IRS Archives | SDG Accountants

Employee Retention Credit a Valuable Tool for Tampa and Miami Businesses

21 Feb 2023
SDG Accountants
Accounting, Tax
Comments Off on Employee Retention Credit a Valuable Tool for Tampa and Miami Businesses

The Employee Retention Credit (ERC) is a tax credit that has been a valuable tool for businesses in Tampa and Miami during the COVID-19 pandemic. The ERC was introduced in the CARES Act (Coronavirus Aid, Relief, and Economic Security Act) in March 2020. It was designed to help businesses keep their employees on payroll during the pandemic. The credit has since been extended and expanded under subsequent legislation, making it a valuable tool for businesses seeking to retain their employees and navigate the challenges of the pandemic.

The ERC is available to eligible employers that experienced a significant decline in gross receipts or were fully or partially suspended due to government orders related to the COVID-19 pandemic. Eligible employers can claim a tax credit of up to 70% of the qualified wages paid to their employees, up to a maximum of $10,000 per employee per quarter.

Free up your time to focus on what matters.

Growing your business.

BOOK NOW

For businesses in Tampa and Miami, the ERC can be especially valuable. The pandemic has hit these two cities hard, with many businesses struggling to stay afloat. The ERC can help businesses in these cities to retain their employees and keep their doors open. The credit can provide much-needed relief to businesses that are facing financial challenges due to the pandemic.

To claim the ERC, eligible employers must file Form 941, Employer’s Quarterly Federal Tax Return, with the IRS. The credit is claimed on Line 11c of the form. Employers can also claim the credit in advance by reducing federal employment tax deposits.

It’s important to note that there are some restrictions and limitations on the ERC. For example, employers that receive a Paycheck Protection Program (PPP) loan may not be eligible for the ERC for the same wages. However, businesses that have already received a PPP loan can still claim the ERC for wages that are not covered by the loan.

In Conclusion

The Employee Retention Credit is a valuable tool for businesses in Tampa and Miami that are struggling during the COVID-19 pandemic. Credit can help businesses to retain their employees and keep their doors open during this challenging time. If you are a business owner in Tampa or Miami, it’s worth exploring whether you are eligible for the ERC and how you can claim the credit. By taking advantage of this tax credit, you can help your business to weather the storm and emerge stronger on the other side.

Book A Consultation

Difference between US Citizens and Green Card Holders

09 Oct 2018
SDG Accountants
Tax
Comments Off on Difference between US Citizens and Green Card Holders

What is the Difference between US Citizens and Green Card Holders When it Comes to Taxes?

When it comes to filing federal taxes, there is pretty much no difference in tax compliance. Even though you may be classified differently for immigration law purposes, Green Card Holders are considered US tax residents – just like US citizens. So the rule of US citizens being taxed on their global income applies to Green Card Holders. But you shouldn’t worry about unequal tax differences because you may be able to take advantage of tax breaks such as the Foreign Earned Income Exclusion and the Foreign Tax Credits.

The tricky aspect of being a Green Card Holder is when it comes to tax treaty positions. Green Card Holders can use tax treaty positions to lower their overall tax burden, however, only a lawyer would be able to fully analyze a tax treaty position for you.

Does a Green Card Holder Need to Pay Tax to the US and Their Home Country?

Maybe. As previously stated, a Green Card Holder must report income earned from anywhere in the world to the IRS. However, there are many countries that have a tax treaty with the U.S. that will allow the Green Card Holder to offset their taxable income. This generally means that you still have to file two tax returns (US return and foreign home country return). For example, if Jacob is living and working in Toronto, Canada but is a Green Card Holder, he must file both a U.S. Form 1040 and Canadian Form T1. Assuming he can pass the Physical Presence Test, he may be eligible for the Foreign Earned Income Exclusion and may be able to shield all of his income from U.S. taxes. Even though he will only have to pay taxes to Canada and none to the U.S., he must still file returns with both countries.

What about FBAR (FinCEN 114) for a Green Card Holder?

Since Green Card Holders are considered U.S. tax residents (even though they may be classified differently for immigration purposes) they are required to file the FBAR if applicable, as well as FATCA reporting.

FBAR Compliance

07 Oct 2018
SDG Accountants
Accounting, Tax
Comments Off on FBAR Compliance

What Is FBAR Filing?

FBAR stands for Report of Foreign Bank and Financial Accounts. It is a filing requirement for certain U.S. persons that meet two specific criterions. The first one is that they have an interest or authority over a foreign account/(s). The second one is that the account/(s) have an aggregate value of more than $10,000. There is a fairly long list of exceptions that applies to certain situations where FBAR filing is unnecessary. Some of the most common ones include accounts:

Owned by governments;
Owned by a U.S. military facility;
Held in retirement plans;
Held as a part of a trust where the taxpayer is the beneficiary.

In addition, FBAR and all related tax evasion penalties do not apply to you if your spouse already filed. The reason why is that the FBAR filing rules for married couples oblige them to put everything on one form.

When Is the Foreign Bank Account Reporting (FBAR) Due?

Anybody who has a foreign bank account (or multiple bank accounts) that have an aggregate of more than $10,000 must file an FBAR. The $10,000 threshold is in US dollars – foreign currency should be converted to US dollars. If you are required to file the FBAR, you will file it with the Financial Crimes Enforcement Network (or “FinCEN”). The return was formerly known as the You do not file the FBAR with the IRS or with your tax return. It is a separate filing. The 2018 extended due date is October 15, 2018.

What about the Foreign Account Tax Compliance Act (FATCA) Form 8938?

The FATCA Form 8938 is not limited to only expats. It applies to all US citizens. Expats generally have to file Form 8938 if they have $50,000 or more in total foreign assets at year-end or $70,000 at any point throughout the year. The thresholds are higher for taxpayers who are married.

Is it True That the Offshore Voluntary Disclosure Program is Ending?

The OVDP is a program offered by the IRS that allows the taxpayer to come into tax compliance by making various foreign assets reporting in exchange for a promise to not be criminally prosecuted. OVDP really only applies to those who were willfully hiding money – meaning they were actively trying to conceal their foreign assets. However, the IRS recently announced that they will be ending the Offshore Voluntary Disclosure Program on September 28, 2018. If you failed to make the necessary foreign asset disclosures but weren’t trying to actively hide our foreign assets, you may be eligible for the Streamlined Filing Procedure. This procedure allows you to report foreign assets without fear of tax penalties being assessed.