CERTIFIED PAYROLL PROFESSIONAL
(CPP) 2026 ACTUAL QUESTIONS
WITH VERIFIED ANSWERS.
Be in writing, must be for the benefit of employees, meet
eligibility and vesting requirements, and not discriminate in
favor of highly compensated employees - correct answer-
Qualified retirement plans must:
$3,300.00 - correct answer-Medical FSA contribution limit
Box 12 with Code D - correct answer-Where are employee
401k contributions reported on a W-2?
Taken into account - correct answer-the point in time when
contributions into a nonqualified deferred compensation plan
become taxable for social security and Medicare taxes
A cafeteria plan - correct answer-meets IRC §125 requirements
to employers to select a menu of generally nontaxable benefits
,Nontaxable §125 plan benefits are not reported on Forms W-2
or 941. Contributions are included on an employer's annual
Form 940. - correct answer-How are §125 plan benefits
reported?
Deferred compensation - correct answer-a postponement of
taxable wage payments to a future date
The deferral of compensation from one plan year to another
plan year - correct answer-What does a §125 plan not allow?
FIT: when they fail to meet §409A or when a distribution is
made
SS & Med: when services are performed or vesting
requirements have been met - correct answer-When are
nonqualified plans subject to taxation?
Box 12 with Code AA; yes, subject to FIT, SS, & Medicare taxes
- correct answer-Where are Roth 401k contributions reported
on a W-2 and are they subject to tax?
,Public sector employers (state and local governments and tax-
exempt organizations other than churches) - correct answer-
457(b) plans are for:
By determining the average deferral percentage of the highly
compensated employee group and the non-highly
compensated employee group. Then running calculations to
determine if the HCE group's ADP exceeds the NHCE ADP by
more than a certain percent. - correct answer-How is the ADP
test calculated?
Public schools and tax exempt charitable, religious, and
educational organizations - correct answer-403(b) plans are for:
Under semiweekly or monthly deposit rules - correct answer-
When is backup withholding deposited?
$2,500 - correct answer-Employers can deposit quarterly if their
tax liability is less than ____ for the current or previous quarter
, The 1st Wednesday or Friday on or after the 15th of the next
month or when Form 941 is due (whichever is earlier) - correct
answer-What is the shortfall makeup deposit for a semiweekly
depositor?
Taxable wages - correct answer-Form 941, line 2
Form 941, Schedule R - correct answer-allocates the aggregate
information reported on form 941 by an agent to each client
Form 941 - correct answer-Taxes withheld from fringe benefits
are reported on what?
Social security & Medicare taxes withheld - correct answer-
Insurance companies record ____ from 3rd party sick pay on
their Form 941.
Dependent care benefits - correct answer-W-2, Box 10
(CPP) 2026 ACTUAL QUESTIONS
WITH VERIFIED ANSWERS.
Be in writing, must be for the benefit of employees, meet
eligibility and vesting requirements, and not discriminate in
favor of highly compensated employees - correct answer-
Qualified retirement plans must:
$3,300.00 - correct answer-Medical FSA contribution limit
Box 12 with Code D - correct answer-Where are employee
401k contributions reported on a W-2?
Taken into account - correct answer-the point in time when
contributions into a nonqualified deferred compensation plan
become taxable for social security and Medicare taxes
A cafeteria plan - correct answer-meets IRC §125 requirements
to employers to select a menu of generally nontaxable benefits
,Nontaxable §125 plan benefits are not reported on Forms W-2
or 941. Contributions are included on an employer's annual
Form 940. - correct answer-How are §125 plan benefits
reported?
Deferred compensation - correct answer-a postponement of
taxable wage payments to a future date
The deferral of compensation from one plan year to another
plan year - correct answer-What does a §125 plan not allow?
FIT: when they fail to meet §409A or when a distribution is
made
SS & Med: when services are performed or vesting
requirements have been met - correct answer-When are
nonqualified plans subject to taxation?
Box 12 with Code AA; yes, subject to FIT, SS, & Medicare taxes
- correct answer-Where are Roth 401k contributions reported
on a W-2 and are they subject to tax?
,Public sector employers (state and local governments and tax-
exempt organizations other than churches) - correct answer-
457(b) plans are for:
By determining the average deferral percentage of the highly
compensated employee group and the non-highly
compensated employee group. Then running calculations to
determine if the HCE group's ADP exceeds the NHCE ADP by
more than a certain percent. - correct answer-How is the ADP
test calculated?
Public schools and tax exempt charitable, religious, and
educational organizations - correct answer-403(b) plans are for:
Under semiweekly or monthly deposit rules - correct answer-
When is backup withholding deposited?
$2,500 - correct answer-Employers can deposit quarterly if their
tax liability is less than ____ for the current or previous quarter
, The 1st Wednesday or Friday on or after the 15th of the next
month or when Form 941 is due (whichever is earlier) - correct
answer-What is the shortfall makeup deposit for a semiweekly
depositor?
Taxable wages - correct answer-Form 941, line 2
Form 941, Schedule R - correct answer-allocates the aggregate
information reported on form 941 by an agent to each client
Form 941 - correct answer-Taxes withheld from fringe benefits
are reported on what?
Social security & Medicare taxes withheld - correct answer-
Insurance companies record ____ from 3rd party sick pay on
their Form 941.
Dependent care benefits - correct answer-W-2, Box 10
