Fundamental Payroll Certification Fundamental Payroll Employment Taxes and Withholding 2

Question 1

An employee claims 'Exempt' on their W-4. What does this mean for federal income tax withholding?

Accepted Answer

No federal income tax is withheld from their wages

Answer

An exempt claim on a W-4 means the employer should not withhold any federal income tax from the employee's wages.

Question 2

Which IRS form is used by employers to report federal income tax withheld and FICA taxes on a quarterly basis?

Accepted Answer

Form 941

Answer

Form 941, the Employer's Quarterly Federal Tax Return, is used to report federal income tax withheld and FICA taxes each quarter.

Question 3

The Additional Medicare Tax of 0.9% applies to wages exceeding what threshold for a single filer?

Accepted Answer

$200,000

Answer

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

Question 4

Which deposit schedule applies to a new employer with no lookback period history?

Accepted Answer

Monthly depositor

Answer

New employers with no lookback period history are automatically classified as monthly depositors.

Question 5

An employee's wages are $1,500 for the pay period. Using the percentage method, which IRS table does the employer consult to determine withholding under the 2020+ W-4?

Accepted Answer

Publication 15-T Percentage Method Tables for Automated Payroll Systems

Answer

Publication 15-T contains the Percentage Method Tables for Automated Payroll Systems used to calculate federal income tax withholding.

Fundamental Payroll Certification Practice Test

Fundamental Payroll Certification Practice Test

Fundamental Payroll Certification Fundamental Payroll Employment Taxes and Withholding 2