6 minute read
Is Your Business Missing Out on the Employee Retention Credit?
FINANCIAL GEMS
IS YOUR BUSINESS MISSING OUT ON THE EMPLOYEE RETENTION CREDIT?
Submitted by: Bruce J Legawiec, CPA/Partner, Osborne Rincon CPAs
Most businesses are aware of the Payroll Protection Program (PPP), which included a first draw in 2020 and a second draw in 2021. The PPP provided much needed assistance to many businesses suffering because of the COVID pandemic.
There is another government assistance program that can be of great value to a business impacted by COVID business restraints – the Employee Retention Credit (ERC).
Initially passed in 2020, a business receiving a PPP loan was not eligible to apply for ERC and this program was overlooked and infrequently used. Under the Consolidated Appropriations Act, a business may now take advantage of ERC for 2020 – even if it received PPP funds and the program is expanded to include 2021. For 2020, the credit is 50% of qualified employee wages paid between March 13, 2020 to December 31, 2020 up to $10,000 per employee (a potential credit of $5,000 per employee).
A business must demonstrate a decline in quarterly gross receipts in 2020 of 50% or more when compared to the same quarter of 2019; or it must have experienced a full or partial shutdown of its operations due to a government COVID restriction.
While the 50% gross receipts decline may be hard to meet, in California, many businesses were forced to close their doors or reduce capacity due to government regulation. For example, many restaurants were forced to restrict their operations to less than full capacity or only operate outdoor dining.
There is a catch: any wages used to apply for PPP loan forgiveness cannot be used to apply for ERC. This caveat makes accurate filing of PPP loan forgiveness application very important. Proper planning and allocation of wages for PPP loan forgiveness is critical to maximizing PPP forgiveness and ERC. The 2021 ERC is easier to qualify for. Like 2020, a business will qualify if it meets the government restriction test. The business shutdown can be full or partial.
If a business did not claim the ERC for 2020 it can amend payroll returns for 2020 and receive refunds – assuming it meets qualifications. In addition, there may even be an opportunity to revise a PPP forgiveness application claiming excessive wages that otherwise qualifies for ERC.
When a business has a full understanding of the interplay between PPP loan forgiveness and the Employee Retention Credit, it can properly allocate wages to result in 100% loan forgiveness and a substantial Employee Retention Credit.
Bruce Legawiec, CPA, is a partner with Osborne Rincon. Bruce has over 30 years of diverse public accounting experience, and is a graduate of Albright College. He has been a resident in the desert since 1979. Osborne Rincon is one of the oldest and most respected full-service accounting firms in the Coachella Valley. To learn more, go to www. OsborneRincon.com or call 760-777-9805.
NOW OPEN IN LA QUINTA
Submitted by: GCVCC Staff
COVID-19 has put a lot of things on hold in the past year, yet we have fortunately seen some businesses open and move to new spots here in the Gem of the Desert with more coming soon. We welcome these services, and encourage you to support local La Quinta businesses whenever possible. La Quinta Pet Hospital at Washington Park La Quinta Pet Hospital is a full-service, small animal veterinary hospital providing comprehensive medical, surgical and dental care within the central most intersection of the entire Coachella Valley. They believe the best bond between you and your pets starts with good health. At La Quinta Pet Hospital, every pet care plan is different, but all are focused on the same healthy outcome. They take a modern approach to pet wellness for long, healthy lives and offer the utmost in a calm, stress-free environment.
Dutch Bros at Jefferson Square
Founded in Southern Oregon in 1992 by dairy farmer brothers Dane and Travis Boersma, Dutch Bros Coffee is the country’s largest privately held, drive-thru coffee company. Having started from humble beginnings as a single espresso pushcart in the small town of Grants Pass, the company now has 400+ locations in Oregon, California, Washington, Idaho, Nevada, Colorado, New Mexico, Utah and Arizona. Dutch Bros Coffee serves specialty coffee drinks, smoothies, freezes, teas and its Dutch Bros Blue Rebel energy drink that customers can infuse with their favorite flavors. 78555 Highway 111, La Quinta, CA 92253 (760) 760-7000 LQPetHospital.com
Starbucks (across from City Hall)
The newest Starbucks to open in La Quinta is across from City Hall on Washington Street and includes a drive-thru. This larger location will replace the Starbucks at the corner of Washington Street and Calle Tampico. Starbucks is a Seattle-based coffeehouse chain known for its signature roasts, light bites and WiFi availability.
44-175 Jefferson St, La Quinta, CA 92253 (541) 955-4700 DutchBros.com
Garage Living on Highway 111
Garage Living is a premium, full-service company specializing in all aspects of garage improvements. The company transforms dirty, cluttered garages into clean, functional and organized spaces. Whether it’s in their showroom or in the comfort of your home, Garage Living’s team of design experts will provide you with a free consultation to evaluate your space and discuss a plan for your project.
78595 CA-111, Suite 100, La Quinta, CA 92253 (760) 989-4320 GarageLiving.com/PalmSprings/ 50951 Washington St, La Quinta, CA 92253 (760) 777-1554 Starbucks.com
Village Peddler (new location)
Previously Old Town Peddler, Village Peddler has moved just down the road in La Quinta and is now located near City Hall. Their goal is to help you experience some good old-fashioned fun whether it be renting bikes while on vacation or getting your own ride tuned up and road-ready.
50855 Washington St. #2D, La Quinta, CA 92253 (760) 777-7433 VillagePeddlerLQ.com
All information was gathered from the website and social media pages for each business. For more information about local businesses in La Quinta and how you can help support local, visit GCVCC.org or LaQuintaCA.gov.
Discover La Quinta Medical Center
At Desert Care Network’s La Quinta Medical Center Campus you’ll discover an intimate setting for hospital outpatient services. Our services include:
• Desert Regional Medical Center’s Comprehensive Cancer
Center satellite facility offers consultations, infusion services, and screening mammography • Desert Care Network’s Advanced Wound Healing Center offers care for chronic wounds, including diabetic foot ulcers. We are a member of the Amputation Prevention Centers of America. • La Quinta Imaging provides a wide array of medical imaging, including X-ray, CT and MRI scans • Our Neurology Specialty Clinic treats movement disorders, epilepsy and a host of neurological conditions • Desert Care Network Primary & Specialty Care, where patients can schedule appointments with physicians in a variety of primary and specialty services
La Quinta Medical Center | 47647 Caleo Bay Drive | La Quinta, CA 92253 DesertCareNetwork.com/LaQuinta
—C.S. Lewis
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