CPP Certified Payroll Professional 3 — Questions and Answers
Question 1: Under the FLSA, what is the maximum number of hours an employee can work in a workweek before overtime pay is required?
- 32 hours
- 40 hours (Correct answer)
- 44 hours
- 80 hours in a biweekly period
Correct answer: 40 hours
The FLSA requires overtime pay at 1.5× the regular rate for all hours worked beyond 40 in a single workweek.
Question 2: Which of the following correctly describes the employer's share of FICA taxes?
- 6.2% Social Security + 1.45% Medicare, matching the employee share (Correct answer)
- 3.1% Social Security + 0.9% Medicare
- 6.2% Social Security + 2.35% Medicare for all wages
- 7.65% total only on wages above the Social Security wage base
Correct answer: 6.2% Social Security + 1.45% Medicare, matching the employee share
Employers match employee FICA contributions: 6.2% Social Security (up to the wage base) and 1.45% Medicare on all wages.
Question 3: A garnishment order requires withholding 25% of an employee's disposable earnings. Under federal law, what is the maximum that can be withheld if this would exceed the CCPA limit?
- 30 times the federal minimum hourly wage
- The lesser of 25% of disposable earnings or the amount exceeding 30 × federal minimum wage (Correct answer)
- 50% of disposable earnings
- There is no federal cap on garnishments
Correct answer: The lesser of 25% of disposable earnings or the amount exceeding 30 × federal minimum wage
The CCPA limits garnishment to the lesser of 25% of disposable earnings or the amount by which weekly disposable earnings exceed 30 times the federal minimum wage.
Question 4: Form 944 is designed for employers whose annual federal tax liability is:
- Less than $1,000
- $1,000 or less (Correct answer)
- $2,500 or less
- More than $50,000
Correct answer: $1,000 or less
Form 944 (Employer's Annual Federal Tax Return) is for small employers with $1,000 or less in annual federal tax liability, replacing quarterly Form 941 filing.
Question 5: What does 'disposable earnings' mean in the context of wage garnishment?
- Total gross wages before any deductions
- Wages remaining after deductions required by law (Correct answer)
- Net pay after all voluntary deductions
- The employee's take-home pay after taxes and benefits
Correct answer: Wages remaining after deductions required by law
Disposable earnings are the amount remaining after legally required deductions such as taxes, Social Security, and state unemployment insurance — not voluntary deductions.
Question 6: Which tax deposit schedule applies to a new employer with no prior tax history?
- Annual depositor
- Monthly depositor (Correct answer)
- Semiweekly depositor
- Next-day depositor
Correct answer: Monthly depositor
New employers with no prior tax history default to monthly deposit status in their first year.
Question 7: An employee's regular rate of pay must include which of the following when calculating overtime?
- Discretionary bonuses
- Non-discretionary production bonuses (Correct answer)
- Gifts for special occasions
- Employer contributions to health plans
Correct answer: Non-discretionary production bonuses
Non-discretionary bonuses (e.g., production or attendance bonuses) must be included in the regular rate of pay used to compute overtime.
CPP Certified Payroll Professional 3
Under the FLSA, what is the maximum number of hours an employee can work in a workweek before overtime pay is required?