CPP Benefits Administration 5

Question 1

Which of the following fringe benefits is fully excludable from an employee's gross income under IRC Section 132?

Accepted Answer

No-additional-cost services provided by the employer

Answer

No-additional-cost services (e.g., a free flight on the employer's airline when seats are available) are excluded from income under IRC Section 132(b).

Question 2

A qualified transportation fringe benefit allowing employees to exclude commuter highway vehicle and transit pass benefits has a monthly limit in 2024 of:

Accepted Answer

$315 per month

Answer

For 2024, the monthly exclusion limit for employer-provided qualified transit passes and commuter highway vehicle benefits is $315.

Question 3

Under ERISA's fiduciary duty requirements, which of the following actions would be a breach of fiduciary duty by a plan administrator?

Accepted Answer

Investing plan assets in the employer's own stock beyond ERISA limits

Answer

ERISA imposes strict limits on investing plan assets in employer securities; exceeding those limits is a prohibited transaction and breach of fiduciary duty.

Question 4

When an employee takes FMLA leave, how must the employer treat the employee's health benefits during the leave?

Accepted Answer

The employer must maintain group health benefits on the same terms as if the employee had continued working

Answer

Under FMLA, employers must maintain group health insurance coverage during leave under the same terms and conditions as if the employee had not taken leave.

Question 5

What is the COBRA premium that a qualified beneficiary can be charged, including the administrative fee?

Accepted Answer

102% of the applicable premium

Answer

Qualified beneficiaries may be charged up to 102% of the applicable premium (100% cost of coverage + 2% administrative fee).

CPP - Certified Payroll Professional Practice Test

CPP - Certified Payroll Professional Practice Test

CPP Benefits Administration 5