Question 1

An aspect of the interstate reciprocal arrangement concerns:

Accepted Answer

The interstate reciprocal arrangement pertains to the transfer of an employee from one state to another during the year, allowing the employee to have continuity of employment and consistent benefits.

Question 2

Voluntary contributions to a state's unemployment department are:

Accepted Answer

Voluntary contributions to a state's unemployment department are designed to increase an employer's reserve account in order to lower the employer's contribution rate. This allows the employer to pay lower unemployment insurance taxes in the future.

Question 3

Which of the following is not a factor considered in determining coverage of interstate employees?

Accepted Answer

While the location of a company's payroll department may be relevant in determining payroll taxes and other employment issues, it is not a factor considered in determining coverage of interstate employees. The other factors listed (location of base of operations, place where work is localized, location of employee's residence, and location of place from which operations are controlled) are typically taken into account when determining if an employee is covered under state or federal labor laws.

Question 4

A federal unemployment tax is levied on:

Accepted Answer

A federal unemployment tax is levied on employers only. It is used to fund unemployment benefits for eligible workers who are unemployed through no fault of their own.

Question 5

If the employer is tardy in paying the state contributions, the credit against the federal tax is limited to what percent of the late payments that would have been allowed as a credit if the contributions had been paid on time?

Accepted Answer

The credit against the federal tax for late payments of state contributions is limited to 90% of what would have been allowed if the contributions had been paid on time.

Question 6

Which of the following types of payments are not taxable wages for federal unemployment tax?

Accepted Answer

Retirement pay is not considered taxable wages for federal unemployment tax purposes because it is paid after the employment relationship has ended and is not compensation for services rendered.

Question 7

Which of the following payments are taxable payments for federal unemployment tax?

Accepted Answer

The answer of Which of the following payments are taxable...

Question 8

Included under the definition of employees for FUTA purposes are:

Accepted Answer

Officers of a corporation are considered employees for the Federal Unemployment Tax Act (FUTA) purposes, as they perform services for the corporation in exchange for remuneration.

Question 9

When making a payment of FUTA taxes, the employer must make the payment by the:

Accepted Answer

The answer of When making a payment of FUTA taxes,...

Question 10

An employer must pay the quarterly FUTA tax liability if the liability is more than:

Accepted Answer

The correct answer is B) $500. Employers must pay the quarterly Federal Unemployment Tax Act (FUTA) tax liability if it exceeds $500. If the liability is $500 or less, it can be carried forward to the next quarter.

Question 11

If the employer has made timely deposits that pay the FUTA tax liability in full, the filing of Form 940 can be delayed until:

Accepted Answer

If the employer has made all FUTA tax deposits when due, the deadline for filing Form 940 is extended to February 10. This allows employers extra time beyond the standard January 31 deadline to file the form.

Question 12

In order to avoid a credit reduction for Title XII advances, a state must repay the loans by:

Accepted Answer

To avoid a credit reduction for Title XII advances, a state must repay the loans by November 10 of the year the credit reduction is scheduled to take effect. This allows the state to avoid the reduction in credit against the federal unemployment tax that employers in the state would otherwise face.

Question 13

Which of the following provides for a reduction in the employer's state unemployment tax rate based on the employer's experience with the risk of unemployment?

Accepted Answer

An experience-rating plan provides for a reduction in the employer's state unemployment tax rate based on the employer's experience with the risk of unemployment. This means that if the employer has fewer unemployment claims, they will receive a lower tax rate.

Question 14

For FUTA purposes, an employer can be any one of the following except:

Accepted Answer

All of the above can be employers as per FUTA regulations.

Question 15

The person who is not an authorized signer of Form 940 is:

Accepted Answer

Only individuals who are authorized to sign forms on behalf of the company should sign Form 940. The accountant from the company's independent auditing firm may not be an authorized signer unless they have been granted that authority by the company.

Quiz 5: Unemployment Compensation Taxes