20. Which of the following would be a non-taxable benefit to an employee?a. A discount on a product that brings the selling price below the cost of goods sold.b. A $100 gift card received for being employee of the month.c. A free membership to the gym on the employer's site.d. A cash allowance for lunches at local restaurants.

The objective of the question is to identify which of the given options would be considered a…

Answered: 20. Which of the following would be a…

Income Tax Fundamentals 2020

38th Edition

ISBN:9780357391129

Author:WHITTENBURG

Publisher:WHITTENBURG

Chapter2: Gross Income And Exclusions

Section: Chapter Questions

Problem 9MCQ

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Discuss the Fringe Benefits Tax (FBT)implications of the followingcases (a) –(e): (a)An employer providesa Christmas lunch at a local restaurant, costing $1,000, for 10 of its key employees.
1. Under individual employee coverage, the worker is covered by the FLSA if: a.the worker is a housekeeper in a private home for 16 hours a week. b.the domestic receives cash wages of at least $2,300 from the employer in the calendar year. c.the worker produces goods for interstate commerce. d.All of these choices are correct. e.None of these choices are correct. 2. The FICA tax rates for the self-employed are: a.6.2% (OASDI) and 2.9% (HI). b.6.2% (OASDI) and 1.45% (HI). c.12.4% (OASDI) and 1.45% (HI). d.10.0% (OASDI) and 1.0% (HI). e.None of these choices are correct. 3. The garnishment that takes priority over all others, except bankruptcy orders is : a.a government student loan b.an administrative wage garnishment c.a child support order d.a state tax levy e.a creditor garnishment 4. The FLSA requires that: a.employers use the continental time system to record all time worked by employees. b.employees sign each clock card. c.employers keep records that show…
Darrell is an employee of Whitneys. During the current year, Darrells salary is 136,000. Whitneys net self-employment income is also 136,000. Calculate the Social Security and self-employment taxes paid by Darrell and Whitney. Write a letter to Whitney in which you state how much she will have to pay in Social Security and self-employment taxes and why she owes those amounts.
5. The following are included in an employee benefits EXCEPT one. Vacation leave Sick leave Transportation allowance Shopping spree
Which of the following fringe benefits provided by an employer would result in taxable income to an employee? Group of answer choices A cell phone used by a salesperson to talk to clients while traveling. Reimbursements paid by the employer for qualified business travel expenses Occasional personal use of an office copy machine Use of a company car for daily commuting
Which of the following is a fringe benefit excluded from income? a.Quickchat Inc. gives each employee a $10 gift card to the local coffee shop on National Coffee Day. b.A mechanic at Denise's employer, a car rental company, provides $1,000 of repair services to Denise's personal car for free. c.Hedaya, a doctoral student at Ivy University, receives a full tuition waiver while serving as research assistant. d.Alfa-Bet, a high-tech corporation, pays for each employee's membership at the 24 Hour Biceps Gym closest to each Alfa-Bet office.
6., RST Company offers a qualified retirement plan. Each employee contributes 4 percent of his or her pretax income to the plan, and RST matches each employee's contribution. An employee's benefit at retirement is determined by his or her account balance at the time of retirement. What type of retirement plan does RST offer? a. Defined contribution plan. b. Defined benefit, flat percentage of annual earnings c. Defined benefit, unit-credit formula. d. Defined benefit, flat dollar amount for all employees
When an employee elects salary reduction for a flexible spending account (FSA) which of the following statements is/are correct? Group of answer choices Under an FSA, dependent care benefits can be provided to a maximum of up to five children. The salary reduction is subject to payroll taxes, but not the employees' income taxes. The money in an FSA account can be used for deductibles, co-payments, and medical expenses, that are covered by the employer's medical plan. If the employee does not use all of the health care salary reduction, the balance may be rolled over to the following year.
The biweekly taxable wages for the employees of Rite-Shop follow. Compute the FICA taxes for each employee and the employer's FICA taxes. Round your answers to the nearest cent. FICA Taxes Employee OASDI HI Employee Name Biweekly Taxable Wages No. 711 Castro, Manny $4,000.00 $4 512 Corrales, Pat 984.00 624 Guitar, Joseph 1,018.00 325 Moore, Connie 1,203.40 422 Morrison, Harry 2,300.00 Robertson, 210 1,274.80 Catherine 111 Swarez, Joseph 1,322.00 Totals Employer's OASDI Total Taxable Wages Employer's OASDI Tax Employer's HI Tax Total Taxable Wages Employer's HI Tax
1. Who assigns the SUTA tax rate to an employer? Answer: A. The Internal Revenue Service B. The state in which the employer is located C. The Social Security Administration D. The American Payroll Association 2. What is the due date for the first quarter FUTA tax? Answer: A. April 30 B. March 30 C. April 15 D. None of these options 3. Match each tax with its associated feature. SUTA Self-employment Social Security and Medicare The employer presently matches the amount employees pay. If net SE income is below $400, no tax is due. The number of laid-off employees may affect it.
Use the 2021 FICA tax rates, shown, to answer the following question. If a taxpayer is not self-employed and earns $128,000, what are the taxpayer's FICA taxes? Employee's Rates Matching Rates Paid by the Employer Self-Employed Rates 7.65% on first $142,800 of 7.65% on first $142,800 paid 15.3% on first $142,800 of net income profits in wages 1.45% of income in excess of $142,800 1.45% of wages paid in excess of $142,800 2.9% of net profits in excess of $142,800 The taxpayer's FICA taxes are $ (Round to the nearest cent as needed.)
Select the best answer. What is the maximum amount of tax credits available to employers for paid leave provided to employees under the FFCRA? 100% of the qualifying payments made to employees who took leave for a qualifying reason, A. thus giving the employer full reimbursement B. 100% of the payments made for the first two weeks of paid leave and 2/3ds of the payments made for the additional ten weeks C. 100% of the payments made to full-time employees only 100% of the payments made to employees who were employed for at least 30 days prior to D. the leave Submit Answers

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