Payroll Vault Helps Recoup Millions in Tax Credits for Local Small Businesses
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Payroll Vault Helps Recoup Millions in Tax Credits for Local Small Businesses

Many Businesses May be Eligible for Government Support

October 24, 2022 // // LITTLETON, Colo. - The COVID-19 pandemic resulted in many companies needing to put employees on furlough or let them go altogether, but payroll and human resources service franchise Payroll Vault has helped qualifying businesses receive millions of dollars in tax credits for sticking by their staff through the recent period of economic hardship.

The federal government established a variety of financial assistance efforts through the CARES Act, including the Employee Retention Tax Credit (ERTC). This tax credit is available to employers who retained staff during the entirety of 2020 and the first three quarters of 2021. According to the IRS website, the purpose of the ERTC is to encourage businesses to keep their employees on their payroll. The refundable tax credit is 50% of up to $10,000 in wages paid by an eligible employer whose business has been financially impacted by COVID-19.

Due to lockdowns, social distancing, and occupancy restrictions during the height of the pandemic, many businesses lost revenue, some closing, reducing their footprints, or needing to cut costs wherever possible. Through the ERTC, those businesses that remained open have an opportunity to recoup some of the losses they faced while they continued to provide for their customers and their staff.

Local Payroll Vault owners have been instrumental in helping as many local businesses as they can apply for ERTC.

One example is Payroll Vault owner Ajay Saini of Pleasanton, California. When a local certified public accountant approached Saini’s office with a list of clients in various industries, Saini and his team took on the task of evaluating each client’s business and helping them apply for ERTC payments.

“The clients are very grateful that they received these credits,” Saini said. “The last couple of years have been extremely tough for businesses, especially small businesses. A lot of them have worked very hard. They continued to serve their customers and, in turn, help their employees have a job and support their families.”

Payroll Vault Payroll Relations Representative Tom Venturini, East Dundee, Illinois, in Chicagoland, said he believes Payroll Vault was among the first in their area to begin calculating and processing ERTC applications for local business owners.

“We’ve provided ERTC assistance to over 200 clients so far,” Venturini said. “Our quick response enabled us to generate a lot of referrals outside our customer base, which led to new payroll customers.”

According to Saini, any business in any industry may be eligible for ERTC if they saw a decline in revenue and/or if they were partially closed due to government order from March 13, 2020, through the first three quarters of 2021. To determine if there was a decline in revenue, a business’s revenue from a given quarter during the above timeframe is compared to the revenue made during the same quarter in 2019. If the business meets these parameters and the remaining requirements, it may qualify for ERTC.

Saini said some business owners have expressed concern about being ineligible for ERTC if they received money from the federal payroll protection plan (PPP). Fortunately for these business owners, that’s not the case, although any PPP payments received must be reported and deducted from ERTC payments.

“You can’t double dip,” Saini said. “Also, family members aren’t eligible (for ERTC). If you’re paying a spouse or child, you can’t count that.”

Even with these deductions, a business may qualify for ERTC from a few thousand dollars to several hundred thousand or even several million, depending on the size of the company and type of operation. Saini said this credit is very significant to business owners, and it’s important for them to see if they’re eligible, a task that payroll experts like those at Payroll Vault can help with.

“If they are eligible, they should apply,” Saini said. Otherwise, it’s like leaving money on the table. The government is rewarding them for working hard during the pandemic, but the laws kept changing during the pandemic. That’s why it is good to work with a professional (payroll expert), have a conversation with them, and for a professional company to update their payroll information and evaluate it.”

SOURCE Payroll Vault



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