Exam 2
50 Questions | Multiple Choice | Answers & Rationales Included
1. What form must an employee complete to determine federal income tax
withholding?
A. Form W-4
B. Form W-4
C. Form W-2
D. Form 1099
The W-4 form is used by employees to inform employers of their tax situation for
withholding purposes.
2. What is the current federal minimum wage as of 2025?
A. $9.25
B. $10.00
C. $7.25
D. $8.50
Federal minimum wage remains at $7.25/hour unless superseded by state law.
3. Which of the following taxes is paid entirely by the employer?
A. Medicare
B. Social Security
, C. FUTA
D. State income tax
Federal Unemployment Tax Act (FUTA) is funded solely by employers.
4. The Social Security wage base limit for 2025 is:
A. $147,000
B. $150,000
C. $168,600
D. $200,000
The Social Security wage base is the maximum earnings subject to Social
Security tax.
5. What is the FICA tax rate for employees in 2025?
A. 5.65%
B. 6.20%
C. 7.65%
D. 8.25%
FICA includes 6.2% for Social Security and 1.45% for Medicare.
6. What form summarizes total wages and taxes withheld for an employee
annually?
A. 940
B. W-4
C. W-2
D. 1095-C
Form W-2 reports wages and tax withholding to employees and the IRS.