Question 1

Which of the following statements correctly describes the withholding of federal income taxes and social security taxes on tips?

Accepted Answer

A) Tips amounting to $10 or more in a calendar month must be reported by tipped employees to their employers. 
B) The withholding of federal income taxes on employees' reported tip income is made from the amount of tips reported by employees. 
C) When employees report taxable tips in connection with employment in which they also receive regular wages, the amount of tax to be withheld on the tips is computed as if the tips were a supplemental wage payment. 
D) Employers do not withhold FICA taxes on the tipped employees' reported tip income. 
E) None of the above statements is correct. 
A) Tips amounting to $10 or more in a calendar month must be reported by tipped employees to their employers. 
B) The withholding of federal income taxes on employees' reported tip income is made from the amount of tips reported by employees. 
C) When employees report taxable tips in connection with employment in which they also receive regular wages, the amount of tax to be withheld on the tips is computed as if the tips were a supplemental wage payment. 
D) Employers do not withhold FICA taxes on the tipped employees' reported tip income. 
E) None of the above statements is correct. C

Question 2

There is no limit to the amount of educational assistance that is exempt from federal income tax withholdings.

Accepted Answer

A) True 
 B)False  False

Question 3

Under the federal income tax withholding law, a definition of employee excludes partners.

Accepted Answer

A) True 
 B)False  True

Question 4

Since not-for-profit corporations are exempt from federal income taxes, they are not defined as employers under the federal income tax withholding law.

Accepted Answer

A) True 
 B)False

Question 5

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 6

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 7

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 8

On August 5, 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 9.

Accepted Answer

A) True 
 B)False

Question 9

In the case of a 401k) 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 10

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 11

Exhibit 4-1:
Use the following tables to calculate your answers.      
-Refer to Exhibit 4-1.Calculate the amount to withhold from the following employees using the biweekly table of the

Accepted Answer

$ 63.87a
$

Question 12

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 13

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 14

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 15

The IRA format of the SIMPLE plan allows employees to make tax-free contributions of up to $12,500

Accepted Answer

A) True 
 B)False

Question 16

In the IRA form of the Simple Retirement Account, employers must match the employee's contribution, dollar-for- dollar, up to 3 percent of the employee's compensation.

Accepted Answer

A) True 
 B)False

Question 17

By completing Form W-4P, a person can elect to have no income tax withheld from the annuity amounts the person receives.

Accepted Answer

A) True 
 B)False

Question 18

The special withholding allowance may be claimed only by those employees who do not itemize deductions on their income tax returns.

Accepted Answer

A) True 
 B)False

Question 19

Gere became the father of triplets on May 21.He must file an amended Form W-4 on or before May 31.

Accepted Answer

A) True 
 B)False

Question 20

Which of the following forms is used to report rents paid over $600 to landlords?

Accepted Answer

A) Form 1099-R 
B) Form 1099-INT 
C) Form 1099-MISC 
D) Form 1099-G 
E) Form 8027 
A) Form 1099-R 
B) Form 1099-INT 
C) Form 1099-MISC 
D) Form 1099-G 
E) Form 8027

Which of the following statements correctly describes the withholding of federal income taxes and social security taxes on tips?

There is no limit to the amount of educational assistance that is exempt from federal income tax withholdings.

Under the federal income tax withholding law, a definition of employee excludes partners.

Since not-for-profit corporations are exempt from federal income taxes, they are not defined as employers under the federal income tax withholding law.

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:

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.

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.

On August 5, 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 9.

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

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

Exhibit 4-1: Use the following tables to calculate your answers. -Refer to Exhibit 4-1.Calculate the amount to withhold from the following employees using the biweekly table of the

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?

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.

The IRA format of the SIMPLE plan allows employees to make tax-free contributions of up to $12,500

In the IRA form of the Simple Retirement Account, employers must match the employee's contribution, dollar-for- dollar, up to 3 percent of the employee's compensation.

By completing Form W-4P, a person can elect to have no income tax withheld from the annuity amounts the person receives.

The special withholding allowance may be claimed only by those employees who do not itemize deductions on their income tax returns.

Gere became the father of triplets on May 21.He must file an amended Form W-4 on or before May 31.

Which of the following forms is used to report rents paid over $600 to landlords?

The Need for Payroll and Personnel Records

Computing Wages and Salaries

Social Security Taxes

Unemployment Compensation Taxes

Analyzing and Journalizing Payroll

Filters

Exam 4: Income Tax Withholding

Which of the following statements correctly describes the withholding of federal income taxes and social security taxes on tips?

There is no limit to the amount of educational assistance that is exempt from federal income tax withholdings.

Under the federal income tax withholding law, a definition of employee excludes partners.

Since not-for-profit corporations are exempt from federal income taxes, they are not defined as employers under the federal income tax withholding law.

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:

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.

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.

On August 5, 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 9.

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

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

Exhibit 4-1: Use the following tables to calculate your answers. -Refer to Exhibit 4-1.Calculate the amount to withhold from the following employees using the biweekly table of the

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?

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.

The IRA format of the SIMPLE plan allows employees to make tax-free contributions of up to $12,500

In the IRA form of the Simple Retirement Account, employers must match the employee's contribution, dollar-for- dollar, up to 3 percent of the employee's compensation.

By completing Form W-4P, a person can elect to have no income tax withheld from the annuity amounts the person receives.

The special withholding allowance may be claimed only by those employees who do not itemize deductions on their income tax returns.

Gere became the father of triplets on May 21.He must file an amended Form W-4 on or before May 31.

Which of the following forms is used to report rents paid over $600 to landlords?

The Need for Payroll and Personnel Records

Computing Wages and Salaries

Social Security Taxes

Unemployment Compensation Taxes

Analyzing and Journalizing Payroll

Filters