CPP Misc 2 Flashcards
Defined benefit pension plan
A plan in which employees are promised a certain level of benefits
Totalization Agreement
Pay SS tax in only 1 country
Business expense advances not spent
Must be returned to the employer within 120 days after the expenses were incurred to avoid taxation.
Group Term Life
Is reported on Form W2 but not subject to federal income tax withholding
Federal Tax Levy - what deductions are allowed from the employee’s pay when the employer receives a federal tax levy
Mandatory taxes, and all voluntary and involuntary deductions currently in place
Form 4070
Report used by employees to report tips
To continue exempt status a new W4 form is required by
February 15th
Substantial Presence Test
- 31 days current year
- 1/3 days 1st preceding year
- 1/6 days 2nd preceding year
Must equal at least 183 days
Physical Presence Test
Present in a foreign country 330 days over a 12 month period to qualify for the foreign earned income exclusion
Form 2555
Form filed to claim bonafide resident status
Excluding Foreign Earned Income
US citizens & resident alien employees working outside the US can exclude up to $101,300 of foreign earned income from their gross income in 2016.
16% of 101,300
Ex: 26,500-16208 = 10292
Accounting
Payable = Credit
Expense = Debit
Withheld = Credit
Form 944 - Annual
Employer’s who have a payroll tax liability of up to $1000 in a calendar year must file Form 944
Tax Liability $100k and over
If an employer’s tax liability reaches $100,00 on any day, no matter the deposit schedule, the liability must be deposited on the next business day.
Semiweekly Tax Depositors
Tax Liability
Wages paid on Wednesday, Thursday, Friday - must be paid the following Wednesday
Wages paid on Saturday, Sunday, Monday, Tuesday - taxes must be paid the following Friday
Monthly Tax Depositors
Tax Liability
Deposit taxes by the 15th of the following month
Priorities of Withholding Orders
Child Support Orders Federal Tax Levy (1st unless a child support order is already in place) Bankruptcy Orders Federal administrative garnishments Student loan garnishments State tax levies Local tax levies Creditor Garnishments
Child Support Orders
Maximum amount to withhold
If current:
50% of disposable earnings of the employee is supporting another spouse/children
60% of disposable earnings if the employee is not supporting another spouse/children
If at least 12 weeks late on payments:
55% of the employee’s disposable earnings if the employee is supporting another spouse/children
65% of the employee’s disposable earnings if the employee is not supporting another spouse/children
