Tax Preparation Tax Forms and Procedures 2

Question 1

An employer must deposit federal payroll taxes by what general deadline for monthly depositors?

Accepted Answer

The 15th of the following month

Answer

Monthly depositors must deposit payroll taxes by the 15th day of the month following the payroll month.

Question 2

Form 941 is filed by employers to report:

Accepted Answer

Quarterly payroll taxes including income tax withheld and FICA

Answer

Form 941, Employer's Quarterly Federal Tax Return, reports wages paid, federal income tax withheld, and employer/employee FICA taxes each quarter.

Question 3

What is the penalty for failing to file Form 1040 on time (without an extension)?

Accepted Answer

5% per month on unpaid tax (up to 25%)

Answer

The failure-to-file penalty is 5% of unpaid tax per month (up to 25%), significantly larger than the failure-to-pay penalty of 0.5% per month.

Question 4

Which form is used by nonresident aliens to file a US income tax return?

Accepted Answer

Form 1040-NR

Answer

Form 1040-NR is the US Nonresident Alien Income Tax Return for foreign nationals with US-source income.

Question 5

A taxpayer receives a CP2000 notice from the IRS. What does this indicate?

Accepted Answer

There is a discrepancy between reported income and third-party information

Answer

A CP2000 is an IRS automated underreporter notice proposing changes when income or deductions on the return don't match third-party documents.

Tax Preparation Practice Test