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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.
I am not going to get into the complexities of that form here or the Form 941 and all the payroll things since that's the stuff your CPA ought to fret about. In this video I wish to inform you what you need to understand so you can go to your CPA and state, "Hey, what about this employee retention credit, why have not you informed me about this?" so you can be informed and take ownership of your own tax circumstances, of your organization's tax situation to produce more capital in your business and more wealth on your own.
Services supplied can include:
Committed specialists that will analyze very intricate program guidelines and will certainly be offered to address your inquiries, including:
What period does the program cover?
Greenburgh NY Employee Retention Ertc Credit
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 Functions
This is huge, a great deal of small company owners do not learn about this, or they've found out about it, however they don't know much about it, even numerous tax specialists do not know the ins and outs of this thing because it's brand-new and a great deal of these changes
that are advantageous to company owner happened in the middle of tax season. So in this video I'm going to go into the employee retention credit, why it's so profitable now in 2021, more rewarding, much more lucrative, in truth now than it remained in 2020, 5x more profitable at least. So even if you don't own a business, make sure to share this video with entrepreneur you know, this video might literally deserve 10s of countless dollars for them. And if you are an entrepreneur and after you watch this video you wish to talk with me and a member of my group, who will also be either a CPA like myself or an EA, shoot me an email, [email protected], inform me a little about your company and your ballpark year-over-year profits, and let's see if we can get some more cash back in your pocket since you can take this credit against your payroll taxes you pay by decreasing your required employment tax deposits or you can request an advance payment of the credit utilizing IRS Form 7200, Advance Payment of Employer Credits Due to COVID-19. I am not going to get into the complexities of that form here or the Form 941 and all the payroll things since that's the stuff your CPA ought to fret about. In this video I wish to inform you what you need to understand so you can go to your CPA and state, "Hey, what about this employee retention credit, why have not you informed me about this?" so you can be informed and take ownership of your own tax circumstances, of your organization's tax situation to produce more capital in your business and more wealth on your own.
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About Employee Retention Ertc Credit
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 suggestions, this video is for basic informative purposes just, yes, I am a CPA and a tax professional, but I am not your CPA nor your tax expert unless you have engaged my firm. Another disclaimer here, for purposes of this video I am assuming that if you're watching this you are a small company owner, which for employee retention credit purposes means one hundred or less staff members 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 employees I envision you have in-house counsel, in-house CPAs who are on top of this stuff, but I'm here for you little service owners who may work with a local tax expert who is so neck-deep in tax returns right now because the federal government extended the tax deadline to May 17 or volume is simply the nature of their service 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 since then, given that the CARES Act? Why is it getting all this buzz now that it wasn't in 2015? Well, let's back it up. Yes, the employee retention credit has actually been around given that the CARES Act that was passed over a year ago in March 2020, but the employee retention credit didn't get much love in 2015 in 2020 because of the PPP, the Paycheck Protection Program. Initially, in 2020, if you got a PPP loan as a company, you were not eligible for the employee retention credit.
Essentially the employee retention credit had a glow-up in between 2020 and 2021, it went from the unpopular girl with thick glasses and neglected eyebrows and her hair up in 2020 to the belle of the ball for organization owners in 2021. Why is the employee retention credit more appealing now thanks to the Consolidated Appropriations Act and the American Rescue Plan Act?
Why Employee Retention Ertc Credit
First factor, the employee retention credit for both 2020 and 2021 is now available to PPP receivers, but of course you can't double dip. You can't get PPP for the hundred thousand dollars you paid your staff members and after that reverse and claim the employee retention credit on those incomes too. The federal government does not look too fondly on paying your payroll for you through the PPP and after that you claiming a credit against the taxes you pay the federal government on those wages that the government paid for you. That makes sense. Now, there's some planning here. If you got PPP and you are qualified for the employee retention credit, then when you do your PPP forgiveness application, you require to choose the best covered duration that will get you full PPP forgiveness however likewise maximize your employee retention credit.
For PPP forgiveness, you desire to fill up that payroll container with as numerous costs as possible that do not count for employee retention credit functions. You can't declare the employee retention credit on state unemployment insurance coverage contributions, but state joblessness insurance contributions count toward PPP forgiveness, see? So you 'd want to dispose all your state unemployment insurance contributions on your PPP forgiveness application to leave as much common earnings as possible to take the employee retention credit on.
So this can get really technical very fast and it's really scenario specific in regards to optimizing PPP vs. ERC and my firm has tools to figure this stuff out for you, I'm not going to go into all that here, but just understand that you really have to do the math when doing your PPP forgiveness to ensure you're not leaving anything on the table in regards to the employee retention credit. Another thing to note is you can't subtract the wages you claimed the employee retention credit on, which makes good sense also, why should the government give you a deduction for these salaries that they already gave you a credit for? So basically the credit is tax-effected. Alright, sorry for getting a little sidetracked there, I simply like speaking about this stuff, but let's discuss another reason that the employee retention credit is more attractive now than it was in 2015, which is that it's simpler to get approved for the employee retention credit in 2021. In 2020, for a quarter to get approved for the employee retention credit, you had to show a 50% decrease in gross invoices compared to the exact same calendar quarter in 2019.
In 2021, for a quarter to qualify for the employee retention credit, you only require to reveal a 20% decline in gross receipts compared to the same calendar quarter in 2019. This implies far more businesses will qualify. My organization, for example, experienced a 26% decrease in gross receipts, comparing Q1 2019 to Q1 2021, and it was a comparable story in 2015 too.
So I didn't receive the 2020 employee retention credit first, due to the fact that I got preliminary of PPP cash and 2nd because my service 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 service certifies. Likewise, for 2021, for any quarter, you can choose to use the lookback quarter, meaning that, for instance, even if your Q1 2021 gross receipts aren't a minimum of 20% lower than your Q1 2019 gross invoices, you can compare for purposes of identifying eligibility for the employee retention credit for Q1 2021, you can compare Q4 2020 to Q4 2019. Ramification here is that if you qualify for Q1 2021 based upon Q1 2021's gross invoices, you will also get approved for Q2 2021 given that you certified in the lookback quarter of Q1 2021.
Very same thing for Q2 to Q3 and Q3 to Q4, so basically if you just receive Q1 and Q3 2021, you likewise qualify for Q2 and Q4 based on the lookback. Likewise, even if you didn't have an adequate decrease in revenue, you can qualify for the employee retention credit if you were needed to fully or partly 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 during that duration of partial or full shutdown.
Typical example, you own a dining establishment, and your governor signed an executive order stating that you require to shut down indoor dining. That is an example of a partial shutdown. Also, not just are more organizations qualified for the employee retention credit thanks to these brand-new laws, making PPP recipients qualified for the employee retention credit though not on the very same incomes and making more businesses eligible through the 20% decline limit instead of the 50% decline limit, however the 2021 credit is likewise more lucrative than the 2020 credit.
Not bad, however that's absolutely nothing compared to the 2021 credit since for 2021, the credit is equal to 70% of qualified salaries per staff member paid from January 1, 2021 through December 31, 2021, restricted to $10,000 in wages per employee ... for that entire time duration? For 2021 the percentage is more (70% in 2021 vs. 50% in 2020) and you can take it on up to $10,000 in incomes per worker per quarter, so we're talking about a maximum credit of $7,000 per staff member per quarter. That's right, folks, the optimum 2021 employee retention credit is $28,000 per worker.
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 full PPP forgiveness however also optimize 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 qualify for the employee retention credit in 2021. I didn't certify for the 2020 employee retention credit first, since I got first round of PPP money and second because my company didn't suffer that big 50% decline required to qualify for the employee retention credit last year.But for 2021, at least for Q1, yeah, my business qualifies. Not only are more businesses qualified for the employee retention credit thanks to these brand-new laws, making PPP recipients eligible for the employee retention credit though not on the exact same incomes and making more organizations eligible through the 20% decline limit rather than the 50% decline limit, but the 2021 credit is also more profitable than the 2020 credit.
Not bad, however that's nothing compared to the 2021 credit because for 2021, the credit is equivalent to 70% of certified salaries per worker paid from January 1, 2021 through December 31, 2021, restricted to $10,000 in incomes per worker ... for that whole time duration?
Just How to Get going
The best way is to function with a no-risk, contingency-based price savings business. That will discuss in support of their customers to obtain the finest costs possible for their existing customers. They will certainly examine old billings for mistakes getting their clients refunds and credits. They can boost the profitability and also total assessment of their customers companies.
Services supplied can include:
Committed specialists that will analyze very intricate program guidelines and will certainly be offered to address your inquiries, including:
Exactly how does the PPP finance variable right into the ERC?
What are the distinctions in between the 2020 and 2021 programs and also exactly how does it use to your service?
What are aggregation guidelines for bigger, multi-state employers, and also how do I translate multiple states executive orders?
Just how do part-time, Union, and tipped staff members influence the quantity of my reimbursements?
Extensive analysis concerning your qualification
Comprehensive analysis of your situation
Guidance on the declaring process and also documents
Particular program know-how that a normal CPA or pay-roll processor may not be well-versed in
Quick as well as smooth end-to-end procedure, from eligibility to claiming and getting refunds
| Adams Brown Strategic Allies and CPAs https://www.adamsbrowncpa.com/ertc-tax-credit-consulting-new-york/ |
| 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/ |
Prepared To Get Going? Its Simple.
1. Whichever company you select to work with will certainly identify whether your business qualifies and gets approvel for the ERC.
2. They will assess your claim as well as compute the optimum quantity you can obtain.
3. Their team guides you via the claiming process, from beginning to finish, including proper paperwork.
Frequently Asked Questions (FAQs)
What period does the program cover?
The program began on March 13th, 2020 as well as right on September 30, 2021, for eligible organizations.
You can get refunds for 2020 and also 2021 after December 31st of this year, into 2022 as well as 2023. And also potentially beyond after that as well.
Many businesses have received refunds, as well as others, in enhancement to reimbursements, also qualified to proceed receiving ERC in every payroll they process through December 31, 2021, at around 30% of their pay-roll expense.
Some services have received refunds from $100,000 to $6 million.
Do we still certify if we already took the PPP?
Yes. Under the Consolidated Appropriations Act, companies can currently get approved for the ERC also if they currently got a PPP car loan. Note, however, that the ERC will only apply to incomes not used for the PPP.
maintain a 20% decrease in gross receipts .
A federal government authority called for partial or full shutdown of your service during 2020 or 2021. This includes your operations being restricted by business, inability to travel or constraints of group conferences.
- Gross invoice reduction standards is different for 2020 and 2021, but is measured versus the current quarter as contrasted to 2019 pre-COVID quantities:
- A government authority called for full or partial closure of your company during 2020 or 2021. This includes your procedures being limited by commerce, lack of ability to take a trip or constraints of group conferences.
- Gross invoice decrease requirements is various for 2020 as well as 2021, yet is determined versus the current quarter as contrasted to 2019 pre-COVID amounts.
Do we still qualify if we continued to be open throughout the pandemic?
Yes. To qualify, your service has to meet either among the complying with standards:
- Experienced a decrease in gross invoices by 20%, or
- Had to alter business operations due to federal government orders
Several products are thought about as adjustments in company operations, including shifts in work roles and also the acquisition of additional safety equipment.