payroll hell quiz1

This is a quiz about chapter one. There are multiple choice, true and false, and calculation questions. If you find any incorrect answers please email me as soon as possible. Thank you and good luck on the test.

Each quiz is for a different chapter, so don't trick yourself into thinking this is the only quiz. If you like, you can double check or write down the time to see how long it takes you to finish each chapter. Thank you and good luck on the test.

Created by: Rumi
What is your age?
Under 18 Years Old
18 to 24 Years Old
25 to 30 Years Old
31 to 40 Years Old
41 to 50 Years Old
51 to 60 Years Old
Over 60 Years Old
What is your gender?
1. If the employer has the right to control what work will be done & how that work will be done, an employer-employee relationship exists.
2. Full-time life insurance salespersons are always considered statutory employees & are never subject to FUTA tax.
3. Workers hired through a temporary help agency are not employees of the client company.
4. Telemarketers working under the direction of a company are usually independent contractors.
5. An accountant who provides bookkeeping & payroll services to several local businesses & works at her own office is an independent contractor.
6. The responsibility for determining the employment status of an individual who performs services rests with the employer.
7. If an independent contractor timely provides the employer with a correct Taxpayer Identification Number, there will be no backup withholding
8. The IRS usually relies on the reasonable basis test in making employment status determinations.
9. Managers & executive are excluded from the employer-employee relationship for tax purposes.
10. Length of employment makes no difference in determining employment status.
11. Technical services specialists are specifically excluded from the "reasonable basis" test.
12. Under the ABC test, one of the determining factors is whether the worker in question is free from control or direction in performing the work both by agreement and in reality.
13. Part-time employees are not covered under the federal payroll tax laws even if they meet the common law test for employment status.
14. "Reciprocity agreements" require employers to withhold state income tax only for their emplyees' state of residence.
15. Employers can demand specific documents to prove an employee's eligibility to work in the U.S.
16. Employers who claim Section 530 status for their workers because a significant segment of their industry classifies similar workers the same way must show that at least 50% of the industry treats these workers as independent contractors.
17. An employer that changes its classification of a worker from independent contractor to employee may still claim Section 530 protection for the period before the change in treatment.
18. An IRS agent conducting an employment tax audit must give the employer written notice of the availability of the Section 530 protections.
19. Under the federal new hire reporting requirements, multistate employers must report a new hire to the state in which the employee works.
20. Which of the following forms may be completed & submitted to the IRS to determine the employment status of an individual for federal income & employment tax purposes?
Form SS-4
Form SS-5
Form SS-8
Form W-9
21. Which of the following forms must be submitted to an independent contractor (who is paid at least $600) after the end of the year for services performed during that year.
Form W-2
Form 1099-MISC
Form 1096
Form SS-8
22. All of the following types of evidence support an employer's treatment of a worker as an independent contactor under the "reasonable basis" test except:
Place of work
Court decisions
Private letter rullings
Past IRS employment tax audits
23. All of the following criteria would be typical of independent contractor except:
Works off site
Paid by the hour
Furnishes own tools
Sets own work hours
24. Each of the following individuals would be classified as an employee except:
Controller of a company
College professor
Attorney (solo practitioner)
City police officer
25. All of the following workers are statutory employees except:
Full-time life insurance salespersons
Qualified real estate agents
Traveling or city salespersons
26. Full-time life insurance salespersons paid solely by commissions are exempt from:
Social security & Medicare taxes
Social security tax only
FUTA tax
Social security, Medicare & FUTA taxes
27. If an employer fails to withhold social security & Medicare taxes & does not file a Form W-2 or a Form 1099 for an individual, what penalty may the IRS impose?
10% of the employee's share of social security & Medicare taxes
20% of the employee's share of social security & Medicare taxes
40% of the employee's share of social security & Medicare taxes
100% of the employee's share of social security & Medicare taxes
28. How long must an employer retain a Form I-9 for a terminated employee who worked for the employer for more than 4 years?
1 year after termination
3 years after termination
7 years after termination
Does not have to keep terminated employees' I-9 forms
29. Which of the following situations describes one of the general requirements that must be met for workers to be considered statutory employees?
They have a continuing relationship with the employer
They have a substantial investment in the business equipment
they are licensed real estate agents
most of their compensation is related to sales
30. Each of the following goals is a reason why states might require employers to report employers to report newly hired employees except:
to detect welfare fraud
to detect unemployment compensation fraud
to locate individuals who have not claimed state lottery winnings
to locate noncustodial parents subject to a child support withholding order
31. Which of the following individuals are statutory nonemployees?
full-time life insurace salespersons
newspaper deliverers
traveling salespersons

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