CPP Practice Exam 208 Questions with Verified Answers,100% CORRECT

CPP Practice Exam 208 Questions with Verified Answers From what taxes are cafeteria plan contributions generally exempt? A. SS, Medi, FIT, and FUTA B. FIT and SIT C. SS, Medi, FUTA, and SUI D. SS, Medi, FIT, and SIT - CORRECT ANSWER A. Social Security, Medicare, FIT, and FUTA Reference 4.5 Cafeteria Plans In which boxes on the W-2 would you report the adoption assistance? A. Boxes 3, 4, 5, 6 B. Boxes 1, 2, 3, 4, 5, 6, 12 - Code T C. Boxes 3, 4, 5, 6, 12 - Code A D. Boxes 3, 4, 5, 6, 12- Code T - CORRECT ANSWER D. Boxes 3, 4, 5, 6, 12- Code T Reference 3.3 - 7 Adoption Assistance Which account is generally listed first on a corporate balance sheet? A. Investments in subsidiary companies B. Land and improvements C. Prepaid expenses D. Buildings and other property - CORRECT ANSWER C. Prepaid expenses What is a key advantage of processing payroll with a service provider compared to an in-house payroll system? A. No initial investment, no maintenance B. Enhanced communications capability C. Cost-effective resource and data sharing D. Convenience - CORRECT ANSWER A. No initial investment, no maintenance Reference 12.3 - 1 Service Providers - Outsourcing the Payroll What kind of account is Accrued Salaries Payable? A. Asset B. Expense C. Liability D. Revenue - CORRECT ANSWER C. Liability Reference 11.1 - 1 Account Classifications An ER has received multiple attachments for an EE. The orders were received in the following sequence: Federal tax levy, consumer garnishment, and child support payment order. In which order are the attachments applied against the EE's wages? A. Federal levy, child support payment, consumer garnishment B. Child support payment, consumer garnishment, federal levy C. Child support payment, federal levy, consumer garnishment D. Federal levy, consumer garnishment, child support payment - CORRECT ANSWER A. Federal levy, child support payment, consumer garnishment Reference 9.1 - 4 Bankruptcy Order Under the principle of double-entry bookkeeping, what can a credit to an account signify? A. An increase in an asset account B. A decrease in a capital account C. A decrease in a liability account D. An increase in a liability account - CORRECT ANSWER D. An increase in a liability account Reference 11.6 Balancing and Reconciling Payroll Accounts Bob passed away December 8, 2013. His annual salary was $80,000.00 and he had 80 hours of accrued vacation. His YTD earnings prior to his death were $74,000.00. His surviving spouse received the vacation payout on December 28, 2013. How did the payment to spouse impact Bob's 2013 W-2? A. Box 1 - $77,076.80; Box 3 - $77,076.80; Box 5 - $77,076.80 B. Box 1 - $74,000.00; Box 3 - $77,076.80; Box 5 - $77,076.80 C. Box 1 - $74,000.00; Box 3 - $74,000.00; Box 5 - $77,076.80 D. Box 1 - $74,000.00; Box 3 - $74,000.00; Box 5 - $74,000.00 - CORRECT ANSWER B. Box 1 - $74,000.00; Box 3 - $77,076.80; Box 5 - $77,076.80 Reference 3.4 - 30 Wages Paid After Death When using vendor-supplied software to process payroll, what is considered a disadvantage? A. User group networking B. Ease of use C. Specific needs may not be met D. Initial installation costs - CORRECT ANSWER C. Specific needs may not be met Reference 12.3 - 2 In-House Payroll Systems Which W-2 Box 12 code is used for a 403(b) plan? A. F B. E C. D D. K - CORRECT ANSWER B. E (E for Education) Reference 4.6 - 3 Tax Sheltered Annuities What phase of in-house system design follows the Development Phase? A. Evaluation Phase B. Conceptual Definition Phase C. Analysis Phase D. User Testing Phase - CORRECT ANSWER D. User Testing Phase Reference 12.3 - 2 In - House Payroll Systems Which management theory reviews the differences between managers and leaders? A. Kotter B. Covey C. Hershey, Blanchard, Johnson D. Principle-Centered Leadership - CORRECT ANSWER A. Kotter Wages are paid on Wednesday, Mar 26, resulting in a deposit liability of $90,000. Wages are paid again on Thursday, Mar 27, resulting in a deposit liability of $12,000. Assume that Tuesday, Apr 15, is a nonbanking day. Under the semiweekly deposit rule, when are the deposits due? A. $102,000 is due on Friday, March 28 B. $102,000 is due on Wednesday March 26 C. $102,000 is due on Thursday March 27 D. $102,000 is due on Tuesday, April 1 - CORRECT ANSWER A. $102,000 is due on Friday, March 28 Which of following is one of the five steps of empowerment? A. Training B. Motivating C. Hiring the right employees D. Provide guidelines - CORRECT ANSWER D. Provide guidelines Reference 13.1 Basic Management Theory Which form notifies an ER that an EE's wages have been released from a levy? A. 843 B. 668 - W C. 668 - D D. 673 - CORRECT ANSWER C. 668 - D Reference 9.1 - 1 Tax Levies What journal entries are required to record $250,000.00 in salaries earned during the last week of July but paid in Aug? A. Debit salary expense; credit salary payable B. Debit salary payable; credit payroll checking C. Debit liabilities; credit salary expense D. Debit assets; credit salary expense - CORRECT ANSWER A. Debit salary expense; credit salary payable Reference 11.2 Journal Entries What is NOT a staffing concern? A. Recruiting and selecting B. Writing job descriptions C. Evaluating next year's staff budget D. Delegating tasks - CORRECT ANSWER C. Evaluating next year's staff budget Reference 13.2 - 2 Staffing When an ER compensates an EE with restricted stock, when is the compensation taxable? A. When the EE sells the stock B. At the end of the next quarter C. When the risk of forfeiture ends D. At the end of the year - CORRECT ANSWER C. When the risk of forfeiture ends Reference 3.4 - 24 Stocks and Stock Options An EE is having difficulty instituting state-mandated changes in handling child support payments. Although working overtime, they struggle with the legal requirements, and the program is not operational. What style of manager is most likely to be effective in handling the EE's performance gap? A. High task, low relationship B. Low task, low relationship C. High task, high relationship D. Low task, high relationship - CORRECT ANSWER C. High task, high relationship Reference 13.1 Basic Management Theory A student is exempt from SS and Medi tax when holding what visa? A. J only B. Q only C. F, J or Q D. F only - CORRECT ANSWER C. F, J or Q Reference 14.2 - 3 Federal Income Tax Withholding for Nonresident Aliens A manager who prefers facts over speculation and insists on real-world proof indicates the communication style defined as: A. Introspective B. Assertive C. Expressive D. Supportive - CORRECT ANSWER B. Assertive Reference 13.1 Basic Management Theory What journal entry is posted as a debit (DR)? A. $5,000.00 paycheck, posted to the checking account B. $10,000.00 withheld taxes, posted to liability account C. $15,000.00 deposit of withheld taxes, posted to liability account D. $55,000.00 payroll tax liability, posted to liability account - CORRECT ANSWER C. $15,000.00 deposit of withheld taxes, posted to liability account Reference 11.2 Journal Entries A semiweekly depositor's payday is on Friday the 10th. The following Wednesday, the company deposits 98% of its accumulated payroll tax liability. When is the shortfall due? A. With its quarterly return B. On or before its next deposit due date C. The first Wednesday or Friday, on or after the 15th of the following month D. On the next Wednesday or Friday after the first of the next month. - CORRECT ANSWER C. The first Wednesday or Friday, on or after the 15th of the following month Reference 8.2 - 1 Payroll Tax Deposit Rules What documents have a two-year retention period? A. The EE's occupation B. Work time schedules C. Hospital workers' agreements to 8/80 plan D. Form I-9 - CORRECT ANSWER B. Work time schedules Reference 10.1 Fair Labor Act A company has current assets of $150,000.00, other assets of $140,000.00, revenue of $590,000.00, expenses of $430,000.00, current liabilities of $105,000.00, and long-term liabilities of $135,000.00. What is the company owner's equity? A. $45,000.00 B. $50,000.00 C. $210,000.00 D. $55,000.00 - CORRECT ANSWER B. $50,000.00 Reference 11.1 - 1 Account Classifications Where do taxable Medicare wages get reported? A. On line 5c of Form 941 B. On line 2 of Form 941 C. In box 3 of Form W-2 D. In Part 1 of Form 940 - CORRECT ANSWER A. On line 5c of Form 941 Reference 8.3 - 3 Form 941 Line - by - Line Instructions Under the FLSA, all of the following records are required to be retained for at least three years from the last date they were in effect EXCEPT: A. Timecards B. Collective bargaining agreements C. Certificates authorizing the employment of minors D. Records showing total sales volume and goods purchased - CORRECT ANSWER A. Timecards Reference 10.1 Fair Labor Standards Act Bob has enrolled in a dependent GTL insurance plan. The coverage per dependent is $3,000.00. He covers 3 family members. Determine the value of imputed income. A. $9,000.00 B. $3,000.00 C. $6,000.00 D. $5,000.00 - CORRECT ANSWER A. $9,000.00 Reference 3.3 -1 Life Insurance The journal entries required to record federal income tax withheld are: A. Debit tax expense, credit federal income tax withheld B. Debit salary payable, credit federal income tax withheld C. Debit tax payable, credit cash D. Debit cash, credit tax expense - CORRECT ANSWER B. Debit salary payable, credit federal income tax withheld Reference 11.2 Journal Entries In which W-2 box must allocated tips be reported? A. Box 1,3, 5 B. Box 3, 5 C. Box 3, 5, 8 D. Box 8 - CORRECT ANSWER D. Box 8 Reference 3.4 - 27 Tips On form W-2, what box is used to report wages, tips, and other compensation? A. Box 1 B. Box 10 C. Box 12 D. Box 14 - CORRECT ANSWER A. Box 1 Reference 8.8 - 3 Box-By-Box Instructions for Form W-2 EEs of a company are covered by a long term disability plan through a private insurance carrier. Bob's insurance costs $27 per month. The company pays 100% of the insurance cost. In Bob's seventh month of temporary disability, he receives $250.00 in benefits. How much of the benefit is taxable? A. FIT $0.00 SS/Medi $27.00 B. FIT $0.00 SS/Medi $250.00 C. FIT $250.00 SS/Medi $0.00 D. FIT $250.00 SS/Medi $250.00 - CORRECT ANSWER C. FIT $250.00 SS/Medi $0.00 Reference 4.3 - 2 Sick Pay Under a Separate Plan When must payments made by a business to non-corporate independent contractors for services rendered be reported to the IRS? A. Payments exceed $1,000 for the calendar year B. Payments exceed $600 in the last 12 months C. Payments exceed $600 for the calendar year D. Payments exceed $1,500 for the calendar year - CORRECT ANSWER C. Payments exceed $600 for the calendar year Reference 8.12 - 1 Miscellaneous Payments Made by Businesses All of the following duties would be included in the job description of an EE working in the payroll department EXCEPT: A. Data entry of payroll input B. Review source documents for proper authorization C. Reconciliation of payroll bank account D. Distribution of payroll related reports - CORRECT ANSWER C. Reconciliation of payroll bank account Reference 13.2 - 2 Staffing In a computer system, what is the organization of related data called? A. Job B. Record C. Field D. File - CORRECT ANSWER D. File Reference 10.2 Internal Revenue Code After a new system has been selected and approved, what is the next step in the selection process? A. Specify scope B. Implementation C. Review D. Define requirements - CORRECT ANSWER B. Implementation Reference 12 - 13 Implementation System A manager building a successful team must deal with EEs who have different personal styles. Each of the following styles is represented on a team other than: A. Contributors B. Controllers C. Collaborators D. Communicators - CORRECT ANSWER B. Controllers Reference 13.1 Basic Management Theory When a company purchases a computer on credit for $2,500, which of the following journal entries is made? A. Debit assets and debit liabilities B. Debit assets and credit liabilities C. Credit assets and debit liabilities D. Credit assets and credit owner's equity - CORRECT ANSWER B. Debit assets and credit liabilities Reference 11.2 Journal Entries What entries are required to record $45,000 in salaries earned between March 27 and March 30 but not paid until April 6? A. Debit salary payable, credit payroll checking B. Credit salary expense, debit salary payable C. Credit salary expense, debit assets D. Debit salary expense, credit salary payable - CORRECT ANSWER D. Debit salary expense, credit salary payable Reference 11.3 Recording Payroll Transactions What is a warning or alert called that is built into the system that checks for errors and either corrects the error or notifies the operator that something may be wrong? A. Monitor edit B. System edit C. Control edit D. Procedure edit - CORRECT ANSWER B. System edit Reference 12.5 - 1 Putting Controls into the Process What effect do revenues have on accounts? A. Increasing expenses B. Decreasing liabilities C. Decreasing owner's equity D. Increasing owner's equity - CORRECT ANSWER D. Increasing owner's equity Reference 11.1 - 1 Account Classifications Once an EE has given authorization for EFT and the ER creates electronic pay transactions for deposit, where does the ER send them? A. ACH B. RDFI C. ODFI D. NACHA - CORRECT ANSWER C. ODFI Reference Section 5.3-2 Direct Deposit How long must an EE's W-4 be retained by an ER? A. 3 years B. 10 years C. 4 years D. 5 years - CORRECT ANSWER C. 4 years Reference Section 6.3 - 1 Form W-4 The maximum hourly Tip Credit is: A. $6.55 B. $2.13 C. $3.72 D. $5.12 - CORRECT ANSWER D. $5.12 ($7.25 - $2.13 = $5.12) (2014 & 2015 Rate) Reference Section 2.5 - 1Tips and the Tip Credit If an ER is unable to collect SS/MED due on an EE's reported Tip Income, the ER must: A. Pay the EE's share of SS/Medi B. Report the uncollected amount on the EE's W-2 in Box 12, coded "A" for SS, "B" for Medi C. Report the uncollected amount in Boxes 4 and 6 on the EE's W-2 D. Not report the uncollected amount until it is collected from the EE - CORRECT ANSWER B. Report the uncollected amount on the EE's W-2 in Box 12, coded "A" for SS, "B" for Medicare Reference Section 3.4 - 27 Tips Which of the following groups best defines the term nonexempt under FLSA? A. A lower-paid class of EEs B. Hourly-paid workers only C. EEs who must be paid overtime D. A special class of EEs as determined by the ER - CORRECT ANSWER C. Employees who must be paid overtime Reference Section 2.4 Exempt and Nonexempt Employees ER's Annual Information Return of Tip Income and Allocated Tips is Form: A. 8027 B. 5500 C. 8109 D. SS8 - CORRECT ANSWER A. 8027 Reference Section 3.4 - 27 Tips The amount of federal income tax that must be withheld from non-wage payments to an individual who has failed to provide a taxpayer identification number (TIN) is: A. 28% B. 31% C. 20% D. 25% - CORRECT ANSWER A. 28% (2014 & 2015 Rate) Reference Section 6.5 Backup Withholding Which of the following must be obtained from new EEs? A. Social Security Card B. W-4 C. I-9 D. W-2 - CORRECT ANSWER A. Social Security Card Reference Section 6.2 - 1 Obtaining an Employee's SSN Moving expenses are reported on the W-2: A. Taxable portion in Box 1; Non-taxable portion in Box 12 B. Taxable portion in Boxes 1, 3, 5; Non-taxable portion in Box 12 C. Taxable portion in Box 1; Non-taxable portion in Box 12, coded "P" D. Taxable portion in Boxes 1, 3, 5; Non-taxable portion in Box 12, coded "P" - CORRECT ANSWER D. Taxable portion in Boxes 1, 3, 5; Non-taxable portion in Box 12, coded "P" Reference Section 3.2 - 2 Moving Expenses Wages paid after death in the calendar year after the EE's death are taxable for: A. SS/Medi, FUTA, FITW B. SS/Medi, FUTA C. Not taxable for SS/Medi, FUTA, FITW D. SS/Medi only - CORRECT ANSWER C. Not taxable for Social Security/Medicare, FUTA, FITW Reference Section 3.4 - 30 Wages Paid After Death The Annual Return/Report of EE Benefit Plan is Form: A. 8109 B. SS8 C. 5500 D. 8027 - CORRECT ANSWER C. 5500 Reference Section 4.5 - 9 Reporting Requirements Bob lives in Vermont and works in New York. Vermont has a state minimum wage of $8.06 per hour and New York has a state minimum wage of $7.25 per hour. What is the least hourly rate that Bob's ER may pay him? A. $8.06 B. $6.55 C. $7.25 (based on state where he's working, not living) D. Either A, B, or C - ER may choose - CORRECT ANSWER C. $7.25 (based on state where he's working, not living) Reference Section 2.11 - 1 State Minimum Wage Rates Bob goes out on disability on May 1. His disability lasts until June 9. On May 29 Bob advises his ER that he will be taking a six month (unpaid) leave of absence. He is expected to return to work on Dec 4. He decides not to return to work and notifies his ER on Sept 5. On what date do COBRA rates become effective? A. May 29 B. June 9 C. September 5 D. December 4 - CORRECT ANSWER C. September 5 Reference Section 4.1 - 5 COBRA Health Insurance Continuation Federal law prohibits the employment of minors: A. Under the age of 14 under any circumstances B. Under the age of 14 except by a parent or in certain jobs C. Under the age of 15 under any circumstances D. Under the age of 16 except by parent or in certain jobs - CORRECT ANSWER B. Under the age of 14 except by a parent or in certain jobs Reference Section 2.8 Child Labor Restrictions Which of the following BEST describes a tax-free athletic facility benefit? A. Staffed by EEs and available to most of the EEs B. Located on ER owned property and used by EEs and their dependents C. Used for residential purposes and located on EE leased property D. Operated by local fitness company and primarily used by highly paid EEs - CORRECT ANSWER B. Located on employer owned property and used by employees and their dependents Reference Section 3.2 - 1 Nontaxable Fringe Benefits Once GTL Insurance coverage becomes taxable, it is subject to: A. FITW and FUTA only B. SS/Medi and FUTA only C. FITW only D. SS/Medi only - CORRECT ANSWER D. Social Security/Medicare only Reference Section 3.3 - 1 Life Insurance What is the annual limit of an EE Dependent Care Assistance account? A. $5,000 B. $7,500 C. No limit D. $8,000 - CORRECT ANSWER A. $5,000 (2014 & 2015 Limit) Reference Section 3.4 - 8 Dependent Care Assistance Programs Health Care Flexible Spending Arrangements can only reimburse medical expenses during the: A. Prior quarter B. Prior month C. Current month D. Coverage period - CORRECT ANSWER D. Coverage period Reference Section 4.5 - 7 Flexible Spending Arrangements At the beginning of the year an EE elects to buy medical and dental as a part of the company's cafeteria plan. During the year the EE has the option to change benefits: A. At any time B. Upon a qualifying event C. Never D. By filling out a new W-4 - CORRECT ANSWER B. Upon a qualifying event Reference Section 4.5 - 4 Benefit Elections EFTPS stands for: A. Electronic Funding Tax Payer Services B. Employment Federal Tax Payment System C. Electronic Federal Tax Payment System D. Electronic Funds Transfer Payment System - CORRECT ANSWER C. Electronic Federal Tax Payment System Reference Section 8.2 - 2 How to Deposit Payroll Taxes Any property or service that an ER provides to an EE on an infrequent or sporadic base, if the value of such property or service is so minimal that accounting for it would be unreasonable or administratively impractical, is considered: A. Special accounting rule B. Working condition fringe C. De minimus fringe D. Non-cash compensation - CORRECT ANSWER C. De minimus fringe Reference Section 3.2 - 1 Nontaxable Fringe Benefits The Experience Rate System: A. Measures the amount of experience that EEs have in order to determine job placement B. Measures the unemployment claims activity of the ER for purposes of determining the ER's unemployment tax rate C. Measures the unemployment claims activity of the EE for purposes of determining the EE's unemployment tax rate D. Measures an EE's experience for purposes of determining promotion eligibility - CORRECT ANSWER B. Measures the unemployment claims activity of the employer for purposes of determining the employer's unemployment tax rate Reference Section 7.2 - 3 Contribution Rates and Experience Rating An annuity that provides retirement income for EEs of certain public schools and certain non-profit organizations is: A. 403(b) B. 457 C. 401(k) D. 414(h) - CORRECT ANSWER A. 403(b) Reference Section 4.6 - 3 Tax Sheltered Annuities A retirement plan in the form of an annuity or mutual fund for the EEs of public sector ERs is: A. 403(b) B. 457 C. 401(k) D. 414(h) - CORRECT ANSWER B. 457 Reference Section 4.6 - 2 Cash or Deferred Arrangements An ER may exclude a business expense reimbursement from income when the EE's expenses meet which of the following requirements? A. Reimbursements are made with regular payroll. B. Expenses are substantiated and excess advances are returned timely. C. Expenses are business-related, substantiated, and excess advances are retained for future travel. D. Expenses are business-related, substantiated, and excess advances are returned timely. - CORRECT ANSWER D. Expenses are business-related, substantiated, and excess advances are returned timely. Reference Section 3.3 - 5 Employee Business Travel Expense Reimbursement Bob is a real estate agent. His office expects him to be available in the office from 9:00 am to 3:00 p.m. and from 6:00 p.m. to 9:00 p.m. daily . Bob is: A. An independent contractor B. A statutory EE C. A statutory nonEE D. An EE - CORRECT ANSWER C. A statutory nonemployee Reference Section 1.3 - 2 Statutory Nonemployees Which is not true of an accountable plan? A. EEs must have paid or incurred deductible expenses while performing services as your EEs. B. Amounts paid to EEs under an accountable plan are wages and are subject to income tax withholding. C. EEs must adequately account to you for expenses within a reasonable period of time. D. EEs must return any amounts in excess of expenses within a reasonable period of time. - CORRECT ANSWER B. Amounts paid to employees under an accountable plan are wages and are subject to income tax withholding. Reference Section 3.3 - 5 Employee Business Travel Expense Reimbursement Under a cafeteria plan how can EEs obtain or purchase benefits? A. Flex dollars - ER paid B. Salary reduction - pretax dollars C. Payroll deductions - post tax dollars D. All of the above - CORRECT ANSWER D. All of the above Reference Section 4.5 - 4 Benefit Elections An EE receives serious car accident injuries on Feb 15, 2014 and does not return to work until Nov 1, 2014. Through what date must the ER withhold and pay SS, Medi and FUTA taxes on sick pay given to the EE by the ER? A. July 15, 2014 B. August 15, 2014 C. August 31, 2014 D. September 1, 2014 - CORRECT ANSWER C. August 31, 2014 Reference Section 4.3 - 2 Sick Pay Under a Separate Plan ERISA stands for: A. Employee Retirement Income Security Act B. Employer Reporting Insurance Standards Act C. Employer Required Insurance Security Act D. Employment Reconciliation Income Standards Act - CORRECT ANSWER A. Employee Retirement Income Security Act Reference Payroll Source Glossary Nontaxable 3PSP is reported in Box 12, preceded by which of the following codes? A. M B. J C. C D. P - CORRECT ANSWER B. J Reference Section 4.3 - 2 Sick Pay Under a Separate Plan When ERs are determining their quarterly FUTA tax liability for the first three calendar quarter, what should they assume? A. 6.0% of their FUTA taxable wages will be due each quarter B. 5.4% of their FUTA taxable wages will be due each quarter C. No deposits should be made until 4th quarter when they file their annual 940 D. 0.6% of their FUTA taxable wages will be due each quarter - CORRECT ANSWER D. 0.6% of their FUTA taxable wages will be due each quarter (2014 & 2015 Rate) Reference Section 7.1 - 5 Depositing and Paying FUTA Tax The major objective of basic classification code for workers' compensations is to: A. Group EE's activities by risk B. Establish common exception classes C. Identify national council states D. Group similar business entities by common operating risk - CORRECT ANSWER D. Group similar business entities by common operating risk Reference Section 4.4 - 2 Premium Payments When an ER receives Form 668-W from the IRS, when must the ER begin to withhold and remit? A. With the first payment of wages after receipt of Form 668-W B. Within 14 days after receipt of Form 668-W C. Within 30 days after receipt of Form 668-W D. Within 30 days after receipt of Form 668-W or the first date of payment of wages, whichever is later - CORRECT ANSWER A. With the first payment of wages after receipt of Form 668-W Reference Section 9.1-1 Tax Levies The taxable and tax amounts for ER paid GTL premiums for coverage over $50,000 are reported on the W-2 as: A. Excluded from Box 1, included in Boxes 3 and 5, Box 12 coded "C" B. Included in Boxes 1, 3 and 5, Box 12 Code "C" C. Included in Boxes 1, 2, 3, and 5, Box 12 coded "G" D. Excluded from Box 1, included in Boxes 3 and 5, Box 12 coded "G" - CORRECT ANSWER B. Included in Boxes 1, 3 and 5, Box 12 Code "C" Reference Section 3.3 - 1 Life Insurance The final FUTA payment for the year is due on: A. 01/15 B. 12/31 C. 01/31 D. 02/15 - CORRECT ANSWER C. 01/31 Reference Section 7.1 - 5 Depositing and Paying FUTA Tax Tip allocations are needed if the total tips reported are less than what % of ER's gross receipts? A. 10% B. 8% C. 12% D. 28% - CORRECT ANSWER B. 8% (2014 & 2015 Rate) Reference Section 3.4 - 27 Tips An ER that pays contributions to more than one state UI fund must file: A. Form 940 B. Form 944 C. Form 941 D. Form 941c - CORRECT ANSWER A. Form 940 Reference Section 7.1 Federal Unemployment Insurance Exempt, hourly paid computer professionals must be paid not less than how much per hour? A. $27.63 B. $33.48 C. $4.75 D. $5.15 - CORRECT ANSWER A. $27.63 (2014 & 2015 Rate) Reference Section 2.4 - 1 White Collar Exemption Which of the following plans BEST describes a cafeteria plan under Section 125 of the IRC? A. A quantified and accountable expense reimbursement plan B. A tax-qualified retirement plan which meets special needs C. A plan which permits EEs to select from two or more qualified taxable and nontaxable benefits D. A plan whereby EEs may request that pretax dollars be set aside in a qualified retirement account until age 59 - CORRECT ANSWER C. A plan which permits employees to select from two or more qualified taxable and nontaxable benefits Reference Section 4.5 Cafeteria Plans ABCco filed Forms 1099-MISC for workers that should have been classified as EEs. What penalties will be assessed to for improper worker classification? A. 40% of FICA and 3.0% of FIT B. 20% of FICA and 1.5% of FIT C. 100% of FICA and 100% of FIT D. 97% abatement - CORRECT ANSWER B. 20% of FICA and 1.5% of FIT Reference Section 1.7 - 1 IRS Penalties For what travel expenses may an ER use the high-low per diem rate instead of the individual federal per diem rate of the locality of travel? A. Lodging, not just meals and incidentals, and the travel is within CONUS B. Lodging, meals and incidentals, not just meals and incidentals, and the travel is within CONUS C. Meals and incidental expenses, and the travel is outside CONUS D. None of the above - CORRECT ANSWER B. Lodging, meals and incidentals, not just meals and incidentals, and the travel is within CONUS Reference Section 3.5 - 5 Employee Business Travel Expense Requirements Which statement below defines "Tax Deferred" wages and "Tax Exempt" wages? A. "Tax Deferred" means that taxes will be due at some later period in time. "Tax Exempt" means that taxes will never be due. B. "Tax Deferred" means that taxes will never be due. "Tax Exempt" means that taxes will be due at some later period in time. C. "Tax Deferred" and "Tax Exempt" both mean that taxes will never be due. D. "Tax Deferred" and "Tax Exempt" both mean that taxes will be due at some later period in time. - CORRECT ANSWER A. "Tax Deferred" means that taxes will be due at some later period in time. "Tax Exempt" means that taxes will never be due. An ER must file a Form 940 if: A. EEs were employed on any day in the current or preceding calendar year B. EEs were employed on any day in any 20 weeks in the current or preceding calendar year C. EEs were employed on any 20 different days in the current or preceding calendar year D. 20 EEs or more were employed on any day in the current or preceding calendar year - CORRECT ANSWER B. Employees were employed on any day in any 20 weeks in the current or preceding calendar year Reference Section 7.1 - 1 Who Must Pay FUTA Tax An EE who works for more than one ER and has exceeded the SS wage base may: A. Get a refund on their personal income tax return B. Demand that the ER refund the coverage C. Apply the Social Security tax to next year's withholdings D. Apply the overage to benefits paid at age 65 - CORRECT ANSWER A. Get a refund on their personal income tax return Reference Section 6.7 - 1 Social Security and Medicare Tax Rates Payments to independent contractors must be reported to the IRS if payments meet or exceed: A. $600 for the year B. $600 in the last 12 months C. $1,000 for the year D. $1,500 for the year - CORRECT ANSWER A. $600 for the year Reference Section 8.12 - 1 Miscellaneous Payments Made by Businesses Bob gets injured on the job and receives workers' compensation benefits. These benefit payments are exempt from: A. EE/ER SS and Medi B. Federal C. All employment tax and withholding D. Medi only - CORRECT ANSWER C. All employment tax and withholding Reference Section 4.4 Workers Compensation Insurance FLSA requires ERs to give EEs a day off on national holidays and to give EEs paid vacations if: A. EE's work on these holidays B. EE's work over 40 hours in the week C. Never D. Local banks are closed. - CORRECT ANSWER C. Never Reference Section 2.1 Federal Wage Hour Law BOX 12 CODE: Value of Group Term Life Insurance (GTL) over $50,000 - CORRECT ANSWER C BOX 12 CODE: SIMPLE Retirement Account contributions - CORRECT ANSWER S BOX 12 CODE: Adoption benefits - CORRECT ANSWER T BOX 12 CODE: Designated Roth contributions under a section 403(b) salary reduction agreement - CORRECT ANSWER BB BOX 12 CODE: Uncollected social security tax on tips - CORRECT ANSWER A BOX 12 CODE: Section 403(b) elective deferrals - CORRECT ANSWER E BOX 12 CODE: Nonstatutory stock options - CORRECT ANSWER V BOX 12 CODE: Nontaxable part of employee business expense reimbursements - CORRECT ANSWER L BOX 12 CODE: Designated Roth contributions under a governmental 457(b) plan - CORRECT ANSWER EE BOX 12 CODE: Nontaxable Combat pay for military employers - CORRECT ANSWER Q BOX 12 CODE: Employer contributions to a Health Savings Account - CORRECT ANSWER W BOX 12 CODE: Tax on excess golden parachute payments - CORRECT ANSWER K BOX 12 CODE: Section 501(c) (18)(D) elective deferrals - CORRECT ANSWER H BOX 12 CODE: Uncollected Medicare tax on value of GTL insurance $50,000 - CORRECT ANSWER N BOX 12 CODE: Excludable moving expense reimbursements paid to EE - CORRECT ANSWER P BOX 12 CODE: Section 401(k) elective deferrals - CORRECT ANSWER D BOX 12 CODE: Designated Roth contributions under a section 401(k) plan - CORRECT ANSWER AA BOX 12 CODE: Deferrals to 409A non-qualified Deferred Comp Plan - CORRECT ANSWER Y BOX 12 CODE: Medical savings account contributions - CORRECT ANSWER R BOX 12 CODE: Uncollected social security tax on value of GTL insurance $50K - CORRECT ANSWER M BOX 12 CODE: Section 457(b) elective deferrals - CORRECT ANSWER G BOX 12 CODE: Sick pay not included as income - CORRECT ANSWER J BOX 12 CODE: Uncollected Medicare tax on tips - CORRECT ANSWER B BOX 12 CODE: Cost of employer-sponsored health coverage - CORRECT ANSWER DD BOX 12 CODE: Section 408(k)(6) elective deferrals - CORRECT ANSWER F BOX 12 CODE: Income under section 409A non-qualified Deferred Comp Plan - CORRECT ANSWER Z Which form might be submitted to the Social Security Administration (SSA) to receive a determination letter of a worker's status? a. SS-4 b. SS-5 c. SS-8 d. None of the above - CORRECT ANSWER d. None of the above Reference 1.2 - 2 Reasonable Basis Test The SS-8 is submitted to the IRS, not the SSA. From what taxes are cafeteria plan contributions generally exempt? a. SS, Medi, FIT, and FUTA b. FIT and SIT c. SS, Medi, FUTA, and SUI d. SS, Medi, FIT, and SIT - CORRECT ANSWER a. Social Security, Medicare, FIT, and FUTA Reference 4.5 Cafeteria Plans IRS regulations define all of the following types as supplemental payments EXCEPT: a. Shift differential b. Severance c. Tips d. Retroactive Pay - CORRECT ANSWER a. Shift differential Reference 6.4 - 4 Supplemental Wage Payments When processing a direct deposit, the automated clearing house (ACH) file is a file a. transmitting payments from the payroll system b. provided by Federal Reserve Regulation Q c. of employee authorization d. from the receiving financial institution - CORRECT ANSWER a. transmitting payments from the payroll system Reference 5.3 - 2 Direct Deposits Which of the following is not a de minimis fringe benefit? a. Occasional tickets to sporting events b. Subscription to business periodicals c. Traditional holiday gifts (e.g. turkeys, candy) d. Occasional personal use of company telephone - CORRECT ANSWER b. Subscription to business periodicals Reference 3.2 - 1 Nontaxable Fringe Benefits According to IRS regulations, wages are taxable and subject to employment tax when actually paid or made available to employees without substantial limitation. This is known as: a. Constructive Payment (Receipt) b. Claim of Right c. Special Accounting Rule d. Wage offset method - CORRECT ANSWER a. Constructive Payment (Receipt) Reference Section 6.1 the Principle of Actual or Constructive Payment Which of the following laws establish minimum wage and overtime standards for non-exempt EEs? a. Federal Insurance Contribution Act b. Age Discrimination in Employment Act c. Fair Labor Standards Act d. Civil Rights Act - CORRECT ANSWER c. Fair Labor Standards Act Reference Section 2.1 Federal Wage-Hour Law Bob works in Massachusetts, where the minimum wage is currently $8.00 per hour. The federal minimum wage is $7.25 per hour. What is the least hourly wage that Bob's ER may pay him? a. $7.50 b. $8.00 c. $7.25 d. Either A, B, or C - Employer may choose - CORRECT ANSWER b. $8.00 Reference Section 2.5 Minimum Wage 27. What is the maximum EE contribution to 401(k) for 2014? a. $5,500 b. $15,500 c. $18,000 d. $17,500 - CORRECT ANSWER d. $17,500 (2014 Limit) c. 18,000 (2015 Limit) Reference Section 4.6 - 2 Cash or Deferred Arrangements For supplemental withholding, what is the federal income tax rate for payments such as bonuses, commissions, and back pay awards, etc.? a. 31% b. 28% c. 25% (39.6% if $1M) d. 10% - CORRECT ANSWER c. 25% (39.6% if $1M) (2014 & 2015 Rate) Reference Section 6.4 - 4 Supplemental Wage Payments An ER must withhold SS/Medi tax: a. Regardless of the age of the employee b. Only from EEs under age 70 c. Only from EEs under the age of 65 d. Only from EEs under the age of 75 - CORRECT ANSWER a. Regardless of the age of the employee Reference Section 6.7 - 3 Calculating the Withholding Amounts The term Per Diem is best described as: a. Within the pay period b. With each occurrence c. Within a fiscal year d. Within a day - CORRECT ANSWER d. Within a day Reference Section 3 A covered full-time EE with a qualified reason must be allowed how many weeks off under the Family and Medical Leave Act? a. 16 b. 8 c. 12 d. 20 - CORRECT ANSWER c. 12 Reference Section 4.2 Family and Medical Leave Act An example of a non-taxable fringe benefit would be: a. Cash awards b. Working condition fringe benefits c. An athletic facility not owned or operated by the ER d. Meals for business travel with no overnight stay - CORRECT ANSWER b. Working condition fringe benefits Reference Section 3.2 - 1 Nontaxable Fringe Benefits Which of the following is not covered by FLSA? a. Minimum work age and treatment of minors in the work force b. Equal pay for equal work c. Overtime for exempt EEs d. Public service contracts - CORRECT ANSWER c. Overtime for exempt employees Reference Section 2.1 Federal Wage-Hour Law Using the special accounting rule an ER can: a. Add the value of fringe benefits to earnings at any time. b. Treat the value of benefits from the last 2 months of the year as being paid the following year. c. Does not have to add in the value of the fringe benefits to employee earnings. d. Can add half the value of the benefit in the current year and the other half the following year. - CORRECT ANSWER b. Treat the value of benefits from the last 2 months of the year as being paid the following year. Reference Section 3.5 - 2 Withholding and Reporting on Noncash Fringe Benefits When determining the value of ER-provided parking, what valuation method is allowed? a. ER's cost b. EE's cost c. Lower of the EE's cost or fair market value d. EE's fair market value - CORRECT ANSWER d. Employee's fair market value Reference Section 3.1 - 2 Fair Market Value What employee taxes must be paid on 401(k) contributions? a. SS and Medi taxes b. Federal Income Tax c. SS, Medi, and Federal Income Taxes d. None of the above - CORRECT ANSWER a. Social Security and Medicare taxes Reference Section 4.6 - 2 Cash or Deferred Arrangements (401K) Payments for Statutory EEs are: a. Subject to FITW and not subject to SS/Medi b. Not subject to FITW and subject to SS/Medi c. Subject to FITW and subject to Social Security/Medicare d. Not subject to either FITW or SS/Medi - CORRECT ANSWER b. Not subject to FITW and subject to Social Security/Medicare Reference Section 1.3 - 1 Statutory Employee What amount of Employer paid GTL insurance for an EE is exempt from taxes? a. The premium amount for coverage over $50,000 b. The premium amount for coverage over $2,000 c. The premium amount for coverage up to $50,000 d. The premium amount for coverage up to $2,000 - CORRECT ANSWER c. The premium amount for coverage up to $50,000 Reference Section 3.3 - 1 Life Insurance What form would be used if an ER/EE desires a ruling on a worker's status? a. Form W-4 b. Form 2441 c. Form SS-8 d. Form 8109 - CORRECT ANSWER c. Form SS-8 Reference Section 1.2 - 2 Reasonable Basis Test A newly hired EE who is married with two children fails to complete Form W-4 by the first payday. What withholding status does the ER use when calculating the EE's withholding? a. Married, 2 allowances b. Married, 3 allowances c. Single, 2 allowances d. Single, 0 allowances - CORRECT ANSWER d. Single, 0 allowances Reference Section 6.3 - 1 Form W-4 The 8/80 Rule for overtime applies to: a. Health Care workers b. Government EEs c. Public School EEs d. Police and firefighters - CORRECT ANSWER a. Health Care workers Reference Section 2.6 - 1 The Work Week A worker may waive the right to be classified as an EE: a. Never b. By signing a contract c. By not submitting a W-4 d. By claiming exempt on a W-4 - CORRECT ANSWER a. Never Reference Section 1.2 Employee vs. Independent Contractor A 20% EE discount on services qualifies as tax free if: a. The ER incurs no substantial additional cost for providing the service to the EE b. Items, if paid for in full by the EE, could be deducted as business expenses on a personal tax return c. The value of items is so small as to make accounting for it unreasonable d. Services are offered for sale to customers in the ordinary course of line of business - CORRECT ANSWER d. Services are offered for sale to customers in the ordinary course of line of business Reference Section 3.2 - 1 Nontaxable Fringe Benefits An example of an non-exempt EE would be: a. Lawyer b. Teacher c. CEO d. Piece-worker - CORRECT ANSWER d. Piece-worker Reference Section 2.4 Exempt and Nonexempt employees What is the maximum contribution for a section 457 plan? a. $18,000 b. $8,500 c. $17,500 d. $7,500 - CORRECT ANSWER c. $17,500 (2014 Limit) a. $18,000 (2015 Limit) Reference Section 4.6 - 4 Deferred Compensation Plan for the Public Sector A 20% EE discount on services qualifies as tax-free if: a. The ER incurs no substantial additional cost for providing the service to the EE b. Items, if paid for in full by the EE, could be deducted as business expenses on a personal tax return c. The value of items is so small as to make accounting for it unreasonable d. Services are offered for sale to customers in the ordinary course of line of business - CORRECT ANSWER d. Services are offered for sale to customers in the ordinary course of line of business Reference Section 3.2 - 1 Nontaxable Fringe Benefits FLSA governs: MOECPR - CORRECT ANSWER Minimum Wage Overtime Equal Pay for Equal Work Child Labor Restrictions Public Service Contracts Recordkeeping Exempt Employees: CAPES - CORRECT ANSWER Computer Professionals Administrative Professionals Executives Salespersons Statutory Employee: DISH - CORRECT ANSWER Drivers Insurance Salespersons Salespersons Homeworkers Statutory Non-Employee: REDS - CORRECT ANSWER Real Estate Agents Direct Sales FLSA covers: CROME - CORRECT ANSWER Child Labor Recordkeeping Overtime Minimum Wage Equal Pay for Equal Work Balance Sheet Formula: ALOE - CORRECT ANSWER Assets = Liabilies + Owners Equity Burned by the Sun - use ALOE Income Statement Formula - CORRECT ANSWER Revenue - Expenses = Net income or loss LIMIT: ADOPTION ASSISTANCE - CORRECT ANSWER Adoption Assistance: $13,190 (2014 Limit) $13,400 (2015 Limit) RATE: COMMUTING VALUATION - CORRECT ANSWER Commuting Valuation: $1.50 ($3.00 round trip) (2014 & 2015 Rate) RATE: COMPUTER PROFESSIONAL WAGE - CORRECT ANSWER Computer Professional Wage: $27.63 (2014 & 2015 Rate) LIMIT: DEPENDENT CARE LIMIT - CORRECT ANSWER Dependent Care Limit: $5,000 ($2,500 married filing sep) (2014 & 2015 Limit) LIMIT: EDUCATIONAL ASSISTANCE - CORRECT ANSWER Education Assistance: $5,250 (2014 & 2015 Limit) LIMIT: FOREIGN EARNED INCOME EXLUSION - CORRECT ANSWER Foreign Earned Income Exclusion: $99,200 (2014 Limit) $100,800 (2015 Limit) RATE: FUEL (EMPLOYER PROVIDED) - CORRECT ANSWER Fuel (Employer Provided): $0.055 or 5.5 cents per mile (2014 & 2015 Rate) LIMIT: GROUP TERM LIFE INSURANCE - CORRECT ANSWER Group Term Life Insurance Limit: $50,000 (2014 & 2015 Limit) RATE: MEDICARE RATE - CORRECT ANSWER Medicare Rate: 1.45% (0.9% over $200,000) (2014 & 2015 Rate) RATE: MILEAGE RATE (CENTS PER MILE) - CORRECT ANSWER Mileage Rate (cents per mile): $0.56 or 56 cents (2014 Limit) $0.57 or 57 cents (2015 Limit) RATE: MINIMUM WAGE (FEDERAL) - CORRECT ANSWER Minimum Wage (Federal): $7.25 (2014 & 2015 Rate) RATE: MOVING MILEAGE - CORRECT ANSWER Moving Mileage: $0.235 or 23.5 cents (2014 Rate) $0.23 or 23 cents (2015 Rate) RATE: OPPORTUNITY WAGE (EE UNDER 20, 1ST 90 DAYS) - CORRECT ANSWER Opportunity Wage (EE under 20, 1st 90 days): $4.25 (2014 & 2015 Rate) LIMIT: PARKING (QUALIFIED) - CORRECT ANSWER Parking (Qualified): $250 (2014 & 2015 Limit) RATE: SOCIAL SECURITY RATE (EMPLOYEE) - CORRECT ANSWER Social Security Rate (Employee): 6.2% (2014 & 2015 Rate) LIMIT: SOCIAL SECURITY WAGE - CORRECT ANSWER Social Security Wage Limit: $117,000 (2014 Limit) $118,500 (2015 Limit) RATE: SUPPLEMENTAL FEDERAL WITHHOLDING (LESS THAN $1M) - CORRECT ANSWER Supplemental Withholding less than $1M: 25% (2014 & 2015 Rate) RATE: SUPPLEMENTAL FEDERAL WITHHOLDING (OVER $1M) - CORRECT ANSWER Supplemental Withholding over $1M: 39.6% (2014 & 2015 Rate) RATE: TIP WAGE/CREDIT - CORRECT ANSWER Tip Wage/Credit: $2.13 / $5.12 (2014 & 2015 Rate) RATE: TIP ALLOCATION - CORRECT ANSWER Tip Allocation: 8% of gross receipts (2014 & 2015 Rate) LIMIT: TRANSPORTATION/ VANPOOL - CORRECT ANSWER Transportation/Vanpool: $130 (2014 & 2015 Limit) LIMIT: 401K MAXIMUM CONTRIBUTION - CORRECT ANSWER 401k Maximum Contribution: $17,500 (2014 Limit) $18,000 (2015 Limit) LIMIT: 401K CATCH-UP CONTRIBUTION (OVER AGE 50) - CORRECT ANSWER 401k Catch-Up Contribution (over age 50): $5,500 (2014 Limit) $6,000 (2015 Limit) PAYROLL TAX FORM: I-9 - CORRECT ANSWER PAYROLL TAX FORM: I-9 EMPLOYMENT ELIGIBILTY VERIFICATION AGENCY: DOHS Used by employers to verify an employee's right to work in the US. PAYROLL TAX FORM: SS-4 - CORRECT ANSWER PAYROLL TAX FORM: SS-4 APPLICATION FOR EMPLOYER FEDERAL ID AGENCY: IRS PAYROLL TAX FORM: This Federal ID is assigned to sole proprietors, corporations, partnerships, estates, trusts, and other entities for tax filing and reporting purposes PAYROLL TAX FORM: SS-8 - CORRECT ANSWER PAYROLL TAX FORM: SS-8 DETERMINATION OF WORKER STATUS AGENCY: IRS Firms and workers file Form SS-8 to request a determination of the status of a worker for purposes of Federal employment taxes and income tax withholding PAYROLL TAX FORM: SSA-131 - CORRECT ANSWER PAYROLL TAX FORM: SSA-131 EMPLOYER REPORT OF SPECIAL WAGE PAYMENTS AGENCY: SSA To report wages paid to an EE that were for services that were performed in years prior to the tax year including payments in lieu of vacation, accumulated sick payments, payments "on account of retirement," bonuses, stock options. PAYROLL TAX FORM: W-2 - CORRECT ANSWER PAYROLL TAX FORM: W-2 WAGE AND TAX STATEMENT AGENCY: IRS To report an employee's wages and taxes for the year. PAYROLL TAX FORM: W-3 - CORRECT ANSWER PAYROLL TAX FORM: W-3 TRANSMITTAL OF WAGE AND TAX STATEMENTS AGENCY: IRS To transmit Copy A of form(s) W-2. PAYROLL TAX FORM: W-4 - CORRECT ANSWER PAYROLL TAX FORM: W-4 EMPLOYEE'S WITHHOLDING ALLOWANCE CERTIFICATE AGENCY: IRS To be completed by EE so that their employer can withhold the correct federal income tax from their pay. Informs the ER of marital status and any exemptions. PAYROLL TAX FORM: W4-P - CORRECT ANSWER PAYROLL TAX FORM: W-4P WITHHOLDING CERTIFICATE FOR PENSIONS OR ANNUITY PAYMENTS AGENCY: IRS For US citizens, resident aliens, or their estates who are recipients of pensions, annuities and certain other deferred compensation. Informs the payer of the correct amount of federal income tax to withhold from their payments. PAYROLL TAX FORM: W-4S - CORRECT ANSWER PAYROLL TAX FORM: W-4S REQUEST FOR FEDERAL INCOME TAX WITHHOLDING FROM SICK PAY AGENCY: IRS Given to a third-party payer of sick pay, such as an insurance company, if the individual wants federal income tax withheld from the payments. PAYROLL TAX FORM: W-7 - CORRECT ANSWER PAYROLL TAX FORM: W-7 APPLICATION FOR IRS INDIVIDUAL TIN AGENCY: IRS This is for individuals who are not eligible to obtain an SSN but who must furnish a taxpayer ID number (e.g. a nonresident alien or a US resident alien not eligible for an SSN.) PAYROLL TAX FORM: W-8BEN - CORRECT ANSWER PAYROLL TAX FORM: W-8BEN CERTIFICATE OF FOREIGN STATUS OF BENEFICIAL OWNER FOR US TAX WITHHOLDING AGENCY: IRS PAYROLL TAX FORM: W-9 - CORRECT ANSWER PAYROLL TAX FORM: W-9 REQUEST FOR TIN AND CERTIFICATION AGENCY: IRS To request a taxpayer ID number of a US person and to request certain certifications and claims for exemption. For individuals, this is generally their SSN. PAYROLL TAX FORM: 668-D - CORRECT ANSWER PAYROLL TAX FORM: 668-D RELEASE OF LEVY/RELEASE OF PROPERTY FROM LEVY SOURCE: IRS According to form 668-W, the employer must continue to withhold and make levy payments until it receives this form. This form will contain the final amount due and release the employee's wages from levy after that amount is paid. PAYROLL TAX FORM: 668-W - CORRECT ANSWER PAYROLL TAX FORM: 668-W NOTICE ON LEVY ON WAGES, SALARY, AND OTHER INCOME SOURCE: IRS This instructs employers to remit amounts withheld for levy on the same day wages are paid to the employee. The first payment should accompany part 3 of the form. PAYROLL TAX FORM: 673 - CORRECT ANSWER PAYROLL TAX FORM: 673 STATEMENT FOR CLAIMING EXEMPTION FROM WITHHOLDING ON FOREIGN EARNED INCOME ELIGIBLE FOR THE EXCLUSION(S) PROVIDED BY SECTION 911 AGENCY: IRS Filed with an EE's US ER to claim an exemption from US income tax withholding on wages earned abroad to the extent of the foreign earned income exclusion and foreign housing exclusion. PAYROLL TAX FORM: 843 - CORRECT ANSWER PAYROLL TAX FORM: 843 CLAIM FOR REFUND AND REQUEST FOR ABATEMENT AGENCY: IRS For employers to request an abatement or refund of interest or penalties. PAYROLL TAX FORM: 940 - CORRECT ANSWER PAYROLL TAX FORM: 940 EMPLOYER'S ANNUAL FEDERAL UNEMPLOYMENT (FUTA) TAX RETURN AGENCY: IRS For ER's to report unemployment tax paid to the IRS as well as to report State unemployment wages and taxes for each state in which they do business. PAYROLL TAX FORM: 941 - CORRECT ANSWER PAYROLL TAX FORM: 941 EMPLOYER'S QUARTERLY FEDERAL TAX RETURN AGENCY: IRS Due last day of QE month. 10 day ext for timely deposits For ER's to report payroll taxes for the quarter, current quarter adjustments to SS and Medi for fractions of cents, sick pay, tips, and GTL insurance, and prior quarter adjustments to payroll taxes PAYROLL TAX FORM: 941-M - CORRECT ANSWER PAYROLL TAX FORM: 941-M EMPLOYER'S MONTHLY FEDERAL TAX RETURN AGENCY: IRS Due 15th of following month ER's that fail to withhold or deposit taxes or file returns on time may be required by the IRS to report employment taxes monthly. PAYROLL TAX FORM: 941-X - CORRECT ANSWER PAYROLL TAX FORM: 941-X ADJUSTED EMPLOYER'S QUARTERLY FEDERAL TAX RETURN OR CLAIM FOR REFUND AGENCY: IRS PAYROLL TAX FORM: 943 - CORRECT ANSWER PAYROLL TAX FORM: 943 EMPLOYER'S ANNUAL FEDERAL TAX RETURN FOR AGRICULTURAL EMPLOYEES AGENCY: IRS Due 1/31, 10 day ext for timely deposits For ER's to report federal income tax withheld and ER & EE social security and medicare taxes on wages paid to farmworkers. PAYROLL TAX FORM: 944 - CORRECT ANSWER PAYROLL TAX FORM: 944 EMPLOYER'S ANNUAL FEDERAL TAX RETURN AGENCY: IRS Due 1/31, 10 day ext for timely deposits Purpose is same as 941; however, ER's with less than $1,000 in tax liability for the year file this annual return instead of the quarterly 941. PAYROLL TAX FORM: 945 - CORRECT ANSWER PAYROLL TAX FORM: 945 ANNUAL RETURN OF WITHHELD FEDERAL INCOME TAX AGENCY: IRS Due 1/31, 10 day ext for timely deposits Used to report withheld federal income tax from nonpayroll payments such as pension, military retirement, gambling winnings, Indian gaming profits, voluntary withholding on certain government payments, backup withholding PAYROLL TAX FORM: 972CG - CORRECT ANSWER PAYROLL TAX FORM: 972CG IRS PENALTY NOTICE AGENCY: IRS IRS notification to employers of missing or late information PAYROLL TAX FORM: 1042 - CORRECT ANSWER PAYROLL TAX FORM: 1042 ANNUAL WITHHOLDING TAX RETURN FOR US SOURCE INCOME OF FOREIGN PERSONS AGENCY: IRS To report tax withheld on certain income of foreign persons, including nonresident aliens, foreign partnerships, foreign corporations, foreign estates, and foreign trusts. Like a foreign 941 filed annually. PAYROLL TAX FORM: 1042-S - CORRECT ANSWER PAYROLL TAX FORM: 1042-S FOREIGN PERSON'S US SOURCE INCOME SUBJECT TO WITHHOLDING AGENCY: IRS Due 3/15 To report income and to report the amounts withheld for each employee. Like a foreign W-2 PAYROLL TAX FORM: 1042-T - CORRECT ANSWER PAYROLL TAX FORM: 1042-T ANNUAL SUMMARY AND TRANSMITTAL OF FORMS 1042-S AGENCY: IRS To transmit paper forms 1042-S to the IRS. Like a foreign W-3. PAYROLL TAX FORM: 1096 - CORRECT ANSWER PAYROLL TAX FORM: 1096 ANNUAL SUMMARY AND TRANSMITTAL OF US INFORMATION RETURNS AGENCY: IRS To transmit paper forms 1099, 1098, 5498, and W-2G to the IRS. PAYROLL TAX FORM: 1099-LTC - CORRECT ANSWER PAYROLL TAX FORM: 1099-LTC LONG-TERM CARE AND ACCELERATED DEATH BENEFITS AGENCY: IRS A payer, i.e. Ins Co, must give this form to an individual for payments made under a long-term care insurance contract or for accelerated death benefits. Payments include those made directly to the individual and those made to third partes. PAYROLL TAX FORM: 1099 MISC - CORRECT ANSWER PAYROLL TAX FORM: 1099 MISC MISCELLANEOUS INCOME AGENCY: IRS Used to report misc income for any person who has been paid: at least $10 in royalties or broker payments, at least $600 in rents, services, prizes & awards, other income payments, medical & health care payments, crop insurance proceeds, etc. PAYROLL TAX FORM: 1099-R - CORRECT ANSWER PAYROLL TAX FORM:1099-R DISTRIBUTIONS FROM PENSIONS, ANNUITIES, RETIREMENT OR PROFIT-SHARING PLANS, IRAS, INS CONTACTS, ETC AGENCY: IRS To reports income from pensions, annuities, retirement, profit sharing, IRAs, insurance contracts, ect PAYROLL TAX FORM: 1099-SA - CORRECT ANSWER PAYROLL TAX FORM: 1099-SA DISTRIBUTIONS FRON AN HSA, ARCHER MSA, OR MEDICARE ADVANTAGE MSA AGENCY: IRS To report distributions from an items noted above. The distribution may have been paid directly to a medical service provider or to the account holder. PAYROLL TAX FORM: 2032 - CORRECT ANSWER PAYROLL TAX FORM: 2032 CONTRACT COVERAGE UNDER TITLE II OF THE SOCIAL SECURITY ACT AGENCY: IRS For use by an American ER to extend social security coverage to US citizens and resident aliens employed by its foreign affiliates. PAYROLL TAX FORM: 2159 - CORRECT ANSWER PAYROLL TAX FORM: 2159 PAYROLL DEDUCTION AGREEMENT SOURCE: AGENCY An EE who owes federal taxes can avoid a levy by entering into an agreement with the IRS. They can then complete this form to request that their employer withhold a certain amount and pay it to the IRS. PAYROLL TAX FORM: 4070 - CORRECT ANSWER PAYROLL TAX FORM: 4070 EMPLOYEE'S REPORT OF TIPS TO EMPLOYER AGENCY: IRS For EEs to report tips received to their ER. They must be reported each month unless they received less than $20 in tips in a month.