Hamad Is an Employee of Mountain Company

question 30

Multiple Choice

Hamad is an employee of Mountain Company.He properly completed his Form 1040EZ tax return and was required to pay the IRS $1,374 at the time of filing.He had income tax withholding during the year of $4,429.His tax liability for the year was:

• A)$5,803.
• B)$4,429.
• C)$3,055.
• D)$1,374.

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Definitions:

Pension Contributions

Funds put into a pension plan by individuals or employers intended to finance retirement benefits.

Health Contributions

Payments made towards health insurance or healthcare services, often deducted from an employee's salary or made by employers.

Federal Depository Banks

Banks that are authorized to hold deposits for the Federal Reserve System, facilitating the federal government's cash management and payments.

FUTA

The Federal Unemployment Tax Act, which imposes a payroll tax on employers in order to fund state workforce agencies and unemployment insurance.