Certified Payroll Professional Practice Exam

What is the purpose of Form W-4S in the payroll process?

1. Enrollment in savings plans

2. Authorization for direct deposit

3. Adjusting pension contributions

4. Requesting Federal Income Tax withholding from sick pay

The correct answer is: Requesting Federal Income Tax withholding from sick pay

Form W-4S is used to request Federal Income Tax withholding from sick pay. When an employee receives sick pay, they can use Form W-4S to specify the amount of federal income tax they want withheld from these payments. This form ensures that the appropriate taxes are withheld at the time sick pay is issued, avoiding any potential tax liability at the end of the year. The other options are not the correct purposes of Form W-4S: A. Enrollment in savings plans is typically done through specific enrollment forms for retirement or savings plans, not through Form W-4S. B. Authorization for direct deposit is usually done using a direct deposit authorization form, not Form W-4S. C. Adjusting pension contributions is unrelated to Form W-4S, as pension contributions are typically adjusted through retirement plan contribution forms or through separate payroll deduction processes.