Practice Free FPC-REMOTE Exam Online Questions
Question #11
To optimize customer service, policies should include attributes which are:
- A . Reliable
- B . Fluctuating
- C . Interchangeable
- D . Intangible
Correct Answer: A
A
Explanation:
Good payroll customer service policies should be:
Reliable (Option A) C Consistent and dependable for employees.
Accurate C Ensuring payroll is error-free.
Responsive C Quick resolution of inquiries.
Option B (Fluctuating) is incorrect because inconsistent policies confuse employees.
Option C (Interchangeable) is incorrect because policies must be specific to payroll needs.
Option D (Intangible) is incorrect because customer service policies should be well-defined and enforceable.
Reference: Payroll.org C Payroll Customer Service Best Practices
HR Compliance Guide C Employee Service Expectations
A
Explanation:
Good payroll customer service policies should be:
Reliable (Option A) C Consistent and dependable for employees.
Accurate C Ensuring payroll is error-free.
Responsive C Quick resolution of inquiries.
Option B (Fluctuating) is incorrect because inconsistent policies confuse employees.
Option C (Interchangeable) is incorrect because policies must be specific to payroll needs.
Option D (Intangible) is incorrect because customer service policies should be well-defined and enforceable.
Reference: Payroll.org C Payroll Customer Service Best Practices
HR Compliance Guide C Employee Service Expectations
Question #12
When a payer receives a “B” Notice, it must send a copy of the notification to the payee within:
- A . 15 days.
- B . 30 days.
- C . 60 days.
- D . 90 days.
Correct Answer: B
B
Explanation:
A "B" Notice (Backup Withholding Notice) is sent by the IRS when a payee’s taxpayer ID does not match records.
The employer must notify the payee within 30 days to correct their details.
Failure to comply results in backup withholding of 24% on future payments.
Reference: IRS Publication 1281 (Backup Withholding Notices)
B
Explanation:
A "B" Notice (Backup Withholding Notice) is sent by the IRS when a payee’s taxpayer ID does not match records.
The employer must notify the payee within 30 days to correct their details.
Failure to comply results in backup withholding of 24% on future payments.
Reference: IRS Publication 1281 (Backup Withholding Notices)
Question #13
Exempt employee master file data should include all of the following elements EXCEPT:
- A . Minimum Wage
- B . Payment Dates
- C . Work Location
- D . Rate of Pay
Correct Answer: A
A
Explanation:
The employee master file for an exempt employee should include:
Payment Dates (B) C To ensure timely payroll processing.
Work Location (C) C For tax and compliance purposes.
Rate of Pay (D) C Required for salary calculations.
Option A (Minimum Wage) is incorrect because exempt employees are not subject to minimum wage laws under FLSA.
Reference: Fair Labor Standards Act (FLSA) C Exempt Employee Requirements Payroll.org C Employee Master File Best Practices
A
Explanation:
The employee master file for an exempt employee should include:
Payment Dates (B) C To ensure timely payroll processing.
Work Location (C) C For tax and compliance purposes.
Rate of Pay (D) C Required for salary calculations.
Option A (Minimum Wage) is incorrect because exempt employees are not subject to minimum wage laws under FLSA.
Reference: Fair Labor Standards Act (FLSA) C Exempt Employee Requirements Payroll.org C Employee Master File Best Practices
Question #14
Which of the following plans may be treated as a nonqualified plan?
- A . 401(k)
- B . 403(b)
- C . 408(p)
- D . 457(b)
Correct Answer: D
D
Explanation:
A 457(b) plan is a nonqualified deferred compensation plan offered primarily to government and tax-exempt employees.
Option A (401(k)) and Option B (403(b)) are qualified retirement plans under ERISA. Option C (408(p)) refers to a SIMPLE IRA, which is also a qualified plan.
Reference: IRS C 457(b) Plan Rules and Compliance
Payroll.org C Qualified vs. Nonqualified Retirement Plans
D
Explanation:
A 457(b) plan is a nonqualified deferred compensation plan offered primarily to government and tax-exempt employees.
Option A (401(k)) and Option B (403(b)) are qualified retirement plans under ERISA. Option C (408(p)) refers to a SIMPLE IRA, which is also a qualified plan.
Reference: IRS C 457(b) Plan Rules and Compliance
Payroll.org C Qualified vs. Nonqualified Retirement Plans
Question #15
The FLSA requires employers to retain employee work time schedules for at least:
- A . 2 years.
- B . 3 years.
- C . 4 years.
- D . 7 years.
Correct Answer: B
B
Explanation:
FLSA requires that work time schedules, payroll records, and related documents be kept for a minimum of 3 years.
Reference: Fair Labor Standards Act (FLSA) Recordkeeping Requirements (DOL)
B
Explanation:
FLSA requires that work time schedules, payroll records, and related documents be kept for a minimum of 3 years.
Reference: Fair Labor Standards Act (FLSA) Recordkeeping Requirements (DOL)
Question #16
Under the CCPA, use the following information to calculate the MAXIMUM deduction for the child support order for an employee who is not supporting another family and not in arrears.
- A . $113.53
- B . $116.03
- C . $136.23
- D . $139.23
Correct Answer: D
D
Explanation:
Step 1: Calculate disposable earnings
$300.00 – ($45.00 + $18.60 + $4.35) = $232.05
Step 2: Apply CCPA withholding limit
60% of $232.05 = $139.23
Reference: Consumer Credit Protection Act (CCPA) – Federal Child Support Withholding Limits Payroll Withholding Compliance Guide (Payroll.org)
D
Explanation:
Step 1: Calculate disposable earnings
$300.00 – ($45.00 + $18.60 + $4.35) = $232.05
Step 2: Apply CCPA withholding limit
60% of $232.05 = $139.23
Reference: Consumer Credit Protection Act (CCPA) – Federal Child Support Withholding Limits Payroll Withholding Compliance Guide (Payroll.org)
Question #17
An employee receives a total of $200.10 in cash tips in July. Determine the latest date the employee MUST report tip income to the employer.
- A . August 10
- B . September 10
- C . September 30
- D . December 31
Correct Answer: A
A
Explanation:
Under IRS regulations, employees must report tips totaling $20 or more per month to their employer by the 10th day of the following month.
Employee received $200.10 in tips in July.
Tip income must be reported by August 10.
Option B (September 10), Option C (September 30), and Option D (December 31) are incorrect because the IRS mandates monthly reporting.
Reference: IRS Publication 531 C Reporting Tip Income
Payroll.org C Employer Tip Withholding Responsibilities
A
Explanation:
Under IRS regulations, employees must report tips totaling $20 or more per month to their employer by the 10th day of the following month.
Employee received $200.10 in tips in July.
Tip income must be reported by August 10.
Option B (September 10), Option C (September 30), and Option D (December 31) are incorrect because the IRS mandates monthly reporting.
Reference: IRS Publication 531 C Reporting Tip Income
Payroll.org C Employer Tip Withholding Responsibilities
Question #18
All of the following resources are available to help a Payroll Professional stay abreast of regulatory changes EXCEPT the:
- A . PAYO
- B . DOL
- C . FTC
- D . IRS
Correct Answer: C
C
Explanation:
Payroll professionals must stay updated on tax laws, wage regulations, and compliance requirements. Key resources include:
A (PAYO C Payroll.org) → Provides training, updates, and compliance resources.
B (DOL C Department of Labor) → Oversees wage & hour laws (FLSA).
D (IRS C Internal Revenue Service) → Issues payroll tax regulations.
Option C (FTC C Federal Trade Commission) is incorrect because the FTC does not regulate payroll laws. The FTC primarily monitors consumer protection laws.
Reference: Payroll.org C Payroll Compliance Updates
IRS & DOL C Payroll Tax and Wage Regulations
C
Explanation:
Payroll professionals must stay updated on tax laws, wage regulations, and compliance requirements. Key resources include:
A (PAYO C Payroll.org) → Provides training, updates, and compliance resources.
B (DOL C Department of Labor) → Oversees wage & hour laws (FLSA).
D (IRS C Internal Revenue Service) → Issues payroll tax regulations.
Option C (FTC C Federal Trade Commission) is incorrect because the FTC does not regulate payroll laws. The FTC primarily monitors consumer protection laws.
Reference: Payroll.org C Payroll Compliance Updates
IRS & DOL C Payroll Tax and Wage Regulations
Question #19
A terminated employee submits a written request on August 1 for the current year Form W-2. By what date MUST the employer furnish the Form W-2?
- A . August 31
- B . September 30
- C . October 31
- D . January 31
Correct Answer: A
A
Explanation:
If a terminated employee requests a Form W-2 in writing, the employer must provide it within 30 days or by January 31, whichever comes first.
Since the request was made on August 1, the deadline is August 31.
Reference: IRS Form W-2 Guidelines
A
Explanation:
If a terminated employee requests a Form W-2 in writing, the employer must provide it within 30 days or by January 31, whichever comes first.
Since the request was made on August 1, the deadline is August 31.
Reference: IRS Form W-2 Guidelines
Question #20
Specifying a defined response time for an employee’s payroll-related question is a component of a Payroll Department’s:
- A . General Service Contract
- B . Service Level Agreement
- C . Standards of Excellence
- D . Time Management
Correct Answer: B
B
Explanation:
A Service Level Agreement (SLA) (Option B) outlines the expected response times and resolution times for payroll inquiries, ensuring efficient service delivery.
Option A (General Service Contract) is incorrect because it governs third-party payroll providers, not internal payroll responses.
Option C (Standards of Excellence) is incorrect because it refers to broad performance benchmarks rather than defined service times.
Option D (Time Management) is incorrect because it focuses on individual productivity, not service expectations.
Reference: Payroll.org C Payroll Service Level Agreements Best Practices HR Compliance Guide C Payroll Inquiry Handling
B
Explanation:
A Service Level Agreement (SLA) (Option B) outlines the expected response times and resolution times for payroll inquiries, ensuring efficient service delivery.
Option A (General Service Contract) is incorrect because it governs third-party payroll providers, not internal payroll responses.
Option C (Standards of Excellence) is incorrect because it refers to broad performance benchmarks rather than defined service times.
Option D (Time Management) is incorrect because it focuses on individual productivity, not service expectations.
Reference: Payroll.org C Payroll Service Level Agreements Best Practices HR Compliance Guide C Payroll Inquiry Handling