FPC-Remote Free Practice Test

- (Topic 2)
A semiweekly depositor accumulates a payroll tax liability of $49,000.00 on Thursday. The next day, the company has bonus payroll with a tax liability of $120,200.00. Calculate the amount of tax deposit and its due date.

1. A. $120,200.00 on the following Friday; $49,000.00 on the following Wednesday
2. B. $120,200.00 on the following Monday; $49,000.00 on the following Wednesday
3. C. $169,200.00 on the following Monday
4. D. $169,200.00 on the following Wednesday

Correct Answer: C
✑ As a semiweekly depositor, if the tax liability exceeds $100,000 in a single day, the employer must deposit the full amount by the next business day.
✑ The combined liability of $169,200 must be deposited on Monday.
References:
✑ IRS Publication 15 (Federal Deposit Rules)

- (Topic 2)
Using the following information, calculate theFUTA tax liability:

1. A. $6.24
2. B. $6.60
3. C. $6.68
4. D. $6.77

Correct Answer: B
✑ Step 1: Determine taxable wagesFUTA tax applies to the first$7,000of an employee's wages annually.
✑ Step 2: Calculate FUTA tax
References:
✑ IRS Publication 15 (Employer??s Tax Guide)
✑ FUTA Tax Calculation Guide (Payroll.org)

- (Topic 2)
Employer's federal quarterly employment taxes are reported on:

1. A. Form 940
2. B. Form 941
3. C. Form 944
4. D. Form 945

Correct Answer: B
✑ Form 941 is used to report quarterly employment taxes(including federal income tax, Social Security, and Medicare).
✑ Form 940 reports FUTA taxes (A), not quarterly employment taxes.
✑ Form 944 is for small employerswho file annually instead of quarterly.
✑ Form 945 is for non-wage income withholding (D). References:
✑ IRS Form 941 Instructions

- (Topic 1)
Which of the following forms is used to report federal income tax withheld from payments to an independent contractor?

1. A. Form 940
2. B. Form 941
3. C. Form 944
4. D. Form 945

Correct Answer: D
Comprehensive and Detailed Explanation:Form 945is used byemployers to report federal income tax withholding from non-payroll payments, including payments toindependent contractorsif subject tobackup withholding.
✑ Option A (Form 940)is incorrect becauseForm 940 reports federal unemployment
taxes (FUTA).
✑ Option B (Form 941)is incorrect because it is used foremployee payroll tax reporting.
✑ Option C (Form 944)is incorrect because it is used forsmall employers filing annually.
Reference:
IRS Form 945 Instructions
Payroll.org – Independent Contractor Withholding Rules

- (Topic 2)
All of the following employees are examples of phantom employees EXCEPT:

1. A. A non-existent employee set up using false information.
2. B. A remote employee that is not required to record their time.
3. C. A terminated, salaried employee whose status was purposely not changed.
4. D. A deceased employee that continues to receive pay due to lost paperwork.

Correct Answer: B
Phantom employees are fraudulent payroll entries wheresalaries are paid to non-existent or inactive employees.
✑ Option A, C, and Dare examples of phantom employees.
✑ Option B (Remote employees not required to record time) is NOT a phantom employee, as long as they are legitimate workers.
References:
✑ Payroll Fraud Prevention, IRS
✑ Payroll Audit Techniques Guide (IRS Publication)