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Exam 4: Fringe Benefits and Voluntary Deductions

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Question 21

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What is the term for a tax-favorable IRA is set up by or for the employee,and the employer contributes the funds into the account?

A) IRA
B) SIMPLE
C) ESOP
D) SEP

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Question 22

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Which of the following are post-tax deductions? (You may select more than one answer. )

A) Employee contributions to gym memberships.
B) Employee contributions to charitable organizations.
C) Employee contributions to union dues.
D) Employee contributions to 401(k) plans.

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Question 23

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Premiums for insurance purchased through qualified cafeteria plans may be deducted from an employee's pay on a pre-tax basis.

All employee contributions to qualified Premium-Only Plans (POP)and Flexible Spending Arrangements (FSA)are deducted on a pre-tax basis.

Luis Billiot is an employee of Plato Designs and drives a 2017 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 28,350 miles for personal use.He pays for his own fuel.What is the amount of the company-car fringe benefit that will appear on Luis's W-2,using the lease-value rule? (Do not round intermediate calculations,only round final answer to two decimal points. )

As a general rule,when should the employer deposit money associated with employee benefits?

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

Publication ________ is the employer's guide to fringe benefits.

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

________ is the price that a person would pay for an item in an arm's length transaction.

Lakiesha is an employee who drives a 2017 Buick Verano as a company car.The fair-market value of the car is $28,545.She has been given the choice to have her fringe benefit reported on her W-2 either using the lease-value rule or the cents-per mile rule.According to Publication 15-b,the lease value is $7,750.She has driven 4,500 miles for personal use and 31,250 miles in total during the year.The car has been available for use on 200 days during the year.Lakiesha's employer pays for all fuel.What method and valuation will yield the lowest fringe-benefit amount for Lakiesha? (Do not round intermediate calculations,only round final answer to two decimal points. )

What options do employers have regarding taxable fringe benefits? (You may select more than one answer. )

What differentiates Flexible Spending Accounts (FSAs) and Health Savings Accounts (HSAs) ?

According to the Affordable Health Care Act,employers with ________ or more employees are required to file an informational return with the IRS and a detailed summary to the employees.

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

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

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

Fringe benefits are given to employees in return for their service to the company.

Which of the following is an example of a post-tax mandated deduction? (You may select more than one answer. )

________ benefits are fringe benefits with minimal value.