Question 1

When you pay supplemental wages at the same time as regular wages, the method of calculating the withholding is the same for vacation payments as for semiannual bonuses.

Accepted Answer

A) True 
 B)False

Question 2

In calculating a "gross-up" amount of a bonus payment, an employer does not use the OASDI/HI tax rates in the formula.

Accepted Answer

A) True 
 B)False

Question 3

The withholding of federal income and FICA taxes from a tipped employee is made from the employee's wages that are under the employer's control.

Accepted Answer

A) True 
 B)False

Question 4

The standard deduction varies according to whether the wage-bracket method or the percentage method is used.

Accepted Answer

A) True 
 B)False

Question 5

A personal allowance:

Accepted Answer

A)  amounted to $2,000 in 2014. 
B)  may be claimed to exempt a portion of the employee's earnings from withholding. 
C)  is indexed for inflation every calendar quarter. 
D)  may be claimed at the same time with each employer for whom an employee is working during the year. 
E)  for one person is a different amount for a single versus a married taxpayer. 
A)  amounted to $2,000 in 2014. 
B)  may be claimed to exempt a portion of the employee's earnings from withholding. 
C)  is indexed for inflation every calendar quarter. 
D)  may be claimed at the same time with each employer for whom an employee is working during the year. 
E)  for one person is a different amount for a single versus a married taxpayer.

Question 6

Gere became the father of triplets on June 20. He must file an amended Form W-4 on or before June 30.

Accepted Answer

A) True 
 B)False

Question 7

All of the following are properly defined as wages subject to the withholding of federal income taxes except:

Accepted Answer

A)  year-end bonus. 
B)  kitchen appliances given by manufacturer in lieu of cash wages. 
C)  dismissal payment. 
D)  vacation pay. 
E)  payments made under worker's compensation law. 
A)  year-end bonus. 
B)  kitchen appliances given by manufacturer in lieu of cash wages. 
C)  dismissal payment. 
D)  vacation pay. 
E)  payments made under worker's compensation law.

Question 8

Which of the following noncash fringe benefits does not represent taxable income subject to federal income tax withholding?

Accepted Answer

A)  Flight on employer-provided airline 
B)  Personal use of company car 
C)  Sick pay 
D)  Employer-paid membership to a country club 
E)  All of the above are taxable. 
A)  Flight on employer-provided airline 
B)  Personal use of company car 
C)  Sick pay 
D)  Employer-paid membership to a country club 
E)  All of the above are taxable.

Question 9

An employer must withhold federal income taxes on both the tips reported by tipped employees and the tips that the employer allocates to the employees.

Accepted Answer

A) True 
 B)False

Question 10

Beech refuses to state her marital status on Form W-4 which she gave to you, the payroll manager, when she was hired. You should:

Accepted Answer

A)  tell Beech that it is OK since you know that she was recently divorced and is reluctant to talk about it. 
B)  inform Beech that she will have to write the IRS and give her reasons for refusing to state her marital status. 
C)  tell Beech that you will have to withhold income taxes as if she were married and had claimed one allowance. 
D)  tell Beech that you will have to withhold income taxes according to the withholding table for a single employee with no allowances. 
E)  advise Beech to write "It is no business of yours." in the margin of her Form W-4. 
A)  tell Beech that it is OK since you know that she was recently divorced and is reluctant to talk about it. 
B)  inform Beech that she will have to write the IRS and give her reasons for refusing to state her marital status. 
C)  tell Beech that you will have to withhold income taxes as if she were married and had claimed one allowance. 
D)  tell Beech that you will have to withhold income taxes according to the withholding table for a single employee with no allowances. 
E)  advise Beech to write "It is no business of yours." in the margin of her Form W-4.

Question 11

The payments to a cook employed by a college fraternity are excluded from federal income tax withholding.

Accepted Answer

A) True 
 B)False

Question 12

If married employees do not claim their marital status on Form W-4, the employer must withhold according to the withholding tables for single employees.

Accepted Answer

A) True 
 B)False

Question 13

Persons eligible for deductible IRA contributions may put aside a specified amount of their compensation without paying federal income taxes on that amount.

Accepted Answer

A) True 
 B)False

Question 14

Employees must be given Form W-2 on or before January 31 following the close of the calendar year.

Accepted Answer

A) True 
 B)False

Question 15

On August 6, Hunt filed an amended Form W-4 to show a decrease in the number of allowances claimed. Hunt's employer must put the new withholding allowance certificate into effect before the next weekly payday on August 8.

Accepted Answer

A) True 
 B)False

Question 16

Which of the following forms is used to report the amount of distributions from pension and retirement plans?

Accepted Answer

A)  Form W-2c 
B)  Form 1099-R 
C)  Form 1099-PEN 
D)  Form W-3p 
E)  Form W-4 
A)  Form W-2c 
B)  Form 1099-R 
C)  Form 1099-PEN 
D)  Form W-3p 
E)  Form W-4

Question 17

Which of the following cannot be included in a cafeteria plan?

Accepted Answer

A)  Health insurance 
B)  Group-term life insurance (first $50,000 of coverage) 
C)  Dependent care assistance (first $5,000) 
D)  Self-insured medical reimbursement plan 
E)  Educational assistance 
A)  Health insurance 
B)  Group-term life insurance (first $50,000 of coverage) 
C)  Dependent care assistance (first $5,000) 
D)  Self-insured medical reimbursement plan 
E)  Educational assistance

Question 18

For which of the following payments is the employer required to withhold federal income taxes?

Accepted Answer

A)  Advances made to sales personnel for traveling expenses 
B)  Tipped employee's monthly tips of $120 
C)  Deceased person's wages paid to the estate 
D)  Minister of Presbyterian church 
E)  All of the above 
A)  Advances made to sales personnel for traveling expenses 
B)  Tipped employee's monthly tips of $120 
C)  Deceased person's wages paid to the estate 
D)  Minister of Presbyterian church 
E)  All of the above

Question 19

In the case of a 401(k) plan, employees age 50 or over can shelter an extra $10,000 of their wages from federal income tax.

Accepted Answer

A) True 
 B)False

Question 20

An employer is required to submit a copy of the employee's Form W-4 to the IRS if the employee has claimed 15 or more withholding allowances.

Accepted Answer

A) True 
 B)False

When you pay supplemental wages at the same time as regular wages, the method of calculating the withholding is the same for vacation payments as for semiannual bonuses.

In calculating a "gross-up" amount of a bonus payment, an employer does not use the OASDI/HI tax rates in the formula.

The withholding of federal income and FICA taxes from a tipped employee is made from the employee's wages that are under the employer's control.

The standard deduction varies according to whether the wage-bracket method or the percentage method is used.

A personal allowance:

Gere became the father of triplets on June 20. He must file an amended Form W-4 on or before June 30.

All of the following are properly defined as wages subject to the withholding of federal income taxes except:

Which of the following noncash fringe benefits does not represent taxable income subject to federal income tax withholding?

An employer must withhold federal income taxes on both the tips reported by tipped employees and the tips that the employer allocates to the employees.

Beech refuses to state her marital status on Form W-4 which she gave to you, the payroll manager, when she was hired. You should:

The payments to a cook employed by a college fraternity are excluded from federal income tax withholding.

If married employees do not claim their marital status on Form W-4, the employer must withhold according to the withholding tables for single employees.

Persons eligible for deductible IRA contributions may put aside a specified amount of their compensation without paying federal income taxes on that amount.

Employees must be given Form W-2 on or before January 31 following the close of the calendar year.

On August 6, Hunt filed an amended Form W-4 to show a decrease in the number of allowances claimed. Hunt's employer must put the new withholding allowance certificate into effect before the next weekly payday on August 8.

Which of the following forms is used to report the amount of distributions from pension and retirement plans?

Which of the following cannot be included in a cafeteria plan?

For which of the following payments is the employer required to withhold federal income taxes?

In the case of a 401(k) plan, employees age 50 or over can shelter an extra $10,000 of their wages from federal income tax.

An employer is required to submit a copy of the employee's Form W-4 to the IRS if the employee has claimed 15 or more withholding allowances.

The Need for Payroll and Personnel Records

Computing Wages and Salaries

Social Security Taxes

Unemployment Compensation Taxes

Analyzing and Journalizing Payroll Transactions

Filters

Exam 4: Income Tax Withholding

When you pay supplemental wages at the same time as regular wages, the method of calculating the withholding is the same for vacation payments as for semiannual bonuses.

In calculating a "gross-up" amount of a bonus payment, an employer does not use the OASDI/HI tax rates in the formula.

The withholding of federal income and FICA taxes from a tipped employee is made from the employee's wages that are under the employer's control.

The standard deduction varies according to whether the wage-bracket method or the percentage method is used.

A personal allowance:

Gere became the father of triplets on June 20. He must file an amended Form W-4 on or before June 30.

All of the following are properly defined as wages subject to the withholding of federal income taxes except:

Which of the following noncash fringe benefits does not represent taxable income subject to federal income tax withholding?

An employer must withhold federal income taxes on both the tips reported by tipped employees and the tips that the employer allocates to the employees.

Beech refuses to state her marital status on Form W-4 which she gave to you, the payroll manager, when she was hired. You should:

The payments to a cook employed by a college fraternity are excluded from federal income tax withholding.

If married employees do not claim their marital status on Form W-4, the employer must withhold according to the withholding tables for single employees.

Persons eligible for deductible IRA contributions may put aside a specified amount of their compensation without paying federal income taxes on that amount.

Employees must be given Form W-2 on or before January 31 following the close of the calendar year.

On August 6, Hunt filed an amended Form W-4 to show a decrease in the number of allowances claimed. Hunt's employer must put the new withholding allowance certificate into effect before the next weekly payday on August 8.

Which of the following forms is used to report the amount of distributions from pension and retirement plans?

Which of the following cannot be included in a cafeteria plan?

For which of the following payments is the employer required to withhold federal income taxes?

In the case of a 401(k) plan, employees age 50 or over can shelter an extra $10,000 of their wages from federal income tax.

An employer is required to submit a copy of the employee's Form W-4 to the IRS if the employee has claimed 15 or more withholding allowances.

The Need for Payroll and Personnel Records

Computing Wages and Salaries

Social Security Taxes

Unemployment Compensation Taxes

Analyzing and Journalizing Payroll Transactions

Filters