Question 1

A nondeductible penalty is imposed on underpayments of estimated taxes.

Accepted Answer

A) True 
 B)False

Question 2

Emily is a self-employed attorney during 2014.
a.​Assuming that Emily earns $20,000 from her practice, calculate the total amount of her self-employment tax liability for 2014.
b.​Assuming that Emily earns $135,000 from her practice, calculate the total amount of her self-employment tax liability for 2014.

Accepted Answer

The answer of Emily is a self-employed attorney during 2014.
a.​Assuming...

Question 3

For each of the following payments, indicate the form (Form W-2, W-4, W-2G, 1099-B, 1099-DIV, 1099-INT, 1099-MISC, or 1099-R) that should be used to report the payment.
a.Dividends from a mutual fund
b.Las Vegas gambling winnings
c.Interest paid by a bank
d.Payment of salary and commissions to an employee
e.Distribution from an IRA account

Accepted Answer

The answer of For each of the following payments, indicate...

Question 4

An individual who expects to receive more than $500 of income from sources other than wages meets the requirements for having to file quarterly estimated tax payments.

Accepted Answer

A) True 
 B)False

Question 5

Ellen uses the head of household filing status and has a dependent daughter. Ellen has self-employment income of $310,000 as an architect and $10,000 of self-employment losses from a jewelry making business.
a. What is Ellen's 0.9% additional Medicare tax for 2014?
b. Is Ellen allowed to deduct a portion of this with her other Medicare taxes as an adjustment for AGI on the front page of her income tax return?

Accepted Answer

a. $900 = ($310,000

Question 6

Karen is single with no dependents and earns $18,000 a year. She gives her employer a Form W-4 on which she claims 17 allowances. What is her employer required to do about the Form W-4? Explain.

Accepted Answer

The employer is not required t

Question 7

In 2014, Willow Corporation had three employees. Two of the employees worked full-time and earned salaries of $25,000 each. The third employee worked only part-time and earned $3,000. The employer timely paid state unemployment tax equal to 5.4 percent of each employee's wages up to $7,000. How much unemployment tax was paid to the state from Willow Corporation for 2014?

Accepted Answer

A) $136 
B) $168 
C) $918 
D) $1,134 
E) None of the above 
A) $136 
B) $168 
C) $918 
D) $1,134 
E) None of the above

Question 8

Employees with self-employment income who also have W-2 wage income may be able to avoid making estimated tax payments by filing a Form W-4 and increasing the amount of their withholding.

Accepted Answer

A) True 
 B)False

Question 9

For purposes of the new additional 0.9% Medicare surtax on earned income, a single taxpayer having earned income of more than $200,000 is generally subject to the tax.

Accepted Answer

A) True 
 B)False

Question 10

Dividends paid to a shareholder by a corporation should be reported on which of the following forms?

Accepted Answer

A) 1099-INT 
B) 1099-DIV 
C) 1099-MISC 
D) 1099-R 
E) None of the above 
A) 1099-INT 
B) 1099-DIV 
C) 1099-MISC 
D) 1099-R 
E) None of the above

Question 11

In 2014, the maximum amount of wages subject to the Social Security portion of the FICA tax is $117,000.

Accepted Answer

A) True 
 B)False

Question 12

Steve is a single man who lives by himself. He has one job as a computer tech. How many withholding allowances can he claim?

Accepted Answer

A) 2 
B) 3 
C) 5 
D) 10 
E) He can claim any number of withholding allowances that he believes will leave him with proper withholding. 
A) 2 
B) 3 
C) 5 
D) 10 
E) He can claim any number of withholding allowances that he believes will leave him with proper withholding.

Question 13

A credit against the FUTA tax is available for state unemployment tax paid by the employer.

Accepted Answer

A) True 
 B)False

Question 14

Mark has two jobs during 2014. One employer withheld and paid FICA taxes on $70,200 of Mark's salary and the other employer withheld and paid FICA taxes on $47,400 in salary paid to Mark. Calculate the amount of Mark's credit for the overpayment of FICA taxes that he should claim on his 2014 Form 1040.

Accepted Answer

$37.20 = 6

Question 15

Which of the following items may be subject to the self-employment tax?

Accepted Answer

A) A partner's distributive share of partnership income 
B) Dividend income 
C) Capital gains 
D) Interest income 
E) None of the above 
A) A partner's distributive share of partnership income 
B) Dividend income 
C) Capital gains 
D) Interest income 
E) None of the above

Question 16

Which of the following statements is true with regard to the reimbursement of employee business expenses?

Accepted Answer

A) Reimbursements of ordinary and necessary expenses are subject to federal income tax withholding. 
B) Excess reimbursements of ordinary and necessary expenses are never subject to withholding. 
C) Reimbursements received by an employee under a plan which contains a requirement to return excess amounts, and the employee does so, are automatically excluded from the definition of wages subject to withholding. 
D) Provided that reimbursements are received by an employee under a plan which requires the employee to substantiate the expenses to his employer, the amounts are automatically excluded from the definition of wages subject to withholding, without regard to whether the employee actually substantiates the expenditures. 
E) All of the above are true statements. 
A) Reimbursements of ordinary and necessary expenses are subject to federal income tax withholding. 
B) Excess reimbursements of ordinary and necessary expenses are never subject to withholding. 
C) Reimbursements received by an employee under a plan which contains a requirement to return excess amounts, and the employee does so, are automatically excluded from the definition of wages subject to withholding. 
D) Provided that reimbursements are received by an employee under a plan which requires the employee to substantiate the expenses to his employer, the amounts are automatically excluded from the definition of wages subject to withholding, without regard to whether the employee actually substantiates the expenditures. 
E) All of the above are true statements.

Question 17

What percentage of gross food and beverage sales is used in determining the amount of tips that an employer must report as allocated to employees?

Accepted Answer

A) 8 percent 
B) 10 percent 
C) 12 percent 
D) 15 percent 
E) None of the above 
A) 8 percent 
B) 10 percent 
C) 12 percent 
D) 15 percent 
E) None of the above

Question 18

Mark the correct answer. Self-employment taxes:

Accepted Answer

A) Consist of a Medicare tax and a Social Security tax. 
B) Are not affected by wages the taxpayer earns as an employee. 
C) Apply to taxpayers with less than $400 in self-employment earnings. 
D) Are calculated based on unearned income such as interest and dividends as well as net earnings from self-employment. 
A) Consist of a Medicare tax and a Social Security tax. 
B) Are not affected by wages the taxpayer earns as an employee. 
C) Apply to taxpayers with less than $400 in self-employment earnings. 
D) Are calculated based on unearned income such as interest and dividends as well as net earnings from self-employment.

Question 19

What is the purpose of backup withholding?

Accepted Answer

The purpose is to ensure income tax is p

Question 20

Melody and Todd are married and have employee wages of $250,000 each in 2014. They have no other income. How much additional 0.9% Medicare surtax will Melody and Todd have to pay or receive as a refund when they file their 2014 income tax return? ​

Accepted Answer

A) $1,350 will be due with their return in addition to amounts withheld. 
B) $1,350 will be refunded with their return. 
C) $900 will be refunded with their return. 
D) $3,600 will be due with their return in addition to amounts withheld. 
A) $1,350 will be due with their return in addition to amounts withheld. 
B) $1,350 will be refunded with their return. 
C) $900 will be refunded with their return. 
D) $3,600 will be due with their return in addition to amounts withheld.

A nondeductible penalty is imposed on underpayments of estimated taxes.

An individual who expects to receive more than $500 of income from sources other than wages meets the requirements for having to file quarterly estimated tax payments.

Karen is single with no dependents and earns $18,000 a year. She gives her employer a Form W-4 on which she claims 17 allowances. What is her employer required to do about the Form W-4? Explain.

Employees with self-employment income who also have W-2 wage income may be able to avoid making estimated tax payments by filing a Form W-4 and increasing the amount of their withholding.

For purposes of the new additional 0.9% Medicare surtax on earned income, a single taxpayer having earned income of more than $200,000 is generally subject to the tax.

Dividends paid to a shareholder by a corporation should be reported on which of the following forms?

In 2014, the maximum amount of wages subject to the Social Security portion of the FICA tax is $117,000.

Steve is a single man who lives by himself. He has one job as a computer tech. How many withholding allowances can he claim?

A credit against the FUTA tax is available for state unemployment tax paid by the employer.

Which of the following items may be subject to the self-employment tax?

Which of the following statements is true with regard to the reimbursement of employee business expenses?

What percentage of gross food and beverage sales is used in determining the amount of tips that an employer must report as allocated to employees?

Mark the correct answer. Self-employment taxes:

What is the purpose of backup withholding?

Melody and Todd are married and have employee wages of $250,000 each in 2014. They have no other income. How much additional 0.9% Medicare surtax will Melody and Todd have to pay or receive as a refund when they file their 2014 income tax return?

The Individual Income Tax Return

Gross Income and Exclusions

Business Income and Expenses, Part I

Business Income and Expenses, Part II

Itemized Deductions and Other Incentives

Credits and Special Taxes

Accounting Periods and Methods and Depreciation

Capital Gains and Losses

Partnership Taxation

The Corporate Income Tax

Tax Administration and Tax Planning

Filters

Exam 9: Withholding, Estimated Payments, and Payroll Taxes

A nondeductible penalty is imposed on underpayments of estimated taxes.

An individual who expects to receive more than $500 of income from sources other than wages meets the requirements for having to file quarterly estimated tax payments.

Karen is single with no dependents and earns $18,000 a year. She gives her employer a Form W-4 on which she claims 17 allowances. What is her employer required to do about the Form W-4? Explain.

Employees with self-employment income who also have W-2 wage income may be able to avoid making estimated tax payments by filing a Form W-4 and increasing the amount of their withholding.

For purposes of the new additional 0.9% Medicare surtax on earned income, a single taxpayer having earned income of more than $200,000 is generally subject to the tax.

Dividends paid to a shareholder by a corporation should be reported on which of the following forms?

In 2014, the maximum amount of wages subject to the Social Security portion of the FICA tax is $117,000.

Steve is a single man who lives by himself. He has one job as a computer tech. How many withholding allowances can he claim?

A credit against the FUTA tax is available for state unemployment tax paid by the employer.

Which of the following items may be subject to the self-employment tax?

Which of the following statements is true with regard to the reimbursement of employee business expenses?

What percentage of gross food and beverage sales is used in determining the amount of tips that an employer must report as allocated to employees?

Mark the correct answer. Self-employment taxes:

What is the purpose of backup withholding?

Melody and Todd are married and have employee wages of $250,000 each in 2014. They have no other income. How much additional 0.9% Medicare surtax will Melody and Todd have to pay or receive as a refund when they file their 2014 income tax return? ​

The Individual Income Tax Return

Gross Income and Exclusions

Business Income and Expenses, Part I

Business Income and Expenses, Part II

Itemized Deductions and Other Incentives

Credits and Special Taxes

Accounting Periods and Methods and Depreciation

Capital Gains and Losses

Partnership Taxation

The Corporate Income Tax

Tax Administration and Tax Planning

Filters

Melody and Todd are married and have employee wages of $250,000 each in 2014. They have no other income. How much additional 0.9% Medicare surtax will Melody and Todd have to pay or receive as a refund when they file their 2014 income tax return?