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Alright, everybody, so the SBA this week came out and said that it has stopped accepting new PPP applications from most lenders. The SBA informed lenders this past Tuesday that the PPP general fund was out of money and that the only remaining funds available for new applications are $8 billion set aside for community financial institutions (CFIs), which are institutions that specifically work with businesses in underserved communities. But all is not lost, dear small business owners of America. If you missed out on the PPP or if you did not qualify for the PPP, don't lose hope because you may still qualify for the employee retention credit on all those wages you didn't claim for PPP forgiveness, and this employee retention credit could be worth up to $28,000 per employee. And yes, even if you got PPP money, you can still get a piece of this employee retention credit cake.
Services supplied can include:
Devoted experts that will certainly analyze extremely complicated program policies and will be offered to address your concerns, including:
What period does the program cover?
Greece NY Employee Retention Ertc
Alright, everybody, so the SBA this week came out and said that it has stopped accepting new PPP applications from most lenders. The SBA informed lenders this past Tuesday that the PPP general fund was out of money and that the only remaining funds available for new applications are $8 billion set aside for community financial institutions (CFIs), which are institutions that specifically work with businesses in underserved communities. But all is not lost, dear small business owners of America. If you missed out on the PPP or if you did not qualify for the PPP, don't lose hope because you may still qualify for the employee retention credit on all those wages you didn't claim for PPP forgiveness, and this employee retention credit could be worth up to $28,000 per employee. And yes, even if you got PPP money, you can still get a piece of this employee retention credit cake.
How It Works
Even if you do not own a company, be sure to share this video with organization owners you know, this video could actually be worth tens of thousands of dollars for them. And if you are a company owner and after you enjoy this video you desire to talk with me and a member of my team, who will likewise be either a CPA like myself or an EA, shoot me an e-mail, [email protected], inform me a little about your company and your ballpark year-over-year revenue, and let's see if we can get some more cash back in your pocket because you can take this credit against your payroll taxes you pay by lowering your required work tax deposits or you can request an advance payment of the credit using IRS Form 7200, Advance Payment of Employer Credits Due to COVID-19.
Because that's the stuff your CPA should stress about, I am not going to get into the complexities of that kind here or the Form 941 and all the payroll things. In this video I want to tell you what you need to understand so you can go to your CPA and state, "Hey, what about this employee retention credit, why haven't you told me about this?" so you can be informed and take ownership of your own tax scenarios, of your organization's tax circumstance to create more cash circulation in your company and more wealth for yourself.
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About Employee Retention Ertc
Alright, now let's dig into this and let's talk about the employee retention credit or the ERC as some folks like to call it, prior to I get into this, I desire to state that absolutely nothing in this video is to be taken as legal or tax guidance, this video is for basic informative functions just, yes, I am a CPA and a tax professional, but I am not your CPA nor your tax expert unless you have actually engaged my firm. Another disclaimer here, for functions of this video I am assuming that if you're enjoying this you are a little company owner, which for employee retention credit purposes implies one hundred or fewer employees for functions of the 2020 credit and 5 hundred or less employees for purposes of the 2021 credit, if you have a business with over 5 hundred workers I envision you have in-house counsel, in-house CPAs who are on top of this stuff, but I'm here for you small company owners who might work with a local tax expert who is so neck-deep in income tax return right now due to the fact that the government extended the tax deadline to May 17 or volume is just the nature of their company that your tax professional hasn't had the time to dig into the weeds here like I have.
Employee retention credit, why is it so profitable for company owners in 2021 and why weren't we talking about it in 2020, it's been around because then, considering that the CARES Act? Why is it getting all this buzz now that it wasn't last year? Well, let's back it up. Yes, the employee retention credit has actually been around since the CARES Act that was passed over a year ago in March 2020, however the employee retention credit didn't get much love last year in 2020 because of the PPP, the Paycheck Protection Program. Originally, in 2020, if you got a PPP loan as a company, you were not eligible for the employee retention credit.
Basically the employee retention credit had a glow-up between 2020 and 2021, it went from the nerdy lady with thick glasses and neglected eyebrows and her hair up in 2020 to the belle of the ball for service owners in 2021. Why is the employee retention credit more attractive now thanks to the Consolidated Appropriations Act and the American Rescue Plan Act?
Why Employee Retention Ertc
Factor, the employee retention credit for both 2020 and 2021 is now readily available to PPP receivers, however of course you can't double dip. You can't get PPP for the hundred thousand dollars you paid your employees and then turn around and claim the employee retention credit on those wages. If you got PPP and you are eligible for the employee retention credit, then when you do your PPP forgiveness application, you need to choose the finest covered period that will get you complete PPP forgiveness however likewise maximize your employee retention credit.
For PPP forgiveness, you want to fill up that payroll bucket with as numerous expenses as possible that do not count for employee retention credit purposes. You can't declare the employee retention credit on state unemployment insurance coverage contributions, however state joblessness insurance coverage contributions count towards PPP forgiveness, see? You 'd desire to discard all your state unemployment insurance coverage contributions on your PPP forgiveness application to leave as much ordinary wages as possible to take the employee retention credit on.
Another thing to note is you can't deduct the incomes you claimed the employee retention credit on, and that makes sense as well, why should the federal government give you a deduction for these earnings that they already provided you a credit for? Alright, sorry for getting a little sidetracked there, I just like talking about this things, but let's talk about another reason why the employee retention credit is more appealing now than it was last year, and that is that it's much easier to certify for the employee retention credit in 2021.
However in 2021, for a quarter to receive the employee retention credit, you only need to reveal a 20% reduction in gross receipts compared to the very same calendar quarter in 2019. So this indicates much more services will qualify. My business, for example, experienced a 26% decrease in gross receipts, comparing Q1 2019 to Q1 2021, and it was a comparable story last year too.
I didn't certify for the 2020 employee retention credit initially, since I got first round of PPP money and 2nd because my business didn't suffer that big 50% decline needed to certify for the employee retention credit last year.But for 2021, at least for Q1, yeah, my business qualifies. Likewise, for 2021, for any quarter, you can elect to use the lookback quarter, indicating that, for example, even if your Q1 2021 gross receipts aren't at least 20% lower than your Q1 2019 gross invoices, you can compare for functions of determining eligibility for the employee retention credit for Q1 2021, you can compare Q4 2020 to Q4 2019. Ramification here is that if you get approved for Q1 2021 based on Q1 2021's gross receipts, you will also receive Q2 2021 given that you certified in the lookback quarter of Q1 2021.
Same thing for Q2 to Q3 and Q3 to Q4, so basically if you just get approved for Q1 and Q3 2021, you likewise get approved for Q2 and Q4 based on the lookback. Even if you didn't have an enough decline in earnings, you can certify for the employee retention credit if you were needed to fully or partially suspend operations in your company during any calendar quarter in 2020 or 2021 due to state or federal orders, in which case you are qualified for the employee retention credit throughout that duration of partial or full shutdown.
Common example, you own a restaurant, and your governor signed an executive order specifying that you require to close down indoor dining. That is an example of a partial shutdown. Also, not just are more businesses eligible for the employee retention credit thanks to these new laws, making PPP receivers eligible for the employee retention credit though not on the very same wages and making more businesses eligible through the 20% decline threshold rather than the 50% decrease threshold, however the 2021 credit is likewise more rewarding than the 2020 credit.
This is because for 2020, the employee retention credit was equivalent to 50% of all qualified incomes for 2020, the employee retention credit amounted to 50% of all certified salaries you paid employees in between March 12, 2020, and December 31, 2020, with a limit of $10,000 in earnings for that entire time period. So the optimum 2020 credit per worker was $5,000. Okay, however that's absolutely nothing compared to the 2021 credit since for 2021, the credit is equal to 70% of qualified incomes per worker paid from January 1, 2021 through December 31, 2021, limited to $10,000 in wages per worker ... for that whole period? No. Per quarter. For 2021 the percentage is more (70% in 2021 vs. 50% in 2020) and you can take it on up to $10,000 in earnings per employee per quarter, so we're talking about a maximum credit of $7,000 per staff member per quarter. If you're eligible all four quarters, $7,000 times 4 is $28,000. That's right, folks, the optimum 2021 employee retention credit is $28,000 per worker. That's big. That's a godsend to many entrepreneur today. You see what I mean now, right, how the employee retention credit has gone from unsightly duckling in 2020 to lovely swan in 2021? And by the way, by the method, certified salaries includes employer-paid medical insurance premiums.
If you got PPP and you are qualified for the employee retention credit, then when you do your PPP forgiveness application, you require to select the best covered duration that will get you complete PPP forgiveness however also maximize your employee retention credit.
Alright, sorry for getting a little sidetracked there, I just like talking about this stuff, however let's talk about another reason why the employee retention credit is more appealing now than it was last year, and that is that it's much easier to certify for the employee retention credit in 2021. I didn't qualify for the 2020 employee retention credit first, because I got very first round of PPP money and second because my service didn't suffer that big 50% decrease required to certify for the employee retention credit last year.But for 2021, at least for Q1, yeah, my service certifies. Not just are more companies eligible for the employee retention credit thanks to these brand-new laws, making PPP receivers eligible for the employee retention credit though not on the very same wages and making more companies eligible through the 20% decline limit rather than the 50% decrease limit, however the 2021 credit is likewise more rewarding than the 2020 credit.
Not bad, however that's absolutely nothing compared to the 2021 credit because for 2021, the credit is equivalent to 70% of certified earnings per staff member paid from January 1, 2021 through December 31, 2021, limited to $10,000 in wages per worker ... for that entire time duration?
Exactly How to Begin
The very best means is to deal with a no-risk, contingency-based cost financial savings business. That will certainly negotiate on part of their clients to get the most effective prices feasible for their existing clients. They will investigate old invoices for mistakes getting their clients refunds and credits. They can boost the profitability as well as general appraisal of their clients organizations.
Services supplied can include:
Devoted experts that will certainly analyze extremely complicated program policies and will be offered to address your concerns, including:
Just how does the PPP funding aspect right into the ERC?
What are the distinctions in between the 2020 as well as 2021 programs as well as exactly how does it relate to your business?
What are gathering policies for bigger, multi-state employers, and also exactly how do I translate numerous states executive orders?
Just how do part-time, Union, and tipped employees affect the quantity of my refunds?
Detailed analysis regarding your eligibility
Detailed evaluation of your situation
Advice on the declaring process as well as documents
Particular program experience that a routine certified public accountant or pay-roll cpu might not be well-versed in
Smooth and quick end-to-end procedure, from eligibility to declaring and obtaining reimbursements
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| Finance Pro Plus https://www.financeproplus.com/ |
| Bottom Line Concepts https://erc.bottomlinesavings.com/ |
| Equifax Workforce Solutions https://workforce.equifax.com/solutions/employee-retention-credit |
| Valiant Capital https://erc.valiant-capital.com/ |
| NYC Business https://www1.nyc.gov/nycbusiness/article/nyc-employee-retention-grant-program |
| Omega Funding solutions https://www.omegafundingsolutions.com/ |
| Disisaster Loan Advisors https://www.disasterloanadvisors.com/ |
| ERTC Filing https://info.ertcfiling.com/employee-retention-tax-credit-new-york-11368/ |
Ready To Begin? Its Simple.
1. Whichever company you pick to work with will certainly identify whether your business qualifies for the ERC.
2. They will certainly assess your case and compute the maximum amount you can get.
3. Their team overviews you via the declaring process, from beginning to end, consisting of proper paperwork.
Frequently Asked Questions (FAQs)
What period does the program cover?
The program started on March 13th, 2020 and ends on September 30, 2021, for qualified companies.
You can make an application for reimbursements for 2020 and also 2021 after December 31st of this year, into 2022 and 2023. And also potentially beyond after that also.
Many services have received refunds, and also others, in enhancement to reimbursements, additionally qualified to proceed getting ERC in every pay-roll they process through December 31, 2021, at about 30% of their pay-roll expense.
Some services have actually obtained refunds from $100,000 to $6 million.
Do we still certify if we already took the PPP?
Yes. Under the Consolidated Appropriations Act, businesses can now get the ERC also if they already received a PPP car loan. Keep in mind, however, that the ERC will only use to wages not made use of for the PPP.
Do we still certify if we did not) incur a 20% decline in gross invoices .
A federal government authority called for complete or partial shutdown of your service throughout 2020 or 2021. This includes your procedures being restricted by commerce, inability to travel or limitations of group conferences.
- Gross receipt decrease requirements is different for 2020 and 2021, but is gauged against the present quarter as contrasted to 2019 pre-COVID quantities:
- A federal government authority required partial or complete closure of your organization during 2020 or 2021. This includes your operations being restricted by commerce, lack of ability to travel or limitations of team meetings.
- Gross receipt reduction requirements is various for 2020 as well as 2021, but is determined versus the current quarter as compared to 2019 pre-COVID amounts.
Do we still qualify if we continued to be open throughout the pandemic?
Yes. To certify, your company needs to meet either one of the adhering to requirements:
- Experienced a decline in gross receipts by 20%, or
- Needed to transform organization procedures as a result of federal government orders
Numerous products are thought about as modifications in organization operations, consisting of shifts in job duties and also the acquisition of extra safety tools.