Question

When determining an employer's payroll tax deposit schedule, the determination is made based on _______.

The start date of the tax year.

The total tax liability in the lookback period.

The prior-year absorption rate.

The number of employees.

Answer 1

When determining the employer’s payroll tax deposit at the beginning of the calendar year, identification of the lookback period is done. Then the total tax reported in the lookback period are added. Therefore, the total tax liability in the lookback period is the correct option.

The start date of the tax year is incorrect option as it is not required

The prior-year absorption rate is incorrect as total tax liability in the lookback period is required.

The number of employees is incorrect as it is not required.

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