America’s Small Businesses Need a Boost; Let’s Not Discourage them from Seeking One

If you want to fire me up, ask me my feelings about American small- and midsized businesses (SMBs). I’ll tell you unequivocally that these businesses are the lifeblood of our economy. The source of millions of jobs. Generators of billions in tax revenue. Inspiration for some of our greatest inventions and technologies. Cornerstones of our hometowns and main streets.

And perpetually under the siege of uncertainty about what tomorrow brings.

Data from the U.S. Small Business Administration underscores how critical SMBs are to us as Americans.

• There are?33.2 million small businesses?in the US, comprising more than 99% of all US businesses
• Small businesses created?8.7 million new jobs?between March 2020 and March 2021
• Small businesses employ?61.7 million people?– about 46.4% of all US employees

And yet,?20% of small businesses fail in the first year, and nearly half fail in the first five years, according to the Bureau of Labor statistics.?

What a shame.

But this doesn’t have to be.

A few years back, I was visiting an entrepreneur friend in his office. I saw a stack of Treasury Department checks on his desk and asked why he had them. Turns out he had filed for and received research and development grant money for modifications he’d made in his small business the year before.

My curiosity was piqued. I wondered what other programs are available for SMBs and began a little research. It turns out both the federal government and state governments offer numerous programs to support small business.?

As someone who’s spent more than 30 years starting and running small businesses, I never knew the breadth of what was available to me or any other entrepreneur. These programs – while widely offered – are very narrowly publicized.

So inspired by my friend’s literal refunds for his business innovation, I decided to start Innovation Refunds, connecting SMBs with tax professionals who could help them cut through complicated grant and credit programs to gain access to money that would help them stay afloat or even thrive.

Then the pandemic hit, and SMBs struggled. Seeing this, Congress acted and passed the Coronavirus Aid Relief, and Economic Security Act (CARES) in April 2020. And the business I was nurturing became the perfect bridge between struggling SMBs and a financial lifeline called the Employee Retention Credit (ERC) program. In short, ERC reimburses portions of payroll taxes for eligible businesses of up to 500 employees who retained staff during the first six quarters of the pandemic.

Unfortunately, many SMBs were unaware of the ERC program. Others found it too daunting to apply. And still others were worried about being audited. I wanted to make sure Innovation Refunds could solve each of these problems.

Let me tell you how we have.

We’ve invested significant capital in advertising and marketing to solve the lack of awareness challenge. I am proud of our marketing program because it educates SMBs on ERC program details and eligibility.

We’ve applied a frictionless process to make it easier for SMBs to pursue ERC funding.?Now, a SMB owner need spend only a few minutes answering initial questions to determine whether they might be eligible for ERC money. We connect those who?might be?eligible with licensed tax professionals who help?them?smoothly get through the process. In other words, we make things less daunting.

And we have strategic partnerships with licensed tax attorneys and accountants who complete every application. What’s more, we offer audit protection to every customer, backing them if they are audited and have provided us with factual information for their applications.

We do it all without charging any money upfront. We don’t get paid until our customers receive a refund.

And we are just one of several companies – including at least three of the Big Four accounting firms, well-known payroll companies, credit rating companies and others – that are helping businesses access ERC. By our estimates, American SMBs may receive more than $90 billion collectively as a result of the ERC program. If so, that’s enough to sustain 1.3 million jobs.

Imagine the impact this program has already had on countless businesses on Main Streets across America – from auto shops and restaurants to nursing homes and dentist offices, and more.

I told you: This stuff fires me up!

The IRS has warned potential ERC recipients to think twice before applying for ERC. They argue that SMBs need to be on the lookout for bad actors who aggressively market services or make outsized promises about what individual businesses might receive. This is true and it is wise advice, but I worry that this rhetoric will discourage countless eligible businesses who desperately need the help applying.

I hear the IRS, and I agree with them to look for a professional in the space who acts with integrity. I am proud to say, following a rigorous, independent third-party audit process, Innovation Refunds is compliant with the American Institute of Certified Public Accountants (AICPA) Systems Organization and Controls 2 (SOC 2) standard. This relates to how we manage and store data across five criteria: security, availability, processing, integrity, and confidentiality.

If you own an SMB, let me leave you with one very important message here: Do your homework. Research whether you might be eligible for ERC funds (or any other government programs that could help you thrive). Work with a partner who relies on licensed tax attorneys, accountants and other tax pros to go through the process.

And claim funds for which you are eligible from programs that were created specifically to aid small businesses – the lifeblood of the American economy!