) The date by which the deposit should have been made b) The penalty for failure to make timely deposit c) The penalty for failure to fully pay tax when due d) The interest on taxes due and unpaid (assume a 5% interest rate)
Instruction 3-1
Use the following tax rates, ceiling and maximum taxes:
Employee and Employer OASDI: 6.20% $137,700 $8,537.40
Employee* and Employer HI: 1.45% No limit No maximum
Self-employed OASDI: 12.4% $137,700 $17,074.800
Self-employed HI: 2.9% No limit No maximum
*Employee HI: Plus an additional 0.9% on wages over $200,000. Also applicable to self-employed.
Rounding Rules: Unless instructed otherwise compute hourly rate and overtime rates as follows:
1. Carry the hourly rate and the overtime rate to 3 decimal places and then round off to 2 decimals places (round the hourly rate to 2 decimal places
before multiplying by one and one-half to determine the overtime rate).
2. If the third decimal place is 5 or more, round to the next higher cent.
3. If the third decimal place is less than 5, drop the third decimal place.
No deposit was made by the company until August 24, 20-- (9 days late). Determine:
| a) | The date by which the deposit should have been made |
| b) | The penalty for failure to make timely deposit |
| c) | The penalty for failure to fully pay tax when due |
| d) | The interest on taxes due and unpaid (assume a 5% interest rate) |
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