M2: Quizzes

Question 1

Employee contributions to a health insurance plan
are included in the employee’s taxable income for
purposes of all of these taxes, unless the contributions
are made through a cafeteria plan in accordance with
Internal Revenue Code _______.

A. 89
B. 125
C. 120
D. 79

Answer 1

B. 125

Study Guide, Page 7, Learning Outcome 1.2; Text, Page 30

Question 2

The IRS final regulations define the terms
spouse, husband and wife in a gender neutral way, for
all federal tax purposes, to mean an individual lawfully
married to another individual; the phrase husband
and wife means two individuals lawfully married to
each other.

A. 2018
B. 2016
C. 2015
D. 2017

Answer 2

B. 2016

2013-allows for federal same-sex benefits
2015-legalize same-sex marriage

Study Guide, Page 9, Learning Outcome 2.2; Text, Page 32

Question 3

Small self-insured employers (i.e., an employer with fewer than _____ full-time employees) must complete and file Form 1095-B.

A. 100
B. 75
C. 50
D. 25

Answer 3

C. 50

Study Guide, Page 13, Learning Outcome 3.3; Text, Page 33

Question 4

______ were made obsolete (although existing ones were grandfathered) by the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA) with the creation of HSAs.

A. HDHPs
B. MSAs
C. HRAs
D. FSAs

Answer 4

B. MSAs

Study Guide, Page 15, Learning Outcome 4.3; Text, Page 4

Question 5

Employee contributions to a §401(k) plan are subject to an annual, inflation-adjusted limitation amount. Employees who will be age ____ or older by the end of the plan year are allowed to make catch-up
contributions above the annual contribution limit up to an annual maximum amount. These amounts are adjusted annually for inflation.

A. 65
B. 60
C. 55
D. 50

Answer 5

D. 50

Study Guide, Page 24, Learning Outcome 7.2; Text, Page 51

Question 6

A(n) __________ plan is an option for employers that do not have the financial resources to administer more complicated deferred compensation plans such as 401(k) plans.

A. MSA
B. IRA
C. SEP
D. Roth IRA

Answer 6

C. SEP

Study Guide, Page 25, Learning Outcome 7.3; Text, Page 51-52

Question 7

Cafeteria plans may offer employees more than ______ of group-term life insurance to an employee as a qualified benefit per Section 79 of the IRS. There are no tax consequences if the total amount of such
policies does not exceed a certain threshold.

A. $25,000
B. $50,000
C. $30,000
D. $20,000

Answer 7

B. $50,000

Study Guide, Page 22, Learning Outcome 6.6; Text, Page 49-50

Question 8

A health ______ is an arrangement under which employees may reduce their current cash compensation (i.e., they may make pre-tax contributions) and instead have that amount contributed to a plan for use in reimbursing them or their dependents for medical expenses.

A. HRA
B. HDHP
C. FSA
D. HSA

Answer 8

C. FSA

Study Guide, Page 21, Learning Outcome 6.4; Text, Page 47-48

Question 9

Prior to ______, employers could structure health insurance plans offered through a third-party insurance company to favor _______ without jeopardizing the tax exclusion for employer contributions and reimbursements.

A. 2016, HCEs
B. the ACA, HECs
C. 2016, HECs
D. the ACA, HCEs

Answer 9

D. the ACA, HCEs

Study Guide, Page 11, Learning Outcome 3.1; Text, Page 32

Question 10

Among the coverage types and arrangements that need not be reported on the W-2 are payments or reimbursements of health insurance premiums made for _____ S corporation shareholder employees that are included in the employee’s gross income.

A. 5%
B. 3%
C. 6%
D. 2%

Answer 10

D. 2%

Study Guide, Page 12, Learning Outcome 3.2; Text, Page 34-35

Question 11

Payments made to employees who are disabled and not returning to work are subject to FIT withholding to the extent that the premiums were paid by the employer or the employee on a pre-tax basis.

True or False?

Answer 11

True

Question 12

Sick pay is usually provided by employers so that employees do not lose wages when they are absent from work because of brief minor illnesses, such as a cold or the flu. This type of sick pay is subject to FIT, FICA taxes, and FUTA taxes when paid.

Answer 12

True

Question 13

As a general rule, workers’ compensation benefits are subject to FIT or FICA taxes on amounts that do not exceed the amount of benefits provided under federal, state, or local law.

Answer 13

False

Question 14

Educational assistance benefits are a common type of qualified benefit that may be offered under a cafeteria plan.

Answer 14

False

Question 15

Employee contributions to a health insurance plan are included in the employee’s taxable income for purposes of all of these taxes, unless the contributions are made through a cafeteria plan in accordance with Internal Revenue Code 125.

Answer 15

True

Question 16

If an FSA plan does not allow rollovers, amounts remaining in an FSA account at the end of the plan year are forfeited by the employee or 2 months after the end of the year if the employer has adopted a grace period.

Answer 16

False

(2 1/2 months)

Question 17

Health and accident insurance plan payment benefits are not taxable income to the employee so long as the employee’s expenses are for medical care defined by the IRS.

Answer 17

True

Question 18

The 2018 IRS final regulations define the terms spouse, husband, and wife in a gender-neutral way, for all federal tax purposes to mean an individual lawfully married to another individual; the phrases husband and wife mean two individuals lawfully married to each other.

Answer 18

False

(2016)

Question 19

An HRA does not reimburse medical expenses for a prior tax year, expenses incurred before the HRA plan became effective, and expenses incurred before the employee enrolled in the plan.

Answer 19

True

Question 20

Small self-insured employers (i.e., an employer with fewer than 50 full-time employees) must complete and file Form 1095-C.

Answer 20

False

Question 21

For non-discrimination purposes, the top-paid ____ of employees are considered Highly Compensated Employees.

A. 30%
B. 10%
C. 25%
D. 5%

Answer 21

C. 25%

Module 2 quiz
Study Guide Pg. 33

Question 22

Employers that file fewer than ____ W-2’s for the preceding year do not have to report employee’s health benefits until the IRS provides further notice.

A. 250
B. 200
C. 300
D. 100

Answer 22

A. 250

Module 2 quiz
Study Guide Pg. 35

Question 23

Under the 21st Century Cures Act, an eligible small employer (one that does not have at least 50 full-time employees, including full time equivalent employees) and does not offer its employee group major medical may offer stand-alone qualified small employer ______.

A. QSEHRAs
B. ESOPs
C. IRAs
D. HRAs

Answer 23

A. QSEHRAs

Module 2 quiz
Study guide Pg. 40

Question 24

The PPACA requires health insurers in both the large and small markets to spend the vast majority of premiums collected directly on health care or health care improvement. Employers who do not spend between ______ of collected premiums on health care or health improvement must make medical loss rebates to plan sponsors and employees.

A. 80% to 85%
B. 60% to 65%
C. 90% to 95%
D. 75% to 80%

Answer 24

A. 80% to 85%

Module 2 quiz
Study guide Pg. 48-49

Question 25

Several penalty adjustments apply to the protections afforded under the Genetic Information Nondiscrimination Act (GINA). Individuals denied access to group health coverage based on their genetic information could result in civil penalties of up to ____ per day.

A. $110
B. $120
C. $100
D. $150

Answer 25

B. $120

Module 2 quiz
Study guide Pg. 47

Question 26

The Affordable Care Act requires individual and group health plans to provide a written summary of benefits and coverage (SBC). The penalty for failure to provide an SBC is now ____ in 2021.

A. $1,150
B. $1,200
C. $1,190
D. $1,250

Answer 26

C. $1,190

Module 2 quiz
Text 46-47

Question 27

A multiple employer welfare arrangement (MEWA) providing health coverage to employees of two or more employers that are not part of a control group of businesses is required to file an annual Form _____ report.

A. W-2
B. M-2
C. M-1
D. W-1

Answer 27

C. M-1

Module 2 quiz
Text pg 45

Question 28

The Family and Medical Leave Act (FMLA) provides for up to 12 weeks per 12-month period of job-protected leave for purposes of serious health conditions. Employers subject to FMLA include private and public sector employers employing _____ or more employees on each working day in at least 20 or more calendar weeks in the current or preceding calendar year.

A. 50
B. 75
C. 150
D. 100

Answer 28

A. 50

Module 2 quiz
Text pg 47

Question 29

FMLA covered employers are required to post a general notice of FMLA rights and protections in each of their workplace locations. Pursuant to regulations, the penalty for violations of the FMLA posting requirements by the DOL’s Wage and Hour Division is ____ in 2021.

A. $176
B. $178
C. $165
D. $180

Answer 29

B. $178

Module 2 quiz
Text pg 48

Question 30

As part of the DOL’s Delinquent Filer Voluntary Compliance Program, top hat plans and apprentice and training plans that file delinquent returns will have a penalty that is capped at _____.

A. $900
B. $700
C. $650
D. $750

Answer 30

D. $750

Module 2 quiz
Text pg 44

Question 31

ER contributions that exceed the annual limit/are made for a non-eligible individual are included in the EE’s gross income. HSA beneficiaries pay a ___ percent excise tax on excess contributions.

A. 5
B. 3
C. 6
D. 10

Answer 31

D. 10??

Module 2 Poll

Question 32

An eligible small employer that does not offer its employees group major medical coverage may offer a standalone ___________.

A. HRA
B. HDHP
C. FSA
D. QSEHRA

Answer 32

D. QSEHRA??

Module 2 Poll