Question 1

Under the unsafe conditions rule:

Accepted Answer

A)  Employees are charged $1.50 for the one-way commute.
B)  An employee may use a company vehicle for a one-way commute.
C)  Employees may only use company cars if their normal travel mode is unsafe.
D)  Employees may leave work at any time.

Question 2

What is a limit on garnishments for nontax liens?

Accepted Answer

A)  It may not exceed 15% of an employee's disposable income.
B)  It may not exceed 30 times the federal minimum wage.
C)  An additional 5% may be added for any lien payments in arrears.
D)  It may be up to 50% of an employee's disposable income.

Question 3

According to Publication 15b, what is the annual cash value limit for excluded qualiﬁed achievement awards?

Accepted Answer

A)  $2,000
B)  $1,400
C)  $800
D)  $1,600

Question 4

Under the special accounting rule, beneﬁts provided in the last quarter of the year may be reported during the following year.

Accepted Answer

A) True 
 B)False

Question 5

If a fringe beneﬁt involves a deduction from employee pay, which of the following is true?

Accepted Answer

A)  Employers may only offer the beneﬁt to certain classes of employees.
B)  The amount of the deduction must be listed on the employee's pay advice.
C)  The fringe beneﬁt must be subject to income tax.
D)  The employee must enroll in direct deposit for their pay.

Question 6

Contributions to FSAs in excess of what annual amount are treated as taxable income?

Accepted Answer

A)  $1,930
B)  $2,370
C)  $1,660
D)  $2,700

Question 7

Under the lease-value rule, how is the taxable income for the employee determined? (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box for a wrong answer. Any boxes left with a question mark will be automatically graded as incorrect.)

Accepted Answer

A)  Multiply the lease amount by the percent of personal usage of the vehicle.
B)  Use the annual lease value amount for the vehicle from Publication 15b.
C)  Subtract the dollar amount of the fuel used.
D)  Multiply the lease amount by the percent of business usage of the vehicle.

Question 8

____ beneﬁts are fringe beneﬁts with minimal monetary value.

Accepted Answer

A)  Mandatory
B)  Minimal
C)  De normal
D)  De minimis

Question 9

Which of the following must accompany a Health Savings Account (HSA)  to be considered part of a cafeteria plan?

Accepted Answer

A)  Flexible Savings Agreement
B)  High-deductible health plan
C)  Long-term care insurance
D)  Low-deductible health plan

Question 10

The reporting of employee benefits occurs on the ____ and the ____ . (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box for a wrong answer. Any boxes left with a question mark will be automatically graded as incorrect.)

Accepted Answer

A)  Total compensation report
B)  Form W-2
C)  Payroll register
D)  Form W-4

Question 11

Retirement fund contributions are generally subject to ____ and ____ taxes.

Accepted Answer

A)  Federal withholding; Social Security
B)  Federal withholding; State withholding
C)  Federal withholding; Medicare
D)  Social Security; Medicare

Question 12

The ____ determines when beneﬁt amounts should be withheld from employee pay.

Accepted Answer

A)  State in which the business is conducted
B)  employee
C)  IRS
D)  employer

Question 13

Which of the following is an example of a post-tax mandated deduction? (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box for a wrong answer. Any boxes left with a question mark will be automatically graded as incorrect.)

Accepted Answer

A)  Credit card liens
B)  Tax liens
C)  Garnishments
D)  Charitable contributions

Question 14

Under what condition is the fringe beneﬁt of a gym membership taxable?

Accepted Answer

A)  When the employer has on-site facilities that are open to public use.
B)  When the employer has on-site facilities that are restricted to employee use.
C)  Gym memberships are always taxable.
D)  When the employer offers membership to an off-site club at no additional cost to the employee.

Question 15

Charitable contributions are an example of post-tax voluntary deductions.

Accepted Answer

A) True 
 B)False

Question 16

Post-Tax Deductions are amounts ____.

Accepted Answer

A)  are only mandatory deductions like garnishments and union dues
B)  that the employer chooses to withhold after assessing the employee's tax liability
C)  that are voluntarily chosen by the employee
D)  includes both mandatory and voluntary deductions

Question 17

Fringe beneﬁts are monetary or nonmonetary compensation given to employees in return for their service to the company.

Accepted Answer

A) True 
 B)False

Question 18

Which of the following may be included as part of an employee's Section 125 "cafeteria" plan?

Accepted Answer

A)  Medical expenses
B)  Tuition expenses
C)  Meal expenses
D)  Moving expenses

Question 19

Luis Billiot is an employee of Plato Designs and drives a 2019 Toyota Camry as a company car. The fair-market value of the car is $25,499 and the lease value
is $6,850, according to Publication 15-b. The car has been available for 300 days during the year and Luis has driven 5,500 of the 28,350 miles for personal
use. He pays for his own fuel. What is the percentage of miles driven for personal use, using the lease-value rule? (Do not round intermediate calculations, only
round final answer to two decimal points.)

Accepted Answer

A)  82.19%
B)  14.50%
C)  17.64%
D)  19.40%

Question 20

The most common way to determine the value of fringe beneﬁts is the general valuation rule.

Accepted Answer

A) True 
 B)False

Exam 4: Income Tax Withholding

Which of the following must accompany a Health Savings Account (HSA) to be considered part of a cafeteria plan?

Correct Answer
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Correct Answer
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Under the special accounting rule, beneﬁts provided in the last quarter of the year may be reported during the following year.

Correct Answer
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Under the unsafe conditions rule:

Correct Answer
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Under what condition is the fringe beneﬁt of a gym membership taxable?

Correct Answer
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Charitable contributions are an example of post-tax voluntary deductions.

Correct Answer
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Which of the following may be included as part of an employee's Section 125 "cafeteria" plan?

Correct Answer
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Fringe beneﬁts are monetary or nonmonetary compensation given to employees in return for their service to the company.

Correct Answer
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Retirement fund contributions are generally subject to and taxes.

Correct Answer
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Correct Answer
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Correct Answer
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Contributions to FSAs in excess of what annual amount are treated as taxable income?

Correct Answer
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According to Publication 15b, what is the annual cash value limit for excluded qualiﬁed achievement awards?

Correct Answer
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What is a limit on garnishments for nontax liens?

Correct Answer
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If a fringe beneﬁt involves a deduction from employee pay, which of the following is true?

Correct Answer
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The ____ determines when beneﬁt amounts should be withheld from employee pay.

Correct Answer
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Correct Answer
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The most common way to determine the value of fringe beneﬁts is the general valuation rule.

Correct Answer
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____ beneﬁts are fringe beneﬁts with minimal monetary value.

Correct Answer
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Post-Tax Deductions are amounts ____.

Correct Answer
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Exam 4: Income Tax Withholding

Which of the following must accompany a Health Savings Account (HSA) to be considered part of a cafeteria plan?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Under the special accounting rule, beneﬁts provided in the last quarter of the year may be reported during the following year.

Correct AnswerverifiedShow Answer

Under the unsafe conditions rule:

Correct AnswerverifiedShow Answer

Under what condition is the fringe beneﬁt of a gym membership taxable?

Correct AnswerverifiedShow Answer

Charitable contributions are an example of post-tax voluntary deductions.

Correct AnswerverifiedShow Answer

Which of the following may be included as part of an employee's Section 125 "cafeteria" plan?

Correct AnswerverifiedShow Answer

Fringe beneﬁts are monetary or nonmonetary compensation given to employees in return for their service to the company.

Correct AnswerverifiedShow Answer

Retirement fund contributions are generally subject to ____ and ____ taxes.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Contributions to FSAs in excess of what annual amount are treated as taxable income?

Correct AnswerverifiedShow Answer

According to Publication 15b, what is the annual cash value limit for excluded qualiﬁed achievement awards?

Correct AnswerverifiedShow Answer

What is a limit on garnishments for nontax liens?

Correct AnswerverifiedShow Answer

If a fringe beneﬁt involves a deduction from employee pay, which of the following is true?

Correct AnswerverifiedShow Answer

The ____ determines when beneﬁt amounts should be withheld from employee pay.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

The most common way to determine the value of fringe beneﬁts is the general valuation rule.

Correct AnswerverifiedShow Answer

____ beneﬁts are fringe beneﬁts with minimal monetary value.

Correct AnswerverifiedShow Answer

Post-Tax Deductions are amounts ____.

Correct AnswerverifiedShow Answer

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Retirement fund contributions are generally subject to and taxes.

Correct Answer
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