Question 1

A person holding two jobs may have additional income tax withheld by increasing the number of withholding allowances claimed.

Accepted Answer

A) True 
 B)False  False

Question 2

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  False

Question 3

If you,an employer,are filing 550 Forms W-2,you must use electronic filing rather than paper Forms W-2.

Accepted Answer

A) True 
 B)False  True

Question 4

Arch gives you an amended Form W-4 dated March 10,2017 on which he claims two additional withholding allowances.He asks you to refund the excess taxes that were deducted from January 1 to March 10 when Arch claimed only one withholding allowance.You should:

Accepted Answer

A)  repay the overwithheld taxes on Arch's next payday. 
B)  tell Arch that you will spread out a refund of the overwithheld taxes equally over the next six pays. 
C)  inform Arch that you are unable to repay the overwithheld taxes that were withheld before
March 10 and that the adjustment will have to be made when he files his annual income tax return. 
D)  tell Arch to write the IRS immediately and ask for a refund of the overwithheld taxes. 
E)  inform Arch that you will appoint a committee to study his request. 
A)  repay the overwithheld taxes on Arch's next payday. 
B)  tell Arch that you will spread out a refund of the overwithheld taxes equally over the next six pays. 
C)  inform Arch that you are unable to repay the overwithheld taxes that were withheld before
March 10 and that the adjustment will have to be made when he files his annual income tax return. 
D)  tell Arch to write the IRS immediately and ask for a refund of the overwithheld taxes. 
E)  inform Arch that you will appoint a committee to study his request.

Question 5

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

Accepted Answer

A) True 
 B)False

Question 6

There is no limit to the amount that an employer can contribute in an employee's SIMPLE retirement account.

Accepted Answer

A) True 
 B)False

Question 7

After completion of Form W-4,an employer must copy the employee's social security card and place it in the employee's employment file.

Accepted Answer

A) True 
 B)False

Question 8

Exhibit 4-1:
Use the following tables to calculate your answers.   ​
​   ​Source: Internal Revenue Service  
-Refer to Exhibit 4-1.Determine the income tax to withhold from the biweekly wages of the following employees (wage-bracket):
Karen Overton (single,0 allowances),$900 wages
__________________
Nancy Haller (married,4 allowances),$1,000 wages
__________________
Alan Glasgow (married,1 allowance),$980 wages
__________________
Joseph Kerr (single,4 allowances),$720 wages
__________________
Ginni Lorenz (single,1 allowance),$580 wages
__________________

Accepted Answer

$106.00
$

Question 9

A personal allowance:

Accepted Answer

A)  amounted to $2,000 in 2017. 
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 2017. 
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 10

An employee submits an invalid Form W-4 to the employer and does not replace it with a valid form.The employer should withhold federal income taxes at the rate for a single person claiming no exemptions.

Accepted Answer

A) True 
 B)False

Question 11

A waiter receives cash tips amounting to $120 in a month.The waiter must report the amount of the cash tips to the employer by the 10th of the month following the month they receive the tips.

Accepted Answer

A) True 
 B)False

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

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 14

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 15

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 16

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

Accepted Answer

A) True 
 B)False

Question 17

Of the two main methods of withholding,only the wage-bracket method distinguishes unmarried persons from married persons.

Accepted Answer

A) True 
 B)False

Question 18

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 19

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 20

For state income tax purposes,all states treat 401(k)plan payroll deductions as nontaxable.

Accepted Answer

A) True 
 B)False

A person holding two jobs may have additional income tax withheld by increasing the number of withholding allowances claimed.

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.

If you,an employer,are filing 550 Forms W-2,you must use electronic filing rather than paper Forms W-2.

Arch gives you an amended Form W-4 dated March 10,2017 on which he claims two additional withholding allowances.He asks you to refund the excess taxes that were deducted from January 1 to March 10 when Arch claimed only one withholding allowance.You should:

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

There is no limit to the amount that an employer can contribute in an employee's SIMPLE retirement account.

After completion of Form W-4,an employer must copy the employee's social security card and place it in the employee's employment file.

A personal allowance:

An employee submits an invalid Form W-4 to the employer and does not replace it with a valid form.The employer should withhold federal income taxes at the rate for a single person claiming no exemptions.

A waiter receives cash tips amounting to $120 in a month.The waiter must report the amount of the cash tips to the employer by the 10th of the month following the month they receive the tips.

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

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:

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

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

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

Of the two main methods of withholding,only the wage-bracket method distinguishes unmarried persons from married persons.

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

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

For state income tax purposes,all states treat 401(k)plan payroll deductions as nontaxable.

The Need for Payroll and Personal Records

Computing Wages and Salaries

Social Security Taxes

Unemployment Compensation Taxes

Analyzing and Journalizing Payroll

Filters

Exam 4: Income Tax Withholding

A person holding two jobs may have additional income tax withheld by increasing the number of withholding allowances claimed.

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.

If you,an employer,are filing 550 Forms W-2,you must use electronic filing rather than paper Forms W-2.

Arch gives you an amended Form W-4 dated March 10,2017 on which he claims two additional withholding allowances.He asks you to refund the excess taxes that were deducted from January 1 to March 10 when Arch claimed only one withholding allowance.You should:

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

There is no limit to the amount that an employer can contribute in an employee's SIMPLE retirement account.

After completion of Form W-4,an employer must copy the employee's social security card and place it in the employee's employment file.

A personal allowance:

An employee submits an invalid Form W-4 to the employer and does not replace it with a valid form.The employer should withhold federal income taxes at the rate for a single person claiming no exemptions.

A waiter receives cash tips amounting to $120 in a month.The waiter must report the amount of the cash tips to the employer by the 10th of the month following the month they receive the tips.

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

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:

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

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

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

Of the two main methods of withholding,only the wage-bracket method distinguishes unmarried persons from married persons.

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

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

For state income tax purposes,all states treat 401(k)plan payroll deductions as nontaxable.

The Need for Payroll and Personal Records

Computing Wages and Salaries

Social Security Taxes

Unemployment Compensation Taxes

Analyzing and Journalizing Payroll

Filters