Exam 4: Fringe Benefits and Voluntary Deductions

According to the Consumer Credit Protection Act, what is the maximum percentage of an employee's disposable earnings that may be withheld as part of a consumer credit garnishment?

What differentiates 401(k) and a 403(b) retirement plans?

Ross is a full-time employee in Lansing, Michigan, who earns $42,000 annually, paid semimonthly. His federal income tax is $155.00. What is the maximum amount that may be withheld from his pay for a child-support garnishment, assuming he is not in arrears? (Do not round intermediate calculations, only round final answer to two decimal points. Michigan has a 4.25% flat tax.)

If a fringe benefit involves a deduction from employee pay, which of the following is true?

According to Bureau of Labor Statistics, what percentage of additional compensation is commonly offered as fringe benefits?

Under the unsafe conditions rule:

Employers benefit by offering POPs because they reduce ________.

Under the lease-value rule, how is the taxable income for the employee determined? (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box for a wrong Answer. Any boxes left with a question mark will be automatically graded as incorrect.)

Which of the following must accompany a Health Savings Account (HSA) to be considered part of a cafeteria plan?

Frances McNale is an employee who drives a 2019 Ford C-Max with a fair-market value of $29,500. The lease value is $7,750, according to Publication 15-b. If the car was available for 150 days during the year, what is the prorated annual lease percentage, using the lease-value rule? (Do not round intermediate Calculations, only round final answer to two decimal points.)

Fringe benefits and employee satisfaction have no correlation.

Fringe benefits are monetary or nonmonetary compensation given to employees in return for their service to the company.

What method(s) may be used to determine the fair market value of the personal use of a company car? (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the Box for a wrong answer. Any boxes left with a question mark will be automatically graded as incorrect.)

Michael McBride is an employee of Reach-it Pharmaceuticals. His company car is a 2019 Lexus GS 200t with a fair-market value of $50,000 and a lease value of $13,250, according to Publication 15-b. During the year, Michael drove 45,000 miles, of which 9,000 were for personal use. The car was available for use on 270 of the days during the year. All gasoline was provided by the employer and is charged back to Michael at $0.055 per mile. What is the amount of the Company-car fringe benefit that will appear on Michael's W-2, using the lease-value rule? (Do not round intermediate calculations, only round final answer to Two decimal points.)

Which of the following may be included as part of an employee's Section 125 "cafeteria" plan?

Which of the following is true about 401(k) retirement plans?

Under the ________, benefits offered only during the last two months of the calendar year may be treated as paid during the following calendar year.

In which type of retirement plan does the company offer employees the ability to earn company stock for the duration of their employment?

Under what condition is the fringe benefit of a gym membership taxable?

Premiums for insurance purchased through qualified cafeteria plans may be deducted from an employee's pay on a pre-tax basis.