MCQ Flashcards

Under ERISA, a 401(k) plan must distribute elective deferrals made under a safe harbor plan to participants no later than:

Answer: By March 15 of the following year

Excess contributions must be distributed by March 15 of the year following the plan year to avoid excise taxes under IRC Section 4979.

Which form must an employer use to correct errors on previously filed Form 941?

Answer: Form 941-X

Form 941-X is the Adjusted Employer's Quarterly Federal Tax Return or Claim for Refund used to correct errors on a previously filed Form 941.

Under the ACA employer mandate, applicable large employers (ALEs) that fail to offer minimum essential coverage to at least 95% of full-time employees may be subject to a Shared Responsibility Payment under:

Answer: IRC Section 4980H(a)

IRC Section 4980H(a) imposes the 'A' penalty on ALEs that fail to offer minimum essential coverage to at least 95% of their full-time employees and their dependents.

An employee is paid $1,800 semimonthly. What is this employee's annualized salary?

Answer: $43,200

Semimonthly means 24 pay periods per year; $1,800 × 24 = $43,200 annualized salary.

Which of the following payments is exempt from FUTA tax?

Answer: Wages paid to a spouse employed by the other spouse

Wages paid by one spouse to another in a non-corporate business setting are exempt from FUTA tax under IRC Section 3306(c)(5).

The Social Security Administration requires employers to report employee wages on Form W-2 by:

Answer: January 31

Employers must furnish Form W-2 to employees and file copies with the SSA by January 31 of the year following the tax year.

When processing a new hire's Form I-9, the employer must complete Section 2 within how many business days of the employee's first day of employment?

Answer: 3 business days

Employers must complete Section 2 of Form I-9 within 3 business days of the employee's first day of employment.