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Exam 5: Unemployment Compensation Taxes

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Question 21

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In the case of a part-time employee,the employer is not liable to pay any of the employee's earnings.

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Question 22

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For FUTA purposes,an employer must pay a higher FUTA tax rate on executives than on nonsupervisory personnel.

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Instruction 5-1 Use the net FUTA tax rate of 0.6% on the first $7,000 of taxable wages. ​ -Refer to Instruction 5-1.Faruga Company had FUTA taxable payrolls for the four quarters of 2017 of $28,400;$19,600;$16,500;and $8,900,respectively.The company was located in a state that was subject to a FUTA credit reduction of 1.5%.What was the amount of Faruga's first required deposit of FUTA taxes?

Partnerships do not have to pay unemployment taxes on the wages of their employees.

Currently,none of the states imposes an unemployment tax on employees.

In most states,the contribution reports and the wage information reports are filed quarterly.

In order to obtain the maximum credit allowed against the federal unemployment tax,the employer must have paid its SUTA contributions by the due date of Form 940.

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

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

On Form 940,even if the total FUTA tax is more than $500,there is no listing of quarterly federal unemployment tax liabilities.

Instruction 5-1 Use the net FUTA tax rate of 0.6% on the first $7,000 of taxable wages. ​ -Refer to Instruction 5-1.Sparks Company's SUTA rate for next year is 3.25% because its reserve ratio falls into the state's 10% to less than 12% category [(contributions - benefits paid)÷ average payroll = $414,867 ÷ $3,521,790 = 11.78%].If the next bracket (12% to less than 14%)would give the company a lower tax rate of 3.05%,what would be the least amount of the voluntary contribution needed to qualify the company for the 3.05% SUTA tax rate?

Unemployment taxes (FUTA and SUTA)do not have to be paid by an employer who has only part-time employees.

Once a company attains the status of employer for FUTA purposes,that status continues for four calendar years.

For FUTA purposes,the cash value of remuneration paid in any medium other than cash is not considered taxable wages.

A traveling salesperson who solicits and transmits to the principal orders for merchandise for resale is considered an employee under FUTA.

The mailing of Form 940 is considered timely if it is postmarked on or before the due date.

Insurance agents paid solely on a commission basis are not considered employees under FUTA.

If an employer is subject to a credit reduction because of Title XII advances,the penalty for the entire year will be paid only with the deposit for the last quarter of the year.

The Social Security Act ordered every state to set up an unemployment compensation program.

An aspect of the interstate reciprocal arrangement concerns: