Background Check & Tax Compliance Screening Exam
Practice Questions And Correct Answers (Verified
Answers) Plus Rationales 2026 Q&A | Instant Download
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SECTION 1: BACKGROUND CHECK FUNDAMENTALS & LEGAL FRAMEWORK
Question 1
What is the primary purpose of a pre-employment background check?
A) To verify the applicant's age
B) To evaluate the applicant's character and suitability for the position
C) To determine the applicant's salary expectations
D) To assess the applicant's physical fitness
Answer: B — To evaluate the applicant's character and suitability for the
position
Rationale: Background checks are used to verify an applicant's identity, work
eligibility, criminal history, and references to ensure they are suitable for the
position. This is particularly important for positions involving trust, responsibility,
and access to sensitive information such as Federal Tax Information (FTI) .
Question 2
Which federal law governs employer background checks and candidate rights?
A) The Privacy Act of 1974
B) The Fair Credit Reporting Act (FCRA)
C) The Civil Rights Act of 1964
D) The Americans with Disabilities Act
Answer: B — The Fair Credit Reporting Act (FCRA)
,Rationale: The Fair Credit Reporting Act (FCRA) protects you when a background
check is used for employment. You have the right to know a check is being run, to
see what's in your report, and to dispute anything that's wrong. You also get
advance notice before an employer makes a decision based on negative
information .
Question 3
What must an employer obtain before running a background check with a
background reporting company?
A) Verbal permission only
B) Written permission from the applicant
C) Permission from a supervisor
D) No permission is required
Answer: B — Written permission from the applicant
Rationale: Employers must get your written permission before running a
background check with a background reporting company. This permission must be
given in writing in a standalone document .
Question 4
What is a "consumer report" in the context of employment background checks?
A) A report about product purchases
B) The official term for a background check report
C) A credit card statement
D) A customer satisfaction survey
Answer: B — The official term for a background check report
Rationale: "Consumer report" is the official term for a background check report. A
consumer reporting agency pulls together the information the employer ordered
, (criminal records, employment history, education verification, whatever applies)
and delivers it in a report for employers to review when making hiring decisions .
Question 5
According to IRS Publication 1075, what are the minimum background check
requirements for persons with access to Federal Tax Information (FTI)?
A) Only a credit check
B) Fingerprint checks, local law enforcement checks, and citizenship verification
C) Only a criminal history check
D) Only reference verification
Answer: B — Fingerprint checks, local law enforcement checks, and citizenship
verification
Rationale: IRS Pub 1075 requires that background checks must include, at a
minimum, fingerprint checks (as permitted by the FBI), local law enforcement
checks, and citizenship verification .
Question 6
What is "adverse action" in the context of employment background checks?
A) A promotion based on the background check
B) An employer considering not hiring you based on something in your
background check
C) A request for additional information
D) A positive employment decision
Answer: B — An employer considering not hiring you based on something in
your background check
Rationale: Adverse action means an employer is considering not hiring you based
on something in your background check. Before they can make that final decision,
they have to give you notice and a chance to respond .
Practice Questions And Correct Answers (Verified
Answers) Plus Rationales 2026 Q&A | Instant Download
SECTION 1: BACKGROUND CHECK FUNDAMENTALS & LEGAL FRAMEWORK
Question 1
What is the primary purpose of a pre-employment background check?
A) To verify the applicant's age
B) To evaluate the applicant's character and suitability for the position
C) To determine the applicant's salary expectations
D) To assess the applicant's physical fitness
Answer: B — To evaluate the applicant's character and suitability for the
position
Rationale: Background checks are used to verify an applicant's identity, work
eligibility, criminal history, and references to ensure they are suitable for the
position. This is particularly important for positions involving trust, responsibility,
and access to sensitive information such as Federal Tax Information (FTI) .
Question 2
Which federal law governs employer background checks and candidate rights?
A) The Privacy Act of 1974
B) The Fair Credit Reporting Act (FCRA)
C) The Civil Rights Act of 1964
D) The Americans with Disabilities Act
Answer: B — The Fair Credit Reporting Act (FCRA)
,Rationale: The Fair Credit Reporting Act (FCRA) protects you when a background
check is used for employment. You have the right to know a check is being run, to
see what's in your report, and to dispute anything that's wrong. You also get
advance notice before an employer makes a decision based on negative
information .
Question 3
What must an employer obtain before running a background check with a
background reporting company?
A) Verbal permission only
B) Written permission from the applicant
C) Permission from a supervisor
D) No permission is required
Answer: B — Written permission from the applicant
Rationale: Employers must get your written permission before running a
background check with a background reporting company. This permission must be
given in writing in a standalone document .
Question 4
What is a "consumer report" in the context of employment background checks?
A) A report about product purchases
B) The official term for a background check report
C) A credit card statement
D) A customer satisfaction survey
Answer: B — The official term for a background check report
Rationale: "Consumer report" is the official term for a background check report. A
consumer reporting agency pulls together the information the employer ordered
, (criminal records, employment history, education verification, whatever applies)
and delivers it in a report for employers to review when making hiring decisions .
Question 5
According to IRS Publication 1075, what are the minimum background check
requirements for persons with access to Federal Tax Information (FTI)?
A) Only a credit check
B) Fingerprint checks, local law enforcement checks, and citizenship verification
C) Only a criminal history check
D) Only reference verification
Answer: B — Fingerprint checks, local law enforcement checks, and citizenship
verification
Rationale: IRS Pub 1075 requires that background checks must include, at a
minimum, fingerprint checks (as permitted by the FBI), local law enforcement
checks, and citizenship verification .
Question 6
What is "adverse action" in the context of employment background checks?
A) A promotion based on the background check
B) An employer considering not hiring you based on something in your
background check
C) A request for additional information
D) A positive employment decision
Answer: B — An employer considering not hiring you based on something in
your background check
Rationale: Adverse action means an employer is considering not hiring you based
on something in your background check. Before they can make that final decision,
they have to give you notice and a chance to respond .
