Practice Test Geeks(CPS) Certified Payroll Specialist Practice Test
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Payroll Fundamentals Flashcards

7 cards from real CPS practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

Read the first 7 Payroll Fundamentals flashcards as text

  1. An employee claims exempt from federal income tax withholding on Form W-4. By what date must she submit a new W-4 each year to maintain exempt status?

    Answer: February 15

    A W-4 claiming exempt status expires on February 15 of the following year; a new form must be submitted by that date to continue the exemption.

  2. Which payroll tax deposit schedule applies to a new employer with no tax liability history?

    Answer: Monthly depositor

    The IRS classifies new employers as monthly depositors until a lookback period establishes their tax liability history.

  3. Under FICA, the Additional Medicare Tax of 0.9% applies to wages exceeding what threshold for a single filer?

    Answer: $200,000

    Employers must withhold the Additional Medicare Tax of 0.9% on wages paid to an employee in excess of $200,000 in a calendar year, regardless of filing status.

  4. Which method allows employers to calculate federal income tax withholding using wage bracket tables for employees who have submitted a 2020 or later W-4?

    Answer: Wage bracket method

    The wage bracket method uses IRS Publication 15-T tables that match pay period wages to withholding amounts based on the employee's W-4 information.

  5. What is the FUTA tax rate after the maximum allowable state unemployment tax credit?

    Answer: 0.6%

    The gross FUTA rate is 6.0%, but employers in states with no outstanding federal loans receive a 5.4% credit, resulting in a net FUTA rate of 0.6%.

  6. A company pays a $500 spot bonus to an employee whose regular wages in the same paycheck are $2,000. Using the optional flat rate, how much federal income tax should be withheld from the bonus?

    Answer: $110.00

    The IRS supplemental wage flat rate is 22%; 22% × $500 = $110.00 federal income tax withheld from the bonus.

  7. Which document authorizes an employer to stop or reduce an employee's voluntary deduction such as health insurance?

    Answer: Signed employee authorization or revocation form

    Voluntary deductions require employee consent; a signed authorization or revocation form from the employee is needed to start, change, or stop them.