Employee Retention Credit a Valuable Tool for Tampa and Miami Businesses

Employee Retention Credit

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.

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.

Form 941

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.

Difference between US Citizens and Green Card Holders

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.