Link To Guest Website: Dominion Enterprise Services
Title: “Tax Credits Available For Business Owners”
Guests: Catherine Tindall & Skyler Kressin – Dominion Enterprise Services
Interviewers: Jeffrey Davis – MAGE LLC & Evan Macedo – Sapers & Wallack
Click here to read the transcript
Hello, everybody. Welcome back to radio entrepreneurs. My name is Jeffrey Davis and we continue to stream stories of entrepreneurship and leadership in this chaotic economy. This is a special segment F E I financial executives international. That means my co-host is the one and the only Evan Macedo of Sapers & Wallack with a little bit of a raspy voice. Welcome Evan.
Good morning, Jeffrey. It’s a pleasure to be here. And I know we have a wonderful show in store for us today, so very excited to get into it.
I’m glad I could hear your voice. I thought this was going to be the code of segment. Then you’re going to be doing signings, but I guess not. So we will try to skip our, our guests today are Catherine Tindall and Skyler Kressin partners at dominion enterprise services. Welcome.
Thank you. Thanks for having us.
Thanks for having us.
Well, I know dominion is very busy during this COVID time. And why don’t you tell us a little bit about your services?
Skyler (1m 3s):
Sure. We are a tax advisory and a credit specialty firm that deals primarily with entrepreneurs, startups, business enterprises, closely to help help family enterprises. And we deal primarily in the realms of tax strategy consulting. And right now we’re really focused on a couple of COVID related tax credits. One of them is the employee retention credit, and then we’re also on an ongoing basis helping particularly startups and innovative businesses with the R and D tax credit.
Evan (1m 40s):
Great. In Schuyler, I know you guys do a lot of work. I know I’ve personally talked to you about the employee retention credit for our company. Do you guys, just for our listeners out there, do you mind giving a, a broad overview of what the employee retention credit is, how much you might be able to get and who might be eligible for it?
Jeffrey (1m 58s):
Skyler (1m 60s):
Yeah, absolutely. So this is one of those credits that was part of the incentive packages that were passed as part of the legislation that occurred during the pandemic. And really what it is, is it’s a, a tax credit that is claimed on your payroll tax returns or on amended payroll tax returns. So unlike some of the other programs that are loans like the PPP loans that many people are familiar with, it is a tax credit. So does a claim that you make on a payroll tax return, that is a refundable credit. That basically is a check written from the IRS to you. And the amount that you can claim is up to $26,000 per employee for the period of the pandemic, which basically ranged from the second quarter of 2020 all the way through 2021, in some cases, in some areas,
Evan (2m 56s):
Well, that’s, that’s a pretty big $26,000 per I imagine if you have, I don’t know, a hundred employees that credit can add up pretty quickly over there.
Skyler (3m 6s):
Absolutely. And that’s not to say that everybody qualifies for that full amount, many, many don’t, but in the best case scenario, that’s the amount that you can qualify for. There are other complications to this and calculations interactions with other, other things like the PPP, but in the best case scenario, it’s a very attractive incentive here.
Jeffrey (3m 25s):
And, you know, a lot of people might wonder, they might think, oh, my business is too small. Is that a fair assessment? Or, you know, can you respond to that?
Skyler (3m 35s):
Sure, really the only requirement that you need to have is you need to have employees. And so if you’re a, for instance, a sole proprietor that does not pay wages out, that’s not gonna work. If you just kind of, you know, making profits based on your own labor, et cetera, and you pay 10 90 nines, you know, contractors, or what have you, that’s not going to work, but if you do have employees, you can potentially qualify for, even if you say, have a small shop with five employees, you can still qualify for this credit.
Evan (4m 4s):
And Catherine, I want to ask you, do you guys, what do you guys do in terms of helping to see if somebody actually qualifies for this credit and what if they ever get audited? Do you provide any sort of audit support? How does that work?
Catherine (4m 19s):
Yeah, so basically because we’re a specialty CPA firm, we do a lot of work for other CPA firms. So for people where maybe they, their tax practitioner doesn’t do this kind of work, we come in and just as part of our exploration process, we’ll do a rough calculation of what, what your company would be eligible for. And if you’re eligible and you know, the rough amount of the credit. And then also we take care to explain, you know, how the credit interacts with other things that are going on in your income tax situation, because it does, you know, like anything in the tax code it’s not straightforward. So that’s part of just our process. We do initially, just so that before you make a decision like this, you have all the, you know, the facts in front of you of what’s going to happen.
Catherine (5m 2s):
And then on the backend, like I said, because we’re a CPA firm, you know, we’re able to represent clients before the IRS. And so that ends up being a, that ends up being a, a big part of the service that we provide because with these crazy claims, because it’s such high dollar figures, you know, we’re expecting a lot of IRS activity in the future around them.
Evan (5m 24s):
Well, that’s fantastic. And I, I know we wanted to move on to the research and development credit as well, since we still have a little more time for our show here, do you guys want to give us a brief overview of what the R and D credit is and who might be eligible for that?
Skyler (5m 41s):
Sure. I can take that. So the R and D credit is something that was enacted back in the early nineties and really what it was, was a incentive for domestic enterprises to basically innovate and to pay people to innovate. And so what has been incentivizing this entire time? And it was, it was made more powerful and more permanent back in 2016 is it’s been incentivizing companies that pay employees to do technical work related to the development of a new product or process within their enterprise. And so it has to be their own property, their own intellectual property, the own physical property, their own designs.
Skyler (6m 23s):
It can’t be something that they’re doing as custom work for someone else, but if they pay employees or contractors to develop a new product or process within their enterprise, then they are potentially eligible for the credit. And the more you pay as a, as a proportion of your wages or subcontractor costs in relation to the development of new product or process, the more you’re going to benefit from this credit.
Evan (6m 48s):
Hmm. And Skyler, I know you and I are writing a blog together, which should be coming out in a couple of weeks, probably around the same time this radio show will come out. But I wanted to ask you at what point, what, like what’s the dollar figure that somebody will spend on an R and D product where it makes sense to give you guys a call and start looking into this credit?
Skyler (7m 10s):
Yeah. I would say if you, if you spend somewhere around, let’s say two to $300,000 in it, on an annual basis in wages or subcontractor costs towards the development of a new product or process, then, then yeah. It’s, it’s worth looking at. And so that a lot of times, you know, you’ll find startups where, you know, they have low payroll, but then as they, as they ramp up, they start having high payroll. And even though they’re still in a loss state, they can still take advantage of the credit by carrying it forward, or they can offset payroll tax or what have you. But I would say at that threshold, that really makes a lot of sense.
Evan (7m 48s):
Jeffrey (7m 50s):
We’ve been speaking with Catherine Tyndall and Skyler Cresson partners at dominion enterprise services with Evan, Macedo of Sapers and Wallach all very important tax credits during this time. I think learning how to optimize our situation. I know the R and D tax credits are something that a lot of my clients over the years have taken advantage of, and it’s really helped them during different and various times, Catherine and Skylar, if someone’s looking for dominion enterprise services or wants to know more about what you do, how would they find you?
Catherine (8m 23s):
You can visit us online. Our website is dominion E s.com and we’re both fairly active on LinkedIn. So we often post different interviews and different things that we’re up to on LinkedIn. So feel welcome to connect through there as well.
Jeffrey (8m 38s):
Great. Do you want to add anything to that Skyler or no? You that captures it all
Skyler (8m 44s):
Pretty much captured, is it at all? I would just say as a final note, this employee retention credit is a time-sensitive thing. We have basically till April of 2023 to claim these. And so don’t miss your opportunity to claim these six figure plus credits for your company in this short timeframe.
Jeffrey (9m 2s):
It’s there. You might as well take it.
Skyler (9m 4s):
Jeffrey (9m 5s):
And Evan Macedo from Sabres and Wallach, and also our FEI representative. You want to give us the connection for both organizations?
Evan (9m 12s):
Absolutely. I’ll start with sabers and wallet. So we have a brand new website. If you go to Cypress hyphen wallet.com, you can check us out there. We have our team page where you can contact myself or anybody else at the company. We also have built out a very extensive learning center with all kinds of articles and blogs and podcasts and videos on all kinds of different financial service topics. So I really ask you to go check that out. And then this is an FBI segment. FBI is financial executives international. So I’m part of the Boston chapter. We have over 450 members and growing, and it is a great networking group. If you want to be around other peers who aren’t senior financial leaders in your area, you can check them out at FBI, boston.org.
Jeffrey (9m 59s):
Oh, great. And that new website for staples and wallet, do they have your full picture on the homepage?
Evan (10m 5s):
Oh, they do Jeffrey. So he can look at me all day.
Jeffrey (10m 9s):
What more would have what I want, remind everybody. My name is Jeffrey Davis, radio entrepreneurs, also Meiji, LLC. I want to thank our guests and for being on the show today and remind everyone, this is radio entrepren.
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