Question 1

Directors of corporations who only attend and participate in board of directors' meetings are not covered as employees under FUTA.

Accepted Answer

A) True 
 B)False

Question 2

An employer must pay the quarterly FUTA tax liability if the liability is more than:

Accepted Answer

A)  $3,000. 
B)  $500. 
C)  $1,000. 
D)  $1. 
E)  $100.

Question 3

On Form 940, even if the total FUTA tax is more than $500, there is no listing of quarterly federal unemployment tax liabilities.

Accepted Answer

A) True 
 B)False

Question 4

Insurance agents paid solely on a commission basis are not considered employees under FUTA.

Accepted Answer

A) True 
 B)False

Question 5

Partnerships do not have to pay unemployment taxes on the wages of their employees.

Accepted Answer

A) True 
 B)False

Question 6

Deposit by the:

Accepted Answer

A)  end of the month after the quarter. 
B)  15th of the month after the quarter. 
C)  10th of the month after the quarter. 
D)  end of the following quarter. 
E)  same day of the FICA and FIT deposits.

Question 7

Form 940 must be mailed to the IRS by January 15.

Accepted Answer

A) True 
 B)False

Question 8

If the employer is tardy in paying the state contributions, the credit against the federal tax is limited to what percent of the late payments that would have been allowed as a credit if the contributions had been paid on time?

Accepted Answer

A)  6.2% 
B)  90% 
C)  5.13% 
D)  20% 
E)  0%

Question 9

Which of the following types of payments are not taxable wages for federal unemployment tax?

Accepted Answer

A)  Retirement pay 
B)  Cash prizes and awards for doing outstanding work 
C)  Dismissal pay 
D)  Bonuses as remuneration for services 
E)  Payment under a guaranteed annual wage plan

Question 10

Services performed in the employ of a religious organization that is exempt from federal income tax are also exempt from FUTA coverage.

Accepted Answer

A) True 
 B)False

Question 11

Once a company attains the status of employer for FUTA purposes, that status continues for four calendar years.

Accepted Answer

A) True 
 B)False

Question 12

Christmas gifts, excluding noncash gifts of nominal value, are taxable wages for unemployment purposes.

Accepted Answer

A) True 
 B)False

Question 13

In order to obtain the maximum credit allowed against the federal unemployment tax, the employer must have paid its SUTA contributions by the due date of Form 940.

Accepted Answer

A) True 
 B)False

Question 14

Unemployment taxes (FUTA and SUTA) do not have to be paid by an employer who has only part-time employees.

Accepted Answer

A) True 
 B)False

Question 15

Educational assistance payments made to workers to improve skills required of their jobs are nontaxable for unemployment purposes.

Accepted Answer

A) True 
 B)False

Question 16

Voluntary contributions to a state's unemployment department are:

Accepted Answer

A)  allowed in all states. 
B)  designed to increase an employer's reserve account in order to lower the employer's contribution rate. 
C)  capable of being paid at any time with no time limit. 
D)  returned to the employer at the end of the following year. 
E)  sent directly to the IRS.

Question 17

FUTA and SUTA coverages extend to U.S. citizens working abroad for American employers.

Accepted Answer

A) True 
 B)False

Question 18

For FUTA purposes, the cash value of remuneration paid in any medium other than cash is not considered taxable wages.

Accepted Answer

A) True 
 B)False

Question 19

Included under the definition of employees for FUTA purposes are:

Accepted Answer

A)  independent contractors. 
B)  insurance agents paid solely on commission. 
C)  student nurses. 
D)  officers of a corporation. 
E)  members of partnerships.

Question 20

In most states, the contribution reports and the wage information reports are filed quarterly.

Accepted Answer

A) True 
 B)False

Exam 5: Unemployment Compensation Taxes

Directors of corporations who only attend and participate in board of directors' meetings are not covered as employees under FUTA.

An employer must pay the quarterly FUTA tax liability if the liability is more than:

On Form 940, even if the total FUTA tax is more than $500, there is no listing of quarterly federal unemployment tax liabilities.

Insurance agents paid solely on a commission basis are not considered employees under FUTA.

Partnerships do not have to pay unemployment taxes on the wages of their employees.

Deposit by the:

Form 940 must be mailed to the IRS by January 15.

If the employer is tardy in paying the state contributions, the credit against the federal tax is limited to what percent of the late payments that would have been allowed as a credit if the contributions had been paid on time?

Which of the following types of payments are not taxable wages for federal unemployment tax?

Services performed in the employ of a religious organization that is exempt from federal income tax are also exempt from FUTA coverage.

Once a company attains the status of employer for FUTA purposes, that status continues for four calendar years.

Christmas gifts, excluding noncash gifts of nominal value, are taxable wages for unemployment purposes.

In order to obtain the maximum credit allowed against the federal unemployment tax, the employer must have paid its SUTA contributions by the due date of Form 940.

Unemployment taxes (FUTA and SUTA) do not have to be paid by an employer who has only part-time employees.

Educational assistance payments made to workers to improve skills required of their jobs are nontaxable for unemployment purposes.

Voluntary contributions to a state's unemployment department are:

FUTA and SUTA coverages extend to U.S. citizens working abroad for American employers.

For FUTA purposes, the cash value of remuneration paid in any medium other than cash is not considered taxable wages.

Included under the definition of employees for FUTA purposes are:

In most states, the contribution reports and the wage information reports are filed quarterly.