Retirement Plans
T or F: Qualified Retirement Plans are approved by an act of Congress
False
T or F: The larger the number of withholding allowances claimed, the larger the larger the amount of income tax withheld.
False
T or F: Businesses use payroll records to inform employees of their annual earnings and to prepare payroll reports for the government.
True
T or F: When an employee's earnings exceed the tax base, no more social security tax is deducted.
True
The total earnings paid to an employee after payroll taxes and other deductions.
Net Pay
A qualified retirement plan sponsored by an employer.
401(k)
A federal tax paid for hospital insurance.
Medicare tax
What party(s) is(are) responsible for paying social security?
Employee & Employer
Federal income tax is withheld from employee earnings in how many states?
50
A method of paying an employee based on the amount of sales the employee generates.
Commission
A retirement savings plan approved by the Internal Revenue Service that provides individuals with a tax benefit.
Qualified Retirement Plan
A federal tax paid for old-age, survivors, and disability insurance.
Social Security Tax
Payroll taxes represent a _____ for an employer until a payment is made.
Liability
The Accumulated Earnings column of the employee earnings record shows what?
Total earnings since the first of the year
A computerized cash payments system that transfers funds without the use of checks, currency, or other paper documents.
EFT
A qualified retirement plan that provides most individuals with a deferred federal income tax benefit.
Individual Retirement Account
A deduction from total earnings for each person legally supported by a taxpayer, including the employee
Withholding allowance
A ______ is set up to write individual payroll checks.
Separate payroll checking account
The total earnings paid to an employee after payroll taxes and other deductions is recorded in the payroll register's ____ column.
Net Pay
The payment of a employee's net pay using EFTs.
Direct Deposit
A qualified retirement plan that allows tax-free withdrawals from the account
Roth Individual Retirement Plan
You use withholding allowances to calculate what?
Federal Income Taxes Withheld
A business form used to record details affecting payments made to an employee is an
Employee Earnings Record
The amount on the employee earnings record used to determine if certain payroll taxes apply to an employee's earnings is
Accumulated Earnings
The maximum amount of gross earnings on which a tax is calcuated.
Tax base