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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.
Since that's the things your CPA need to fret about, I am not going to get into the complexities of that form here or the Form 941 and all the payroll stuff. In this video I wish to tell you what you need to understand so you can go to your CPA and say, "Hey, what about this employee retention credit, why haven't you informed me about this?" You can be informed and take ownership of your own tax scenarios, of your company's tax scenario to generate more cash circulation in your organization and more wealth for yourself.
Solutions supplied can include:
Committed specialists that will certainly analyze extremely complex program guidelines and will be readily available to answer your questions, including:
What period does the program cover?
Mott Haven NY Employee Retention Credit 2021
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 big, a lot of small company owners do not learn about this, or they've heard about it, but they don't know much about it, even many tax specialists don't understand the ins and outs of this thing due to the fact that it's brand-new and a lot of these modifications
that are advantageous to service owners happened in the middle of tax season. In this video I'm going to dig into the employee retention credit, why it's so lucrative now in 2021, more profitable, far more rewarding, in fact now than it was in 2020, 5x more lucrative at least. So even if you do not own an organization, make sure to share this video with company owner you understand, this video could actually deserve tens of countless dollars for them. And if you are an entrepreneur and after you see this video you wish 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 email, [email protected], tell me a little about your company and your ballpark year-over-year income, and let's see if we can get some more refund in your pocket because you can take this credit against your payroll taxes you pay by lowering your needed 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. Since that's the things your CPA need to fret about, I am not going to get into the complexities of that form here or the Form 941 and all the payroll stuff. In this video I wish to tell you what you need to understand so you can go to your CPA and say, "Hey, what about this employee retention credit, why haven't you informed me about this?" You can be informed and take ownership of your own tax scenarios, of your company's tax scenario to generate more cash circulation in your organization and more wealth for yourself.
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About Employee Retention Credit 2021
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, before I get into this, I want to state that nothing in this video is to be taken as legal or tax suggestions, this video is for basic informative functions just, yes, I am a CPA and a tax expert, but I am not your CPA nor your tax professional unless you have actually engaged my firm. Another disclaimer here, for purposes of this video I am assuming that if you're enjoying this you are a small company owner, which for employee retention credit functions implies one hundred or fewer staff members for functions of the 2020 credit and 5 hundred or less staff members for functions of the 2021 credit, if you have a business with over five hundred employees I imagine you have in-house counsel, in-house CPAs who are on top of this things, however I'm here for you little business owners who might deal 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 organization that your tax expert hasn't had the time to go into the weeds here like I have.
Employee retention credit, why is it so rewarding for business owners in 2021 and why weren't we talking about it in 2020, it's been around because then, because the CARES Act? Yes, the employee retention credit has actually been around since the CARES Act that was passed over a year ago in March 2020, but the employee retention credit didn't get much love last year in 2020 since of the PPP, the Paycheck Protection Program.
However the stimulus bill passed in December, the Consolidated Appropriations Act, as well as the American Rescue Plan Act, passed in February 2021, made modifications to the ERC making it much more attractive. Essentially the employee retention credit had a glow-up between 2020 and 2021, it went from the nerdy girl with neglected eyebrows and thick glasses and her hair up in 2020 to the belle of the ball for business owners in 2021. Why? Why is the employee retention credit more attractive now thanks to the Consolidated Appropriations Act and the American Rescue Plan Act? I'll inform you why, a few reasons.
Why Employee Retention Credit 2021
Reason, the employee retention credit for both 2020 and 2021 is now readily available to PPP recipients, however of course you can't double dip. You can't get PPP for the hundred thousand dollars you paid your workers and then turn around and claim the employee retention credit on those incomes. The government does not look too fondly on paying your payroll for you through the PPP and after that you declaring a credit versus the taxes you pay the government on those incomes that the government spent for you. So that makes good sense. Now, there's some preparation here. If you got PPP and you are eligible for the employee retention credit, then when you do your PPP forgiveness application, you need to select the very best covered duration that will get you full PPP forgiveness but also optimize your employee retention credit.
For PPP forgiveness, you want to fill up that payroll container with as lots of expenses as possible that do not count for employee retention credit purposes. You can't claim the employee retention credit on state joblessness insurance coverage contributions, however state joblessness insurance contributions count towards PPP forgiveness, see? You 'd want to discard 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.
Another thing to note is you can't deduct the earnings you declared the employee retention credit on, and that makes sense as well, why should the government give you a reduction for these wages that they currently offered you a credit for? Alright, sorry for getting a little sidetracked there, I just enjoy talking about this stuff, 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.
In 2021, for a quarter to certify for the employee retention credit, you only need to show a 20% decrease in gross receipts compared to the same calendar quarter in 2019. So this means even more businesses will qualify. My business, for example, experienced a 26% decrease in gross invoices, comparing Q1 2019 to Q1 2021, and it was a comparable story in 2015 too.
I didn't certify for the 2020 employee retention credit first, because I got very first round of PPP cash and 2nd due to the fact that my organization didn't suffer that big 50% decrease required to qualify for the employee retention credit last year.But for 2021, at least for Q1, yeah, my service qualifies. Likewise, for 2021, for any quarter, you can elect to use the lookback quarter, indicating that, for instance, even if your Q1 2021 gross invoices aren't a minimum of 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 certify for Q1 2021 based on Q1 2021's gross invoices, you will also get approved for Q2 2021 because you qualified in the lookback quarter of Q1 2021.
Same thing for Q2 to Q3 and Q3 to Q4, so generally if you simply receive Q1 and Q3 2021, you also get approved for Q2 and Q4 based upon the lookback. Likewise, even if you didn't have a sufficient decline in income, you can certify for the employee retention credit if you were required to totally or partly suspend operations in your company throughout any calendar quarter in 2020 or 2021 due to state or federal orders, in which case you are eligible for the employee retention credit during that period of partial or full shutdown.
Common example, you own a dining establishment, and your governor signed an executive order mentioning that you need to shut down indoor dining. That is an example of a partial shutdown. Likewise, not only are more organizations eligible for the employee retention credit thanks to these brand-new laws, making PPP receivers qualified for the employee retention credit though not on the same salaries and making more companies eligible through the 20% decrease 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 due to the fact that for 2021, the credit is equivalent to 70% of qualified salaries per staff member paid from January 1, 2021 through December 31, 2021, limited to $10,000 in wages per staff member ... for that whole time duration? For 2021 the portion is more (70% in 2021 vs. 50% in 2020) and you can take it on up to $10,000 in earnings 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 maximum 2021 employee retention credit is $28,000 per worker.
If you got PPP and you are eligible for the employee retention credit, then when you do your PPP forgiveness application, you require to select the best covered period that will get you complete PPP forgiveness but also maximize your employee retention credit.
Alright, sorry for getting a little sidetracked there, I just love 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 easier to qualify for the employee retention credit in 2021. I didn't qualify for the 2020 employee retention credit first, due to the fact that I got first round of PPP cash and second because my business 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 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 wages and making more services eligible through the 20% decline threshold rather than the 50% decrease threshold, however the 2021 credit is also more profitable than the 2020 credit.
Not bad, but that's absolutely nothing compared to the 2021 credit since for 2021, the credit is equivalent to 70% of certified wages per employee paid from January 1, 2021 through December 31, 2021, limited to $10,000 in salaries per staff member ... for that whole time period?
How to Start
That will work out on part of their clients to get the finest rates possible for their existing customers. They will investigate old invoices for mistakes obtaining their customers refunds and also tax credits.
Solutions supplied can include:
Committed specialists that will certainly analyze extremely complex program guidelines and will be readily available to answer your questions, including:
Just how does the PPP loan element right into the ERC?
What are the differences between the 2020 and 2021 programs and also exactly how does it use to your service?
What are aggregation policies for bigger, multi-state employers, as well as exactly how do I interpret multiple states executive orders?
Exactly how do part-time, Union, and tipped workers influence the amount of my reimbursements?
Complete examination regarding your eligibility
Extensive evaluation of your claim
Guidance on the claiming procedure and also paperwork
Specific program proficiency that a routine CPA or pay-roll cpu could not be well-versed in
Quick and smooth end-to-end procedure, from qualification to declaring and also obtaining refunds
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| 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 Get Going? Its Simple.
1. Whichever firm you choose to work with will figure out whether your business qualifies for the ERC.
2. They will evaluate your case as well as compute the optimum quantity you can obtain.
3. Their team guides you through the claiming procedure, from beginning to end, including proper paperwork.
Frequently Asked Questions (FAQs)
What period does the program cover?
The program began on March 13th, 2020 and right on September 30, 2021, for qualified organizations.
You can use for reimbursements for 2020 and 2021 after December 31st of this year, into 2022 as well as 2023. As well as possibly beyond then too.
Many companies have received reimbursements, as well as others, along with reimbursements, additionally qualified to proceed getting ERC in every payroll they refine to December 31, 2021, at about 30% of their pay-roll expense.
Some services have obtained refunds from $100,000 to $6 million.
Do we still certify if we currently took the PPP?
Yes. Under the Consolidated Appropriations Act, services can now certify for the ERC even if they currently received a PPP financing. Note, though, that the ERC will just apply to salaries not utilized for the PPP.
sustain a 20% decrease in gross receipts .
A government authority required partial or complete shutdown of your company during 2020 or 2021. This includes your operations being limited by commerce, inability to take a trip or constraints of group meetings.
- Gross receipt decrease standards is different for 2020 as well as 2021, yet is measured versus the present quarter as compared to 2019 pre-COVID quantities:
- A government authority called for full or partial shutdown of your business throughout 2020 or 2021. This includes your procedures being limited by commerce, failure to travel or constraints of group conferences.
- Gross invoice reduction standards is different for 2020 and also 2021, yet is determined against 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 one of the adhering to standards:
- Experienced a decrease in gross receipts by 20%, or
- Needed to change organization operations because of government orders
Many products are thought about as adjustments in business operations, consisting of shifts in task duties as well as the acquisition of added safety equipment.