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AIPB MASTERING PAYROLL EXAM 2025|ACTUAL
140 QUESTIONS AND ANSWERS|100%
VERIFIED|GRADED A+
If an employer unintentionally misclassifies an employee as an independent contractor and files Form 1099-MISC, the tax assessment for failure to withhold federal income tax is equal to: 1.5% of the wage amount On which form are wages reported? W- 2 Due on for Employee copies January 31 If an employer wants s a written determination from the IRS on a worker's status, which form should it submit? SS- 8 When the common-law test is met, an individual is considered? An employee Nonemployee compensation is reported on Form: 1099 - MISC
Employer payments to employees for services rendered are called Wages Employer payments to independent contractors are made as ordinary Payments A taxpayer identification number supplied by an independent contractor may be either an individual's ___________ ____________ number or a company's _____________ ___________ number. Social security , employer ID If an employer wishes to obtain a written determination from the IRS regarding an individual's worker status, it can submit Form _________________. SS- 8 While an employer is waiting for a written determination of an individual's worker status from the IRS, it should treat the individual as (a, an)
Employee
State laws covering the treatment of unclaimed wages are called ________________ laws. Escheat The federal law that governs minimum wage and overtime requirements is called Fair Labor Standards Act For businesses that began operations before April 1, 1990. Must comply with FLSA if gross annual sales are? Retail Enterprises $362,500 or more Nonretail Enterprises $250,000 or more Four Kinds of employees are exempt from the federal minimum wage Tipped employees Computer professionals, Recipients of the opportunity wage Outside sales persons The FLSA is enforced by the U.S. Department of Labor, ____________________ _______________ ________________ Division. wage and hour
At what rate must federal income tax be withheld for an employee who has not properly completed a W-4? single with zero allowances FUTA tax must be deposited when the cumulative quarterly tax liability exceeds: $ Employers can file the employment tax return annually (Form 944) if they anticipate their federal employment tax liability will not exceed: $1, State unemployment returns are generally filed: quarterly Form 1099 informational statements must be furnished o recipients no later than: January 31
At what rate must federal income tax be withheld for an employee who has not properly completed a W-4? single with zero allowance FUTA Federal Unemployment Tax FICA Federal Insurance Contributions Act (FICA) is made up of two separate taxes(OASDI) & (HI) to pay social security and Medicare taxes OASDI Old Age, Survivors, and Disability Insurance (OASDI), also referred to as Social Security, and Hospital Insurance(HI), also referred to as Medicare. FITW Federal Income Tax Withholding (FITW) Using employee marital status and personal allowances withholding the employer locates the correct FITW amount from the withholding tables in the current year's IRS Publication. Employer's Tax Guide.
What is FICA tax rate? Medicare or HI portion 1.45% Employee Medicare or HI portion 1.45% Employer combine rate of 2.9% Social Security portion 6.2% Employee Social Security portion 6.2% Employer combine rate of 12.4% Additional Medicare Tax? Employers withhold an additional Medicare tax of .9% from wages in excess of $200,000. There is no employer match on this tax. Federal Deposit Rules All federal tax deposits must be made under the IRS Electronic Federal Tax Payment System (EFTPS) program. How to Calculate FUTA FUTA tax is 6.0% of the first $7,000 of taxable wages paid to each employee.
When is FUTA Tax Paid? If accumulated FUTA liability is more the $500 for the quarter, a deposit must be made by the last day of the month following the end of the quarter. If the balance is less the $500 roll over to the next quarter and subsequent quarters until the end of the year. If les then $ 500 at the end of year the employer may pay its FUTA with Form 940 Form 941 Federal employment return used to report quarterly wage and tax information. When is Form 941 due? due on the last day of the month after the end of the quarter. Where to file Form 941? is filed with the IRS at the address indicated in the forms instructions. Electronic filing is also permitted. State unemployment returns are generally filed? quarterly
When employers are subject to both federal and state laws, they must observe the law that? is more favorable to the employee. Which year's Social Security tax rate and wage limit apply to employee bonus checks dated January 4, 2015, but received on December 30, 2014? 2014 What should be withheld from a bonus in the year it is paid? FIT and FICA Form 944? Employer who are notified by the IRS in writing to file Form 944 Is designed so the smallest employers (those whose annual liability for social security, Medicare, and withheld federal income taxes is $1,000 or less will file and pay these taxes only once a year instead of every quarter. 1099 - DIV
New employers or employers with an accumulated liability in the lookback period of $50,000 or less are required to deposit payroll taxes no later than the 15th of the month following the month in which they incurre the liability. Thy remain monthly depositors for the entire calendar year even if their accumulated liability for the calendar year exceeds $50,000. Lookback period Most employers are either monthly or semiweekly depositors-generally, the deposit status is fixed for an entire calendar year. An employer is a monthly or semiweekly depositor based on its deposit liabilities in the "lookback period." The Form 941 lookback period is the July 1-June 30 prior calendar year for which the deposit status is determined. Quarterly Depositors A liability for the quarter of less than $2,500 may be paid by credit/debit card, Electronic Funds Withdrawal (EFW), check or money order at the end of the quarter with Form 941. Employers with a deposit liability of $100,000 or more must make their deposit one business day from the day the liability is incurred.. How many days does an employer have to process data on a revised W-4? 30 days
The correct entry for the withholding of an employee's contribution to a pension plan is? Debit Salary Expense xxxx Credit Pension Plan Payable xxxx An employer is subject to FUTA requirements when its wages paid for the quarter exceed? An employer that pays wages of $1,500 or more in any calendar quarter or employs at least one person for some part of any day in 20 weeks must pay FUTA tax. Employees must receive a copy of their W-2 no later than? January 31 On which form do employers report employees' gross taxable income? W- 2 Computing Overtime Pay for Salaried, Nonexempt Employees multiply the gross pay by the number of annual pay periods, then divide b the total hours of scheduled work in the year. 52 weekly
Which of the following categories of employees are not exempt from the overtime pay requirements under federal law? Blue collar The entry to record employees' payroll expense? Debit Salary Expense $10, Credit FICA Employee Payable 765 Credit FITW Payable 2, Credit Cash 7, The entry to record employer's payroll tax expense? Debit Payroll Tax Expense 845 Credit Employer Payable 765 Credit FUTA Payable 80 To record payroll expense for the payroll period Debit Payroll Tax Expense 240. Credit FICA Employer Payable 156. Credit FUTA Payable 12. Credit SUI Payable 71.
How to accrual payroll expenses Debit Salary Expense 4, Credit Salary Payable 4,
