect..
This is reported on Form 945.
✔✔Tip Credit - ✔✔$5.12
✔✔Non-discretionary bonus - ✔✔a bonus normally based on hours worked, units
produced, production efficiency, or work quality to nonexempt employees. (Included in
regular rate of pay.)
✔✔Engaged to be waiting - ✔✔Compensable work time because it is usually short,
spent on the employer's premises, and insufficient for the employee to use for his or her
own purposes.
✔✔Administrative employee - ✔✔Performing non-manual or office work directly related
to the management of business operations of the ER or customers.
✔✔Professional Employee - ✔✔Requires advanced knowledge. Creative professionals
work involves invention or talent.
✔✔Tipped Employees pay - ✔✔$2.13
, ✔✔Economic reality factors - ✔✔DOL uses to determine if a worker is an employee or
an independent contractor under the "to suffer or permit to work" concept.
✔✔How can form I-9 be completed - ✔✔Paper copy or electronically.
✔✔Executive employee - ✔✔Directing 2 or more Full-Time employees with the authority
recommend hiring and firing.
✔✔Form W-9 - ✔✔Request for Taxpayer Identification Number and Certification.
Used by payee to provide their (TIN) which can be a SSN or EIN.
✔✔CHILD LABOR AGE 14 AND 15: - ✔✔Work 3 hours a day and 18 hours a week
while school is in session.
8 hours a day and 40 hours a week when school is not in session.
✔✔waiting to be engaged - ✔✔is NOT work time because the employee is freed from all
duties and responsibilities for a definite period of time and has enough time to pursue
personal business before returning to work even if the employee remains on the
employer's premises, the waiting time in not work time.
✔✔Allowances decrease - ✔✔Form W-4 must be completed.
✔✔Mandatory Flat Rate - ✔✔37% when year to date supplemental ages exceed
$1,000,000.
✔✔Who is a tipped employee - ✔✔Reporting more than $30 in tips a month.
✔✔Gross-up - ✔✔Desired net pay divided by 100% minus the total of all tax rates.
EX:
5200/100%-(77$)
✔✔Optional Flat Rate - ✔✔22%
✔✔Constructive Payment - ✔✔When the employee is actually paid. Not when the
payment is available to the employee. When an amount becomes taxable.
✔✔Percentage Method first step - ✔✔subtract pre-tax deduction from gross pay
✔✔Maximum creditor garnishment - ✔✔25% of disposable earnings or disposable
earnings exceeds 30 times the minimum wage.
ANSWERS GRADED A+
✔✔Penalties for hiring unauthorized workers - 1st Offense - ✔✔$548 - $4,384 for each
worker hired
✔✔Penalties for hiring unauthorized workers - 2nd Offense - ✔✔$4,384 - $10,957 for
each worker hired
✔✔Penalties for hiring unauthorized workers - 3rd Offense - ✔✔$6,575 - $21,916 for
each worker hired
✔✔Penalties for failing to comply with verification requirements - ✔✔$220 - $2,191 for
each person for whom proper verification was not required by employer
✔✔Employer W-4 Responsibilities - ✔✔Ensure W-4 is complete.
Withhold as claimed and deduct any additional amount requested.
Keep form for at least 4 years.
Do not give advice.
✔✔Involuntary deductions - ✔✔Payroll deductions such as tax levies and court-ordered
child support that an employee must pay.
✔✔Voluntary deductions - ✔✔Payroll deductions selected by the employee such as
charitable contributions.
✔✔dispoable income - ✔✔Gross Pay - Taxes
✔✔take-home pay - ✔✔the amount of income left after taxes and other deductions are
taken out of your gross pay
✔✔CHILD LABOR UNDER AGE 18: - ✔✔Restricts the minor from working hazardous
jobs by the DOL
✔✔When Amended W-4 is implemented - ✔✔First payroll no later than 30 days after
form is submitted
✔✔Exempt Form W-4 - ✔✔No Income tax withheld for the remainder of the year. W-4S
expires on February of the year after its submitted.
✔✔Meal Periods - ✔✔ER's do not have to consider meal periods as working time
30 minutes is standard min meal period
,Meals periods not required under FLSA
✔✔FMLA (Family and Medical Leave Act) - ✔✔Eligible employees 12 weeks of unpaid
leave in a 12 month period
✔✔Child labor under age 14 - ✔✔Prohibits employment unless working for mom and
pops.
✔✔Workweek - ✔✔Any fixed, recurring period of 168 consecutive hours (7 days times
24 hours = 168 hours).
✔✔Excluded from regular rate of pay: - ✔✔GIFTS, REIMBURSED EXPENSES, PAID
TIME OFF, STOCK OPTIONS, DISCRETIONARY BONUSES, AND OVERTIME
PREMIUMS IN EXCESS OF THE PREMIUM REQUIRED BY THE FLSA ARE NOT
INCLUDED IN THE REGULAR RATE OF PAY.
✔✔Federal wage and hour law - ✔✔The Fair Labor Standards Act of 1938 (FLSA), as
amended. It regulates such areas as minimum wage, overtime pay, and child labor for
employers and employees covered by the law.
✔✔Backup Withholding - ✔✔Income tax withholding required from nonemployee
compensation when the payee fails to furnish the payer with a Taxpayer Identification
Number (TIN) or the payer is notified by the IRS that the payee's TIN is incorrect..
This is reported on Form 945.
✔✔Tip Credit - ✔✔$5.12
✔✔Non-discretionary bonus - ✔✔a bonus normally based on hours worked, units
produced, production efficiency, or work quality to nonexempt employees. (Included in
regular rate of pay.)
✔✔Engaged to be waiting - ✔✔Compensable work time because it is usually short,
spent on the employer's premises, and insufficient for the employee to use for his or her
own purposes.
✔✔Administrative employee - ✔✔Performing non-manual or office work directly related
to the management of business operations of the ER or customers.
✔✔Professional Employee - ✔✔Requires advanced knowledge. Creative professionals
work involves invention or talent.
✔✔Tipped Employees pay - ✔✔$2.13
, ✔✔Economic reality factors - ✔✔DOL uses to determine if a worker is an employee or
an independent contractor under the "to suffer or permit to work" concept.
✔✔How can form I-9 be completed - ✔✔Paper copy or electronically.
✔✔Executive employee - ✔✔Directing 2 or more Full-Time employees with the authority
recommend hiring and firing.
✔✔Form W-9 - ✔✔Request for Taxpayer Identification Number and Certification.
Used by payee to provide their (TIN) which can be a SSN or EIN.
✔✔CHILD LABOR AGE 14 AND 15: - ✔✔Work 3 hours a day and 18 hours a week
while school is in session.
8 hours a day and 40 hours a week when school is not in session.
✔✔waiting to be engaged - ✔✔is NOT work time because the employee is freed from all
duties and responsibilities for a definite period of time and has enough time to pursue
personal business before returning to work even if the employee remains on the
employer's premises, the waiting time in not work time.
✔✔Allowances decrease - ✔✔Form W-4 must be completed.
✔✔Mandatory Flat Rate - ✔✔37% when year to date supplemental ages exceed
$1,000,000.
✔✔Who is a tipped employee - ✔✔Reporting more than $30 in tips a month.
✔✔Gross-up - ✔✔Desired net pay divided by 100% minus the total of all tax rates.
EX:
5200/100%-(77$)
✔✔Optional Flat Rate - ✔✔22%
✔✔Constructive Payment - ✔✔When the employee is actually paid. Not when the
payment is available to the employee. When an amount becomes taxable.
✔✔Percentage Method first step - ✔✔subtract pre-tax deduction from gross pay
✔✔Maximum creditor garnishment - ✔✔25% of disposable earnings or disposable
earnings exceeds 30 times the minimum wage.
