Payroll Setup and Management Flashcards
7 cards from real QBO 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 Setup and Management flashcards as text
A payroll check was issued with the wrong pay rate. The error is discovered after the check was cashed. What is the recommended QBO Payroll correction approach?
Answer: Void the check, issue a corrected check, and file a W-2c if the year has closed
For a cashed check with a pay rate error, you void the original, issue a corrected check, and if the error affects year-end W-2 data, file a W-2c.
What is the purpose of the 'Payroll Preferences' section under Account and Settings in QBO?
Answer: To set defaults like pay schedule, pay stub delivery method, and accounting preferences for payroll
Payroll Preferences lets you configure company-wide defaults such as pay stub delivery, default pay schedule, and payroll accounting mapping.
Under the FUTA tax rules, employers receive a credit of up to 5.4% for timely state unemployment tax payments, reducing the effective FUTA rate to what percentage?
Answer: 0.6%
The gross FUTA rate is 6.0%, and with the full 5.4% state credit, the net federal FUTA rate is 0.6% on the first $7,000 of wages.
In QBO Payroll, what triggers the Additional Medicare Tax (0.9%) withholding for an employee?
Answer: Medicare wages exceed $200,000 for the calendar year from that employer
Employers must withhold an additional 0.9% Medicare tax once an individual employee's wages from that employer exceed $200,000 in a calendar year.
Which QBO Payroll feature allows a ProAdvisor to set up and send W-2 forms electronically to employees at year-end?
Answer: Employee Self-Service portal via Workforce
QuickBooks Workforce (the employee self-service portal) allows employees to view and download their W-2 forms electronically when enabled.
A client asks about the lookback period used to determine their federal payroll tax deposit schedule (monthly vs. semi-weekly). What period does the IRS examine?
Answer: July 1 through June 30 of the prior year (the lookback period)
The IRS uses the lookback period of July 1 through June 30 of the prior year to determine whether an employer deposits on a monthly or semi-weekly schedule.
In QBO Payroll, how are fringe benefits like personal use of a company vehicle typically handled for tax purposes?
Answer: They are added as taxable compensation on the employee's paycheck using an addition pay type
Non-cash taxable fringe benefits must be added to the employee's wages via a taxable addition pay type so payroll taxes are calculated correctly.