Fundamental Payroll Certification Fundamental Payroll Payroll Reporting and Compliance 4

Question 1

An employer incorrectly classified a worker as an independent contractor. Under Section 530 relief, what must the employer demonstrate?

Accepted Answer

A reasonable basis, substantive consistency, and reporting consistency

Answer

Section 530 relief requires the employer to show a reasonable basis for the classification, substantive consistency in treating similar workers, and reporting consistency in filing information returns.

Question 2

Which form is used to report wages paid to a deceased employee's estate in the year following the employee's death?

Accepted Answer

Form 1099-MISC only

Answer

Wages paid to a deceased employee's estate in the year after death are reported on Form 1099-MISC (not W-2) because they are not subject to income tax withholding.

Question 3

What is the filing deadline for submitting Copy A of Form W-2 to the Social Security Administration when filing electronically?

Accepted Answer

January 31

Answer

The deadline for submitting W-2 Copy A to the SSA is January 31, regardless of whether you file on paper or electronically.

Question 4

Which of the following correctly describes the 'catch-up' FICA deposit rule for large employers?

Accepted Answer

If total undeposited liability is under $100, it may be carried over to the next period

Answer

The de minimis rule allows employers to carry over undeposited tax of less than $100 to the next period rather than making a deposit.

Question 5

Which statement about backup withholding is correct?

Accepted Answer

It applies to payees who have not provided a correct TIN on Form W-9, at a rate of 24%

Answer

Backup withholding at 24% is required when a payee fails to provide a correct taxpayer identification number (TIN) on Form W-9.

Fundamental Payroll Certification Practice Test

Fundamental Payroll Certification Practice Test

Fundamental Payroll Certification Fundamental Payroll Payroll Reporting and Compliance 4