With the world as we know it changing every day, we have been trying to stay on top of what's happening to help our clients and ourselves. We want to use this changing knowledge to protect our finances, our employees, to know if are eligible for assistance, and how to help our clients navigate through these strange times. Today we are going to be talking about Employee Retention Credit.
Hello, Summerville! We are so excited to see our beautiful town get back to some sense of normal. Everything about our daily and professional lives continues to change, but we are relieved to see that individuals and businesses continue to move forward. One of our main focuses these past two months has been how the current pandemic is affecting our finances. There has been a lot of help thanks to tax day being pushed back, the stimulus relief fund, and the CARES act. Each has seen its ups and downs for individuals and small businesses, bringing a mixture of relief and frustration.
Most of the financial help that we hear about day to day is that for personal finances, but businesses of all sizes have needed just as much help through these difficult times. Many have been required to operate at 50% capacity due to safety protocol during the pandemic while others have been completely shut down after they were deemed nonessential. With the signing of the stimulus relief package and the CARES act, businesses of all sizes were put into consideration. Small business loans and other forms of relief were immediately put into action, although their first big wave was not received well nor handled well.
Just like you as an individual, businesses have been on top of filing and working towards a way to help their companies survive so their employees have a place to come back to when this is all over. Most employers who were able to apply for any kind of assistance did so in March, but there are still opportunities and things to apply for if your company hasn't already. In this blog, we are going to be talking about one of these forms of assistance that is still available to businesses, and that is employee retention credit.
WHAT IS IT?
You may or may not be familiar with this term or what kind of help it provides. This is a business relief provision that encourages employers to keep employees on the payroll, even if they're not working. It helps provide relief to unemployment offices to limit the number of people applying for unemployment. It was also created to help guarantee that employers will have returning employees once they can open up again. Thanks to the creation of the employee retention credit, the government will reward your company for keeping your employees on your payroll and for deciding to choose this assistance. It is refundable tax credit taken against certain employment taxes that can equal up to fifty percent of an employee's wages that you, as an employer, are still providing. The tax credit is fifty percent of up to $10,000 in wages per employee that has continued to be paid by the employer. This means that your company can be awarded a $5000 tax credit per qualifying employee. This was created as a business relief provision. The money your company will be receiving is a refundable payroll tax credit for qualified wages that will be paid or have been paid to your employees between March 13th of this year until December 31st of 2020.
You and your company are eligible if you have been directly affected by COVID-19. If you have been forced to work at half capacity due to safety precautions, or you have been forced to shut down entirely because you are a nonessential business, you are eligible. No matter the size of your company, you are still eligible. Your company is eligible for this tax credit if your gross receipts for this current quarter are less than what they were in the same quarter this time last year. You are NOT eligible for this tax credit if you are a governmental employer, or if you are self-employed or a small business that has taken small business loans or other small business loans created to help with issues caused by the pandemic.
WHAT TO KNOW
Once you have decided to pick this type of relief, you can begin claiming it right away by reducing your payroll taxes sent to the IRS. If it ends up that your tax credits exceed your payroll taxes, you can ask for a refund directly from the IRS. If your company has over 100 employees, the only wages that can be obtained are of those who were full time and are not working right now. If you have under 100 employees, you can claim all of your employee's wages regardless if they are working or not. Wages up to $10,000 can be claimed, and this does include how much your company pays towards health insurance for each employee. Since you can claim 50% of this $10,000, the max credit you can receive is $5,000 per employee. The tax credit will be repaid to you after subtracting your share of your employee's social security taxes, and it will be treated like you overpaid your taxes, and it will be returned to you.
In comparison, the Paycheck Protection Program (PPP) was also created to offer similar benefits to businesses. You can't apply for both or receive benefits from both, you have to pick one or the other. When deciding which is best for you and your employees, always pick the aid that will help you and your employees the most, not one or the other. Since the applications for the PPP were suspended on April 17th of this year, this will now dictate your choice of what is available to you and your company. As the country slowly begins to reopen, pay close attention to how this will affect your business. You may be able to go back to work at full capacity, and you may not. There could potentially be more aid coming, we will just have to wait and see what the coming weeks will bring. If you and your company have been unable to receive any kind of benefits, keep your eyes open for this opportunity.
These have been difficult and confusing times. You aren't wrong in feeling overwhelmed and confused. We where are here to support you, Summerville. You are not alone in your fight. Also don't forget, if you're looking for the best tax accountant in Summerville, the best tax services in Summerville, the best Quickbooks services in Summerville, the best IT services in Summerville, and the best payroll services in Summerville, we are still here for you. Tax season may be over for some and just starting for others, and we will be here for you no matter what!
Even though the curve hasn't flattened as much as we'd like, and we've spent a lot of time focusing on staying safe at the moment, it's time to start thinking about the future. Your company is going to overcome all of this, and we are going to talk about how!
April was gone in a flash wasn't it, Summerville? Time has a very strange and unique way of passing. It's been hard keeping the days in order. Thankfully, working from home or with a small staff in our offices has helped us keep track. Can you believe that tax day came and went with so little attention this year? That's right! Tax day has officially been moved to July 15th! If you haven't paid and filed your taxes yet, that's ok! You still have time to do so. But, we do recommend filing your taxes sooner rather than later. This will help with refunds, getting your stimulus checks, and possibly speeding your small business loan applications up. Do what you can for your small business now to help your company in the coming months.
Although things are still unknown in the current market and our personal lives, it's time to start thinking ahead. We've spent our last few blogs sharing tips and suggestions on how to keep your employees safe, how the pandemic might affect your small business, the realities of your stimulus checks, but now it's time to start preparing for the beyond. It's a heavy truth that life as we've known it could be very different after all of this settles. But, we still want your company and the future of your company to be strong and prosperous. So, let's be hopeful and work towards that, together. As the best tax accountant in Summerville, we hope these tips and suggestions help you as we move forward in this very strange and uncharted time.
All of the financial help and small business loans that have been created and promises may or may not come through for your company. Some companies have received these benefits, while some might never see a cent of help. It's constantly changing, and we aren't sure what these new changes could or couldn't mean. We are following the news just as closely for these updates. Hang in there. This pandemic has affected every industry, and the best way to get through this is to stand strong and to support one another. We are here for you, Summerville. Take these tips to heart, they could help you in the long run.
We understand your concerns and worries. We hope this list inspires you to keep working and to keep your hopes up. We will get through this and will continue to work hard together. Also don't forget, if you're looking for the best tax accountant in Summerville, the best tax services in Summerville, the best Quickbooks services in Summerville, the best IT services in Summerville, and the best payroll services in Summerville, we are still here for you. Tax season may be over for some and just starting for others, and we will be here for you no matter what!
The coronavirus has changed the way we live our lives. It has changed our daily schedules, where and how we work, and has changed the face of education for our children. For parents working from home for the very first time while their children in school are also working from home, the landscape of living and working together has been altered. What does this mean for parents and their children and how can they be the most successful in these times of change?
So much has changed within the last few weeks since our last blog post about how small businesses and corporations need to operate during this time of crisis. It continues to change the work world so much, that we wanted to follow that blog up by discussing just how much COVID-19 is changing and affecting the lives of everyone in the working world down to the youngest of your family. One of the biggest reliefs and changes during this time is the 90-day deferment on taxes for everyone, allowing both individuals and corporations to pay and file their taxes on July 15th instead of April 15th. But, with that relief, comes a bit of a struggle. Many of us are working from home for the very first time and with children our children that are school-aged or younger. Going from the office to our home offices, kitchen tables, or couches has been a huge shift, especially if you're working alongside your son or daughter as they are virtually taking classes and sending in assignments in brand new ways themselves. Thankfully, you don't have to worry about your small business or corporation meeting tax deadlines for a few more months while you're getting adjusted. The biggest adjustment is working from home, being productive, and trying not to drive one another crazy!
As COVID-19 changes the guidelines on how to work, we wanted to break it down to the individuals affected by these huge changes and to share some tips and suggestions on how to successfully make this transition productive both to your company and to your well being. Without the latter, your work and productivity could suffer. So, let's get to work!
Every family, personal work space, and your job at hand is unique and different. Through this unknown time, you'll have to find what works best for you. These suggestions might be the perfect solution to your learning curve, or they might be the complete opposite. Take these as stepping stones, and continue to see what works for you and your family. In the end, whatever works for your family is the right way. There is no right or wrong way, there will just need to be a lot of trial and error until you reach a comfortable level of living. Hopefully, by then, life will be back to normal, or as close to it as possible!
One of the most consistent things we have seen to be successful for working parents and their children is to stay on schedule. The key is to create a schedule for this new way of living and to stick to it. This applies to both parent and child. All of this will depend on how old your child is and what their needs are, but living as consistently to your life before moving home is very important. Begin by waking up at the same time, get ready and dressed for the day, and eat breakfast at the same time. The temptation to sleep in, stay in the same PJs for days and eat whatever whenever is going to be a huge temptation. Don't fall into that trap! We aren't saying you need to get dressed to the nines or dress your children for picture day. The key is to change out of your PJs every morning and into another outfit that makes both you and your kids feel productive and normal as possible. Then, we recommend creating a schedule for your students for the whole day, not just during school hours. This will help them stay adjusted to their normal school day, stay on top of their expectations of getting homework done and studying completed, and allocate their free time. This way their grades don't drop while they are spending all of their time watching TV, playing video games, or on their phones. Keep them on a schedule that will create your workday too, one that allows you to stay close to your schedule too. For our parents with young children, keep them on a schedule as much as possible and one that is as close to what they have been living with. Take advantage of nap time, quiet playtime, and lunchtime as your work hours. You might need to get a little creative, and that's ok!
It will be very important to sit your family down and talk about what's happening in the world and what these changes mean for everyone. The situation will change expectations, free time, and it will also mean spending all of your time together during work and play hours. You will also need to communicate with your boss, employees, and colleagues that they might need to be more flexible because of your new work situation with your children. Express that your children could walk into a work call or video meeting at any time, and you might need to get up and leave to answer an emergency or a baby crying at any time. If anything, mention this often so it is never a surprise and not something that is forgotten by anyone. This is also the time to set boundaries with your kids. This might mean allowing them more TV, video game, and screen time to give you more space and time to get work done. If that is the case, explain to them that this extra free time is a treat and that everything will return to normal once work and school go back to their normal schedule. Set boundaries, especially for your school-aged children, and let them know when they can come into your work space, and when they can only come in when it is an absolute emergency.
During this crazy time, create a system that allows you to work and allows you to still be a family. Take breaks together from work and school to exercise together, take a car ride, or walk the dog together while still practicing social distancing. When work and school are over for the day, make sure they are over for the day. Separate work from play with the whole family, unless you have to finish a job or a project. Keeping regular dinner hours, family game or movie nights, and beyond are very important. Spending time together as a family is very needed. But, allotting yourself adult time is very important as well. It is also important to parent as a team and juggle these new schedule changes and learning curves together. Share the normal household tasks like you never have before. Switch places creating the daily schedule, serving as a teacher for the day, and even switch giving your partner the night off. Allow your partner to not have to worry about household chores or the necessary grocery trip if they're slammed with work, and let them repay the favor to you when you're swamped with work. You can even switch shifts throughout the day, whatever works for you!
This is an unknown time full of uncharted territory. Maintaining a sense of balance, normality, and regularity is the key to staying productive as a business owner and the head of a successful family. It may seem impossible at first, but keep working. You will figure out what works best for you. Remember to stay smart, keep following the WHO guidelines, and to wash your hands!
The tax season is getting closer and closer as we reach the holiday season. With the ending of the most wonderful time of the year, that also means the end of the last fiscal period of 2019. Are you ready or do you think you might need a little more time?
Happy November everyone! We hope you enjoyed our most recent blog about safe shopping tips for Black Friday and Cyber Monday! As we are still heading towards all of these wonderful holidays, there is still so much to think about. Taxes need to start making their way to the top of your priorities list. With the end of 2019 looming so close, tax season will be here before you know it. Are you ready for this next tax season or do you think you might need a little more time? There is no problem with needing that extra time - that's why tax extensions can be such a relief. Do you know the pros and cons of filing a tax extension? If you're new to the process, you've come to the right place. In this blog, we will be discussing the pros and cons, which will hopefully help you decide the best route for you before April 15 is here! To begin with, you file an extension request using the IRS form 4868. You fill it out and mail it right to the IRS.
There you have it! The pros and cons of filing a tax extension. If you have any more questions or need to talk with us, please don't hesitate to pick up the phone. We are here to answer all of your questions and get you ready for the next step in your taxes.
The Pathways Team