For a separate charge unrelated to your Total Accounting Care fee, the Stitely and Karstetter (S&K) team can meet with you to offer guidance on the requirements to qualify, as well as file your tax credit application.
Are you confused about Employee Retention Tax Credit? The S&K Tax Division Team can help. The government recently released additional guidance on the requirements to qualify under “Partial Shutdown” rules. This means more clients may qualify than under original rules. Even if your quarterly revenue increased from 2019 to 2020 and/or to 2021, you may still qualify under the new rules.
The IRS says if your business has suffered a *full or partial suspension* of operations in any calendar quarter in 2020 or 2021, then you may qualify.
What IRS deemed a partial suspension/shutdown has been less than clear in the past.
Currently, our federal friends define this as “more than a nominal portion of business operations are suspended by a governmental order.” They then define “nominal” in this new notice as less than 10% of either total gross receipts of the business operations or the total hours of service performed by all employees.
What does that mean for you? More businesses may have been indirectly impacted by a governmental order, although they continued to operate. It will depend on whether the portions of your business that were affected by a shutdown order make up more than the “nominal” portion of your business.
What should you do next?
1. If S&K evaluated your business in the past and you did not qualify based on revenue, but believe your business was impacted by shutdown orders, please contact S&K to re-evaluate.
2. If you did not think you qualified in the past, but based on this new information, you are not sure, let S&K evaluate this for you.
3. If you have questions and wonder if you will now qualify, give S&K a call or shoot them an email!
Here is a quick reminder on the credits:
1. Tax year 2020 – $5k credit per $10k wages per employee per year – Max $5k per employee for the year.
2. Tax year 2021 – $7k credit per $10k wages per employee per QUARTER – Max $28k per employee for the year.
We at Total Accounting Care, along with our friends at S&K, are here to help, as these credits are extremely complex and have many other rules to follow.
We are rapidly assisting clients with applying for these credits and look forward to speaking with you and seeing if your business may also benefit from this additional guidance. Contact us today: 703-802-2309.