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Payroll Fundamentals Questions
1. A sole proprietor with two employees is exempt from the requirements of
the federal income tax withholding law. a. True b. False - -Correct Answer-
False
2. Not-for-profit corporations that are exempt from federal income taxes do
not withhold income taxes from their employee's pay. a. True b. False - -
Correct Answer-False
3. Cash tips of $20 dollars or more in a month must be reported to the
employer by the tipped employee by the end of the following month. a. True
b. False - -Correct Answer-False
4. Employees who regularly receive cash tips of $20 dollars or more in a
calendar month are subject to federal income tax withholding on the tips. a.
True b. False - -Correct Answer-True
5. Employees who are receiving over $1 million dollars in supplemental
wages for the year will have a 39.6% withholding rate apply to the
supplemental payments in excess of $1 million dollars. a. True b. False - -
Correct Answer-True
1
Payroll Fundamentals Questions
1. A sole proprietor with two employees is exempt from the requirements of
the federal income tax withholding law. a. True b. False - -Correct Answer-
False
2. Not-for-profit corporations that are exempt from federal income taxes do
not withhold income taxes from their employee's pay. a. True b. False - -
Correct Answer-False
3. Cash tips of $20 dollars or more in a month must be reported to the
employer by the tipped employee by the end of the following month. a. True
b. False - -Correct Answer-False
4. Employees who regularly receive cash tips of $20 dollars or more in a
calendar month are subject to federal income tax withholding on the tips. a.
True b. False - -Correct Answer-True
5. Employees who are receiving over $1 million dollars in supplemental
wages for the year will have a 39.6% withholding rate apply to the
supplemental payments in excess of $1 million dollars. a. True b. False - -
Correct Answer-True
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