Online managed accounting by KPMG Spark helps you focus on your business. For the first time, small businesses have access to real-time dashboards, easy onboarding and a dedicated KPMG bookkeeping team.
Alex has over 7 years of experience in the financial services and consulting industries and oversees NEWITY’s Accounting Services group. Alex ensures each NEWITY member finds the best accounting solution for their unique business model.
David has over 12 years of experience, with extensive public and private sector business knowledge. David has a proven track record of effectively servicing his clients in matters of federal taxation and government incentives, particularly those in the start-up space.
Regardless of your company’s industry, you are likely eligible to claim the ERC. One exception is that governmental entities are ineligible.
Yes. There is a special form of the ERC that is specifically applicable to companies who began operations after February 15, 2020. These businesses are eligible to claim the ERC for Q3 2021 up to $50,000.
If the organization set one company-wide policy for consistency purposes (based on one jurisdiction’s particular restrictions), that order could be applicable across all locations as it relates to claiming the ERC.
It depends. ERC cannot be claimed on wages that were paid using PPP funds. However, if, for example, a company paid more wages than the actual PPP loan amount during the 24-week covered period, there is flexibility on how that PPP loan amount is allocated amongst applicable quarters.
Yes. The 2021 threshold for the decline in gross receipts is 20%, so this situation (a 25% decline) qualifies for the ERC.
You can apply for the R&D Tax Credit directly through your federal income tax return. This tax credit specifically offsets your company’s federal income tax liability. The ERC, on the other hand, offsets the employer’s share of the social security tax on your company’s payroll tax form (Form 941). Therefore, the two tax credits do not affect each other (i.e., file for the ERC ASAP, no need to wait for when you file your company’s federal income taxes).
This is false. The infrastructure bill signed into law in December 2021 repealed the ERC for Q4 2021, the IRS just has not updated their website for this guidance as of yet.
The IRS guidance is that this situation is in fact deemed a partial suspension of operations, and it creates ERC eligibility for the affected company.
Probably. On one hand, you are only able to allocate the funds across wages paid during the 8-week covered period rather than a 24-week covered period. However, this also means that your PPP covered period is shorter, and you potentially have more weeks to evaluate for ERC eligibility.
For simplicity’s sake, yes. For Q1, Q2, and Q3 of 2021, your business would be eligible for a maximum of $7,000 per employee per quarter (assuming full eligibility and no PPP overlap).
It is very unlikely that you will be eligible for ERC funds.
As long as the delays/cancellations were due to governmental orders, this scenario likely creates eligibility.
Determine all costs related to the furloughed employees’ health insurance, then determine a reasonable method to allocate those costs among the furloughed employees. This falls under the definition of “qualified wages” for the ERC.
Yes, this fact pattern likely grants eligibility due to several facets of the business being impacted at various times.
Currently this stands at between 6-9 months.
Yes, these are “box 5 wages” (on your federal incomes tax forms) – essentially, these are wages that are subject to Medicare tax (salaries, bonuses, etc.).
Possibly. This will depend on whether there is a governmental order that mandates a suspension related to a person testing positive.