What is the first step in payroll processing?
The first step in payroll processing involves gathering employee timecards or time logs for accurate wage calculation.
What is the purpose of the W-2 form in payroll?
The W-2 form reports an employee's annual wages and the taxes withheld from their paycheck.
What is FICA?
FICA stands for the Federal Insurance Contributions Act, which mandates payroll taxes to fund Social Security and Medicare.
Which payroll tax is applied to employee wages for unemployment benefits?
The Federal Unemployment Tax Act (FUTA) tax is applied to wages for funding unemployment benefits.
What is the main purpose of calculating net pay?
Net pay is the amount employees take home after all deductions, such as taxes and benefits, have been subtracted from the gross pay.
Which of the following is considered a pre-tax deduction?
Pre-tax deductions reduce an employee's taxable income, which can lower their overall tax liability.
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What is the tax rate for Social Security?
The Social Security tax rate for employees is 6.2% on wages up to the annual wage base limit.
How often are federal payroll tax deposits typically made?
Federal payroll tax deposits are typically made on a semi-weekly, monthly, or quarterly basis, depending on the amount of taxes the employer withholds.
What should be included in the year-end payroll report?
The year-end payroll report should include total wages paid, taxes withheld, and all deductions for each employee.