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The IRS has put a freeze on ERC refunds but that hasn’t stopped financing firms looking to capitalize on the popular pandemic-era tax break. Credit funds, small business lenders and ERC processing firms are all offering bridge loans and cash advances to small businesses waiting for their refunds. Such financing has gotten a boost after the IRS put a moratorium on the ERC program in September.
Persons: hasn’t Organizations: IRS, ERC
Ruth SimonRuth Simon is a New York-based reporter for The Wall Street Journal, where she covers small business and entrepreneurship. She has previously covered consumer lending, mortgages and housing, and reported for WSJ's Personal Journal and Money & Investing sections. Ms. Simon won a 2019 Best in Business Award from the Society of American Business Editors and Writers for her coverage of the impact of the labor squeeze on small business. She was part of a WSJ team that received a 2021 New York Press Club award for spot news coverage of the Paycheck Protection Program rollout. In 1995, she won the Award for Excellence in Financial Writing from the New York State Society of Certified Public Accountants.
Persons: Ruth Simon Ruth Simon, Simon, Gerald Loeb, Loeb, Organizations: Wall Street, Society of American Business, Writers, WSJ, New York Press, Money, Forbes Magazine, Distinguished Business, Financial, National Press Foundation, New York Newspaper Publishers Association, New York State Society of Certified Public Accountants, New York City, Society of Professional Journalists, Finance Locations: New York
With borrowing costs double their levels from just two years ago, many small businesses are pulling back, another sign of how higher interest rates are cooling the economy. Some entrepreneurs are postponing equipment purchases and expansion plans, while others are delaying hiring, rethinking loan terms or stepping up efforts to collect payments on time. Keeping borrowing costs in check and managing cash flow is an added challenge for business owners already dealing with labor shortages, inflation and economic uncertainty.
An IRS memo is the latest sign of the agency’s tough line in audits of the employee retention credit, or ERC. Photo: stefani reynolds/Agence France-Presse/Getty ImagesA lot of federal money is riding on what counts as a government order, and the Internal Revenue Service and tax firms are preparing for legal fights about that crucial definition. Employers can claim a pandemic-era tax credit worth up to $26,000 per worker if a government order fully or partially suspended their operations. Some employers and tax advisers say they can rely on Occupational Safety and Health Administration guidelines encouraging ventilation, physical distancing and other measures.
Persons: stefani reynolds Organizations: ERC, Agence France, Internal Revenue Service, Safety, Health
This copy is for your personal, non-commercial use only. Distribution and use of this material are governed by our Subscriber Agreement and by copyright law. For non-personal use or to order multiple copies, please contact Dow Jones Reprints at 1-800-843-0008 or visit www.djreprints.com. https://www.wsj.com/business/entrepreneurship/the-fight-against-diversity-programs-targets-small-business-aid-6afc3b4d
Persons: Dow Jones
The Stunning Boom and Bust of a Tax-Refund King
  + stars: | 2023-10-09 | by ( Ruth Simon | ) www.wsj.com   time to read: 1 min
This copy is for your personal, non-commercial use only. Distribution and use of this material are governed by our Subscriber Agreement and by copyright law. For non-personal use or to order multiple copies, please contact Dow Jones Reprints at 1-800-843-0008 or visit www.djreprints.com. https://www.wsj.com/business/entrepreneurship/the-stunning-boom-and-bust-of-a-tax-refund-king-416830b3
Persons: Dow Jones, 416830b3
This copy is for your personal, non-commercial use only. Distribution and use of this material are governed by our Subscriber Agreement and by copyright law. For non-personal use or to order multiple copies, please contact Dow Jones Reprints at 1-800-843-0008 or visit www.djreprints.com. https://www.wsj.com/us-news/irs-slows-refund-payments-for-pandemic-era-tax-break-54e80763
Persons: Dow Jones
This copy is for your personal, non-commercial use only. Distribution and use of this material are governed by our Subscriber Agreement and by copyright law. For non-personal use or to order multiple copies, please contact Dow Jones Reprints at 1-800-843-0008 or visit www.djreprints.com. https://www.wsj.com/business/entrepreneurship/inside-a-sales-army-turning-a-tax-break-into-a-modern-day-gold-rush-3741fa42
Persons: Dow Jones
This copy is for your personal, non-commercial use only. Distribution and use of this material are governed by our Subscriber Agreement and by copyright law. For non-personal use or to order multiple copies, please contact Dow Jones Reprints at 1-800-843-0008 or visit www.djreprints.com. https://www.wsj.com/articles/small-business-lending-is-about-to-change-with-simpler-requirements-8578a895
Persons: Dow Jones
This copy is for your personal, non-commercial use only. Distribution and use of this material are governed by our Subscriber Agreement and by copyright law. For non-personal use or to order multiple copies, please contact Dow Jones Reprints at 1-800-843-0008 or visit www.djreprints.com. https://www.wsj.com/articles/how-the-u-s-economy-is-sticking-the-soft-landing-cf140c04
Persons: Dow Jones
This copy is for your personal, non-commercial use only. Distribution and use of this material are governed by our Subscriber Agreement and by copyright law. For non-personal use or to order multiple copies, please contact Dow Jones Reprints at 1-800-843-0008 or visit www.djreprints.com. https://www.wsj.com/articles/the-math-problem-stymieing-small-businesses-in-rural-america-cc7cfa6f
Persons: Dow Jones
This copy is for your personal, non-commercial use only. Distribution and use of this material are governed by our Subscriber Agreement and by copyright law. For non-personal use or to order multiple copies, please contact Dow Jones Reprints at 1-800-843-0008 or visit www.djreprints.com. https://www.wsj.com/articles/new-borrowing-hurdles-leave-small-businesses-in-limbo-89cf1ea3
Persons: Dow Jones
This copy is for your personal, non-commercial use only. Distribution and use of this material are governed by our Subscriber Agreement and by copyright law. For non-personal use or to order multiple copies, please contact Dow Jones Reprints at 1-800-843-0008 or visit www.djreprints.com. https://www.wsj.com/articles/new-borrowing-hurdles-leave-small-businesses-in-limbo-89cf1ea3
Persons: Dow Jones
This copy is for your personal, non-commercial use only. Distribution and use of this material are governed by our Subscriber Agreement and by copyright law. For non-personal use or to order multiple copies, please contact Dow Jones Reprints at 1-800-843-0008 or visit www.djreprints.com. https://www.wsj.com/articles/the-pandemic-era-tax-break-keeping-the-irs-up-at-night-f139e439
A growing number of small businesses have hit the brakes on hiring. The portion of small-business owners who expect to expand their workforce over the next year was below 50% for the second month in a row in May, hitting the lowest level since June 2020, during the early months of the Covid-19 pandemic, according to a recent survey conducted for The Wall Street Journal.
A growing number of small businesses have hit the brakes on hiring. The portion of small-business owners who expect to expand their workforce over the next year was below 50% for the second month in a row in May, hitting the lowest level since June 2020, during the early months of the Covid-19 pandemic, according to a recent survey conducted for The Wall Street Journal.
A growing number of small businesses have hit the brakes on hiring. The portion of small-business owners who expect to expand their workforce over the next year was below 50% for the second month in a row in May, hitting the lowest level since June 2020, during the early months of the Covid-19 pandemic, according to a recent survey conducted for The Wall Street Journal.
Vesper Lounge is owned by Bonanno Concepts, which said it cut spending on Indeed by roughly 90%, largely because of the new pricing strategy. Photo: Joni SchrantzThe largest job-search site has run afoul of the small-business community. Indeed.com began changing how it charged employers for connecting them with job seekers, pitching the shift as better for small businesses because they could choose which applications to review and pay only for the ones they liked. Instead it created confusion and unexpected costs for many business owners, and now the company is trying to minimize the fallout.
Scott Anderson answered the doorbell one night in March to find his 8-year-old neighbor waiting with a bag of popcorn. Mr. Anderson, the chief executive officer of Zions Bank in Utah, had helped the boy open an account on his birthday last year. “Is my money safe?” the boy asked, Mr. Anderson said at an industry conference last week.
The collapse of Silicon Valley Bank and Signature Bank has created a new worry for many small businesses: what to do with their cash. Some owners of small and midsize businesses are moving funds to other institutions, splitting them between multiple banks, moving cash into money-market funds or buying Treasurys. Others are more closely reviewing the finances of their banks, while some entrepreneurs are even thinking about the potential risks for key partners and customers.
Small Businesses Find Some Relief From Hiring Woes
  + stars: | 2022-12-30 | by ( Ruth Simon | ) www.wsj.com   time to read: 1 min
Small-business owners say it is getting easier to hire workers and keep them around, in what they hope is a sign that the worst of their labor problems are behind them. The U.S. job market remains historically tight. But December marked the first time since July where more small-business owners said in a survey for The Wall Street Journal that they found it easier—rather than harder—to find workers.
Many small businesses that received federal pandemic aid are now on the hook for repayments, and some say the timing couldn’t be worse. WrightIMC, based in Allen, Texas, borrowed $150,000 from the Small Business Administration’s Covid-disaster loan program two years ago. The 20-person digital marketing agency made its first $1,600 loan payment this month, just as ad sales are softening.
Add rising interest rates to the challenges that small businesses are already grappling with, including inflation, labor shortages and strained supply chains. Some small businesses are cutting back on borrowing, paying down debt or delaying expansion plans as interest rates rise. Others worry that rising rates will boost prices charged by suppliers and crimp customer demand.
A temporary tax break for small businesses has spawned a cottage industry of advisory firms tapping into federal pandemic aid, raising alarms at the Internal Revenue Service that some claims are going beyond what the law allows. The Paycheck Protection Program and other federal aid programs long ago shut their doors. But small businesses and nonprofits battered by Covid-19 can still use a lesser-known lifeline, the employee-retention tax credit, or ERC. Businesses can claim up to $26,000 per employee in refunds by amending payroll tax returns from 2020 and 2021.
The economy is weakening, big companies from Ford Motor Co. to Facebook’s parent are cutting jobs or freezing hiring and inflation is eating into household budgets. Yet for many small-business owners, finding workers is as difficult as ever. The challenges are prompting some entrepreneurs to seek more creative ways to fill labor shortages at a time they might have expected hiring to get easier.
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