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Exam 10: Payroll Taxes

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Question 41

Multiple Choice

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Brenda is a self-employed accountant. She has net earnings (profit) from her practice of $74,000. Her self-employment taxes for the year are:

A) $10,250.85.
B) $10,450.21.
C) $10,455.87.
D) $11,322.00.

E) A) and B)
F) A) and C)

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Question 42

Multiple Choice

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If on any day during the month, an employer accumulates $100,000 or more in tax liability, the taxes must be deposited:

A) By the next banking day.
B) Before the close of the business day in which the liability occurs.
C) By the last day of the week if the employer is a monthly depositor.
D) By either the following Wednesday or Friday if the employer is a semiweekly schedule depositor.

E) A) and B)
F) C) and D)

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Question 43

Multiple Choice

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Supplemental wages are subject to the following taxes:

When calculating self-employment taxes from a taxpayer who also receives wages from a salaried job, the earnings from self-employment are considered first in calculating the ceiling amount for social security and Medicare.

Griffith & Associates is trying to determine how often it needs to deposit payroll taxes for the calendar year 2015. The company made the following quarterly payroll tax deposits during the last two years: a. What is the lookback period and amount? b. In 2015, how often must Griffith & Associates make payroll deposits?

Taxpayers who employ household workers must file a quarterly 941 return and an annual 940 return.

Angie earned $120,000 during 2015. She is single, claims two withholding allowances, and is paid monthly. How much will Angie's employer withhold in social security taxes for 2015?

Teko earned $109,500 during 2015. Teko is paid on a monthly basis, is married, and claims three allowances. a. What is Teko's federal tax withholding for the month? b. What is Teko's FICA withholding for the month? c. How much will Teko's employer remit in payroll tax deposits for the month? d. How much FUTA tax is Teko's employer required to remit in her name for the year 2014? Assume that all state contributions have been paid as required.

Only wages paid in cash are subject to federal withholding.

Juan is married, is paid 2,000 per week, and claims three withholding allowances. What is the amount of federal income tax withheld from Juan's gross wages for the week using the percentage method?

The amount withheld from supplemental payments depends on whether the employer accounts for the payment separate from regular wages.

What form is given to an employee to correct incorrect payroll information?

Employers with a payroll tax liability of less than $2,500 at the end of a quarter can pay the payroll tax liability at the end of the next month following the quarter with Form 941.

Failure to furnish a correct TIN to a requester (payer) can result in a penalty for the payee of:

Claude works as a teacher during the year at the local high school. He also prepares taxes on a part-time basis. During 2015, Claude earned $84,800 from his job as a teacher. He also earned $12,000 preparing taxes from January to April 2015. He operates his tax preparation business as a sole proprietorship. Claude estimates that he will owe $2,036 more in income taxes for 2014. Explain what Claude should do so that he does not incur any underpayment penalties.

Wages subject to withholding and other employment taxes include all pay given to employees for services performed.

Kim works part-time for Medical Assistants Inc., and earned $6,385 for 2015. What amount of FUTA tax must her employer remit to the IRS? Assume her employer receives the maximum credit for state unemployment taxes.

In the lookback period, if the employer reported total payroll taxes of more than $50,000, the employer is a semiweekly schedule depositor.

A taxpayer with an AGI of $157,350 for 2015 pays estimated taxes. The taxpayer can avoid an underpayment penalty by paying:

A taxpayer had AGI of $300,000 in 2015 and AGI of $250,000 in 2014. When filing her 2015 return, she expects her unpaid tax liability to be at least $1,000. She must make estimated payments equal to the smaller of 90% of the tax shown on her 2015 return or