Employee Retention Tax Credit Guide January 2023 Update

Employee Retention Tax Credit Guide January 2023 Update

The Employee Retention Tax Credit (ERTC aka the ERC) applicable to the Covid-19 pandemic has been evolving from its initial congressional act in March of 2020, was enhanced by the Consolidated Appropriations Act passed in January 2021, updated by the American Rescue Plan in March of 2021, and most recently updated by the Infrastructure Investment and Jobs Act.
If your head is spinning as you try to unravel the ERC rules, you are not alone. The ERC or Employee Retention Credit offers a viable and alternative way to recover payroll costs for any type of employer, except state and local government entities, regardless of their size.

Business Broker Fees and Other Business Sale Expenses

Business Broker Fees and Other Business Sale Expenses

When it comes to the sale of a business, there are a number of costs – both expected and unplanned – all business owners should understand before they agree to sell their business. A few of our Featured Advisors have weighed in, offering their expertise and perspective to explain the costs – from business broker fees and legal costs to hidden fees – as they relate to selling a business.

SBA Restaurant Revitalization Funding is Now Available

SBA Restaurant Revitalization Funding is Now Available

On Monday, May 3rd, 2021, the Small Business Administration (SBA) opened its application portal for the Restaurant Revitalization Funding (RRF) to certain restaurants, bars and other similar businesses that serve food and/or drink which have suffered a reduction in revenue in 2020 when compared to 2019 as a result of the pandemic.

Similar to the Paycheck Protection Program Loan (PPPL) program, this federally-funded program is intended to provide cash to businesses which have suffered revenue losses and if spent on the proper types of expenses within a specific period of time (the Covered Period), the loan may be fully-forgiven by the SBA.

SBA Expands PPP Loan Requests to Schedule C Filers

SBA Expands PPP Loan Requests to Schedule C Filers

Up until now, the PPP Loan proceeds for Schedule C filers was based on the 2019 net profit (referred to as the net earnings from self employment) plus payroll costs if employees worked in the business. The Interim Final Rule (IFR) effective on March 3, 2021 allows a business owner to use either their gross income or net income as the basis to compute its PPP Loan request amount.

4 Things To Do to Prepare to Sell Your Business

4 Things To Do to Prepare to Sell Your Business

What should a business owner do to prepare to sell his or her business some time in the near future?

Aside from right-sizing the business’s overhead costs to line up with its current level of revenue, and looking for opportunities the pandemic may be presenting, there are four things a business owner can do now to prepare to sell. And more importantly, doing these four things will mean that when a Letter of Intent is received from a buyer, the business will be very well-prepared to survive the due diligence stage of the sale.

What Happens to PPP Loan When Selling a Business

What Happens to PPP Loan When Selling a Business

The Small Business Administration (SBA) issued a Procedural Notice on October 2, 2020 which offers business owners and lenders guidance on how Paycheck Protection Program (PPP) Loans are to be handled when a business has a change in ownership.

This post summarizes the notice and includes an Infographic to assist business owners.  It includes the following topic:

When does a Business Sale Require the SBA’s Approval
Does a Business Sale Require the PPP Lender’s Approval or Notification
Required Steps Pre and Post-Closing for PPP Borrowers 
SBA Timeframe to Approve a Sale or Merger when a PPP Loan Transfers
Does the EIDL Grant Impose Additional Steps When Selling a Business

Disadvantages of Using A PEO

Disadvantages of Using A PEO

In a previous post, we discussed how a Professional Employer Organization (PEO) company works, its many benefits, and the tax implications you may face if you hire one.

As a recap, a PEO is a service that small or medium-sized businesses may use to outsource some of their human resource, payroll, benefits, taxes, recruiting, and other management tasks. As you might imagine, there are both pros and cons in hiring a PEO.

Here, we’ll discuss the disadvantages of using a PEO, along with the associated costs of a PEO.

SBA Reopens Economic Injury Disaster Loan Applications

SBA Reopens Economic Injury Disaster Loan Applications

On June 15, 2020, the Small Business Administration reopened the Economic Injury Disaster Loan (EIDL) applications to businesses with no more than 500 employees and non-profit organizations operating and suffering substantial economic injury as a result of the pandemic in all of the U.S. states, Washington D.C., and territories.
Independent Contractors, sole-proprietors (with or without employees), gig workers and freelancers are also eligible to apply for the EIDL.

7 Changes PPP Loan Flexibility Act Offers Business Owners

7 Changes PPP Loan Flexibility Act Offers Business Owners

On June 5, 2020, President Trump signed into law the Paycheck Protection Program Flexibility Act (PPPFA), which is the latest attempt to save struggling businesses from permanent shutdown.
The Flexibility Act offers business owners seven significant changes to the original Paycheck Protection Program (PPP) Loan terms. The House and Senate were driven to make these changes due to the lengthy pandemic and the fact that many PPP Loan recipients have not been able to re-open their doors for business during the required eight-week ‘covered period’ set forth in the original PPP Loan Act.
The PPP Loan Flexibility Act will make it much easier for business owners to achieve full, or nearly full, loan forgiveness.
The new law provides business owners with seven significant changes to the original law and those include:

Who is the Employer in a PEO?

Who is the Employer in a PEO?

Our PEO series is aimed at addressing the common questions about PEOs, and uncovering some of the lesser-known facts about working with a PEO so that you may make the best choices for your business. 

So far, we’ve learned about what a PEO company does. Here, we’ll dive into some muddy waters and decipher who is really the employer in a PEO relationship.

What is a PEO Company?

What is a PEO Company?

If you are wondering what a PEO is and whether or not this type of outsourcing may be a good option for your small or medium-sized business, this first article in our series of four posts will help you decide if it’s the right move for you.

In this post, we cover everything you need to know about a PEO company including:

• What’s the meaning of PEO?
• PEO payroll
• PEO benefits
• PEO tax implications, and more.

PPP Loans Out of Money — What To Do Now?

PPP Loans Out of Money — What To Do Now?

The Small Business Administration announced on Thursday, April 16th all federal funds set aside for the Paycheck Protection Plan (PPP) Loans have been allocated to those business owners who were persistent (and fortunate) enough to get through the application process and receive an official registration number from the SBA via its bank.
In simple terms, the PPP Loans are out of money to assist business owners.

How the Paycheck Protection Loans Work

How the Paycheck Protection Loans Work

On Friday, March 27, 2020, the Paycheck Protection (Loan) Program (PPL) for small businesses was approved as part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act. This new law is intended to help small business owners in an unprecedented way.
First, while the Paycheck Protection Program Loan will be initially set up by banks and approved by the SBA under section 7 (a), unlike other SBA loan programs, the PPL is guaranteed 100% by the SBA.
Second, if the proceeds of the loan are used by business owners as Congress, the Senate and President Trump intended, the loan will be forgiven.

ESOP as an Alternative Exit Strategy

ESOP as an Alternative Exit Strategy

When thinking about ways to sell your business, you are likely familiar with the most common strategies proposed by business advisors: selling to a third-party such as a private equity firm or a competitor, or selling to your family. What your business transition advisor may not have discussed with you is instead selling your business to an Employee Stock Ownership Plan (an “ESOP”).

Letter of Intent to Purchase a Business Guide

Letter of Intent to Purchase a Business Guide

If you’re considering the sale of your business, or possibly the acquisition of another competing business, it’s important to understand the selling/buying process.
An often overlooked and important first step during the process of buying or selling a business involves the negotiation of certain terms the buyer and seller will ultimately agree to at the closing table once the due diligence phase of the process is completed.
If either party ignores the importance of the initial terms’ negotiations, they can often end up with a bad deal or no deal at all.

How to Pay Yourself as a Business Owner

How to Pay Yourself as a Business Owner

In this post, I will be addressing how to pay yourself as a business owner and these related subjects:

Business owner compensation overview
Why does Reasonable Compensation of business owners matter
S-Corp Shareholder Employee compensation
C Corporation Shareholder Employee compensation
Distribution of Property & Cash to Other Shareholders
Taxes Applicable When a Business is Sold to a New S Corp or C Corp owner
Partnerships – Compensation, Distributions & Sale Proceeds Tax Consequences
Sole Proprietorships Compensation,Distributions & Sale Tax Consequences
LLC Member Compensation, Distributions & Sale Tax Consequences

How to Overcome Customer Concentration Objection When Selling a Business

How to Overcome Customer Concentration Objection When Selling a Business

One of the greatest risks any buyer faces is what will happen to the business’ best customers post-sale. Will the top customers celebrate the founder’s great accomplishment or maybe decide it’s a good opportunity to negotiate better pricing or payment terms with the new owner? Or worse yet, will they be spooked by the new owners and find an alternative vendor?

Astute buyers measure this risk quickly. Typically, one of the first questions experienced buyers ask the business broker is about the presence or lack of a customer concentration.

For the business owner considering the sale of his business in the near future, having a clear understanding if a customer concentration exists is vitally important. In fact, the lack of a customer concentration is a great selling point.

DBAs, Trademarks & Other Tools To Help You Protect Your Business

DBAs, Trademarks & Other Tools To Help You Protect Your Business

In this post we will be addressing how to protect your business name and whether filing for a DBA, registering a trademark or copyright, creating a URL, filing a patent application, and registering your business in your state of operation is appropriate, and most importantly why.

Understanding the differences between the various methods used to protect your intellectual property allows you to be prepared to make the best decisions possible for your new business. By doing so, the fence around your valuable business will be strengthened!

LLC vs S Corp

LLC vs S Corp

 Have a Question? Ask your question below and one of our Advisors will answer. Your business’s corporate structure will significantly impact a number of issues – including exposure to liability, financing and growth, the number of shareholders, the rate and manner in...
Deal Structure

Deal Structure

v Have a Question? Add it to the bottom of this post! In any business acquisition, a deal structure must be formed to specify the financial terms, conditions, and process for successfully completing the transaction. The deal structure outlines a set of terms that...
ESOP vs. 401K Plan – Definition and Benefits to Business Owners and Employees

ESOP vs. 401K Plan – Definition and Benefits to Business Owners and Employees

The method chosen to transfer ownership of a business for sale is one of the most important factors to consider as a business owner. And the reason for its importance is related to the wide differences in the amount of cash received (net of taxes) by the business owner across the various methods of transfer or sale. An ESOP or Employee Stock Ownership Plan is one method of ownership transfer or sale many business owners consider when they decide it’s time to retire. That said, let’s explore the ESOP as a potential method of transfer or sale from both the business owner’s and employees’ perspectives.

Raising Capital: Understanding the Options for Your Business

Raising Capital: Understanding the Options for Your Business

There are several types of loans available to business owners — so many, in fact, that the options can seem overwhelming and confusing, especially to smaller business owners without a lot of experience raising capital. This guide will help educate you on the options so you can make a more informed decision about financing your growing business while limiting added risk.

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