Lets talk first about Aggregation Rules For Employee Retention Credit :
Our team here what do these men doing everybody in this space is assisting teach people about ERC and uh always offer a stunning breakfast and have people truly learn about the program we need to head to the room where we are able to show a few of the checks that we are getting for business and I wish to see that what is this this is uh hundreds of millions of dollars literally Kevin numerous countless dollars so these are replicate copies of the letters that go to customers validating that the check is on the method I suggest you know if you just begin to look at a few of these here I indicate this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I imply it’s just I imply think about how many actual clients that went through the program yeah this is the very end this is the celebration at the end when the check is verified the numbers are verified and the check is on the mail in the mail from the internal revenue service heading to the client so that’s how you’re able to track it you know when you
get this you understand the check is chosen sure and that’s when they pay so they do not pay anything up until they in fact receive the cash they don’t pay bottom line Wonder trust anything till this letter is verified the check is on the method they deposit it into their savings account and they can truly rely on Wonder trust that the process has actually been finished and how many you think you have actually processed because you started this we’re about 35 000 of these for
about 6 billion dollars wow so plainly they understand what they’re doing and that’s what you need you require experts on the other end of the phone to process this and get it to where you get among these that’s what matters all right Mr Fantastic here you’re at my YouTube channel we’re speaking about something really crucial today the staff member retention credit which most of you have never ever heard of I certainly had not become aware of it until really just recently and found out a lot about it because this is probably the most affordable expense of capital for any small company anywhere
anytime if you have staff members between five and five hundred so I’ve got the professional with me this is Josh Fox he’s the creator and CEO of bottom line Ideas they’re the biggest processor of these ERC credits this is a 170 page program so it’s hard this isn’t like PPP we simply contact your bank supervisor and state offer me a loan it doesn’t work there’s not a loan it’s an application and Josh is going to inform all of us about it and how to get it and why I have actually ended up being yes the Ambassador and paid representative for this I enjoy this program it’s going away soon you got to find out everything about it let’s talk employee retention credit Josh Fox what is an ERC let’s just start there so throughout the Trump Administration when President Trump was enacted they created the cares Act and the cares act used companies 3 opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and almost everyone it makes a huge distinction right there two of them are loans and one’s a refund exactly so the ERC is a refund that’s.
fix the cash cash payroll tax refund alright go on sorry I just have to ensure we got that point I suggest that’s a huge distinction a loan versus money cash I like cash cash that’s what we’re discussing fine and the other loans are done so we’re sitting here in 2023 and the eidl is over the PPP is over and the only one left from the original cares Act is the ERC and yes Kevin it is a lovely hard check in the mail where you get real cash from the IRS all right so let’s discuss how it works due to the fact that it sounds like to me if it’s a if it’s worker retention credit that individual had to be a worker so I’m going to make the Assumption this cash is not for the owner not for people on the cap table not for investors it’s for workers right you had to have owned a business but it’s based upon you having W-2 staff members in America not 10.99. so as long as you had W-2 employees and you paid federal payroll taxes that’s why you would be eligible so you need to be on payroll in 2020 on the W-2 and you have to be on payroll for the first 6 months of 2021 on the W-2 right so there were six quarters the program was open well stroll us through the six quarters so you had quarters 2 3 and four of 2020 and you had quarters one 2 and three of 2021. alright so that’s how it’s determined you need to be on the W-2 throughout that duration now let’s talk my preferred part cash how much can you get back per worker that was on a W-2 in those 6 quarters so the calculation in 2020 to be specific Kevin is 50 of the worker’s salary to an optimum of 5 thousand dollars per worker for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the staff member’s wage to a maximum of seven thousand per quarter how did that happen um they simply altered the rules in.
2021 versus since the mayhem of the pandemic so they wanted to even get more to keep those staff members on payroll 100 so if you can get 5 000 per person Max in twenty that was 50 in 2020 up to five thousand Max and then what occurs 21 000 Max in 2021 oh that’s how you come up with twenty six thousand twenty one thousand to twenty twenty one plus five thousand in twenty twenty that’s twenty six thousand dollars per employee that is since that’s a lot of money it is now there’s a caveat here the PPP cash would need to be lowered from the twenty six thousand dollars so if you took PPP loan one and PPP loan two you would reduce the 26 000 so what we’re seeing usually Kevin is if you took PPP cash someplace around 10 thousand dollars an individual so let’s say hypothetically you owned a dining establishment in New York City where I’m from and you had a hundred employees and you took PPP cash you would still get a million dollar in the mail from the IRS so it’s big certainly now the big concern is why does nobody learn about this due to the fact that look when I first heard about this when I initially fulfilled Josh you know I have actually got great deals of investments in great deals of companies I’m a significant supporter for entrepreneurship in America and make numerous many investments in business owners of which many suffered through the pandemic when I initially found out about this I called BS I don’t believe it due to the fact that I utilize the PPP we went through the cash center Banks to get it it was very easy to do we had our CEOs call the banks they got their loans and that were well should have and we used them carefully to survive throughout the pandemic so when I became aware of this I stated nah it can’t be true but when I dug around I even called to my politician pals Guv Senators they didn’t learn about it I suggest that’s how you understand that’s how misinformation is that there’s no information out there then a lot of people told me well you can’t get it due to the fact that you took the PPP likewise not real so let’s ask Josh why does no one understand about the worker retention credit you understand what’s intriguing you’re discussing the banks Kevin due to the fact that in the PPP loan procedure the federal government made it very clear that if you wanted a PPP loan you would call Wells Fargo Citibank Bank of America any of the huge banks in our nation and they would process procedure in Canada a pre-pp loan there’s no loans in Canada by the way it’s just procedure procedure that’s all um and here there was chaos since remember in the original cares act you could not do both programs so if you had done PPP you might not do ERC in the original program and when they changed the law in 2021 the banks were refraining from doing ERC since it’s not alone so you’re getting a tax refund so the government never made it clear to anybody about how to.
do this does your CFO understand how to do this not actually he or she’s never ever done it previously do the banks do it nope the banks do not do it the payroll companies yeah a few of them are doing it as a payroll business your accountant no your accountant’s never done this before unless you have an account that entered into this company and bottom line my company Kevin has actually stayed in business because 2009 and we’ve been dealing with the federal government and the state federal government to recover cash for Fortune 500 Fortune 1000 business so a lot of our big huge corporate clients have actually dealt with bottom line to recover other government programs we have actually done sales tax and use tax joblessness tax work opportunity tax credits research and development tax credits unclaimed property property tax all of these other government programs.
The employee retention tax credit is a broad based refundable tax credit designed to motivate.
employers to keep workers on their payroll. The credit is 50% of up to $10,000 in wages paid by an.
employer whose company is completely or partly suspended because of COVID-19 or whose gross receipts.
decrease by more than 50%.
1. The credit is offered to all employers despite size including tax exempt companies. There are.
only two exceptions: (1) state and city governments and their instrumentalities and (2) small.
services who take Small company Loans.
2. To certify, the company has to meet one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the employer’s company is totally or partly suspended by government order due to COVID-19.
during the calendar quarter or.
o the company’s gross invoices are below 50% of the comparable quarter in 2019. As soon as the.
company’s gross invoices go above 80% of a comparable quarter in 2019 they no longer certify.
after the end of that quarter.
Calculation of the Credit.
The amount of the credit is 50% of the certifying earnings paid up to $10,000 in overall.
It works for earnings paid after March 13th and prior to December 31, 2020.
The definition of qualifying earnings varies by whether an employer had, typically, basically than.
100 workers in 2019.
Business that focus on ERC filing help usually offer knowledge and assistance to assist services browse the intricate process of claiming the credit. They can use various services, consisting of:.
How is the employee retention credit calculated? Aggregation Rules For Employee Retention Credit
Eligibility Evaluation: These business will examine your organization’s eligibility for the ERC based on factors such as your market, revenue, and operations. They can help identify if you fulfill the requirements for the credit and recognize the optimum credit quantity you can declare.
Paperwork and Estimation: ERC filing services will help in gathering the needed paperwork, such as payroll records and monetary statements, to support your claim. They will likewise help determine the credit quantity based upon eligible wages and other qualifying costs.
Retroactive Claim Review: If you are qualified to claim the ERC for prior quarters, these business can examine your previous payroll records and financials to identify possible chances for retroactive credits. They can assist you modify previous income tax return to claim these refunds.
Filing Support: Companies specializing in ERC filings will prepare and send the essential kinds and documentation on your behalf. This consists of finishing Kind 941 or any other necessary tax forms.
Compliance and Updates: ERC regulations and guidance have actually developed over time. These business remain updated with the current modifications and make sure that your filings adhere to the most current standards. They can also supply continuous assistance if the IRS demands additional details or conducts an audit related to your ERC claim.
It is very important to research and veterinarian any company using ERC filing help to ensure their credibility and knowledge. Look for established companies with experience in tax and payroll services, or think about reaching out to relied on accounting firms or tax professionals who provide ERC submitting support.
Bear in mind that while these business can supply important help, it’s always a great concept to have a standard understanding of the ERC requirements and procedure yourself. This will assist you make notified choices and guarantee accurate filings.
The Worker Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief procedures. The objective of the ERC is to motivate companies to keep and pay their staff members during the pandemic, even if their operations have actually been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is offered to qualified companies, consisting of for-profit organizations, tax-exempt companies, and certain governmental entities. To qualify, employers need to meet one of two criteria:.
Business operations were completely or partially suspended due to a government order related to COVID-19.
Business experienced a significant decline in gross invoices. As discussed earlier, for 2021, a significant decrease is specified as a 20% decline in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a considerable decrease is defined as a 20% decline in gross invoices compared to the exact same quarter in 2019, or a 20% decrease in gross receipts compared to the right away preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the employer’s share of Social Security taxes. The credit quantity amounts to a percentage (approximately 70%) of certified salaries paid to employees, consisting of specific health plan expenses. The maximum credit per employee is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: At first, companies that received a Paycheck Protection Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 permits services to declare the ERC even if they got a PPP loan. Nevertheless, the same wages can not be utilized to claim both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has actually been retroactively broadened and improved, permitting qualified employers to declare the credit for qualified earnings paid as far back as March 13, 2020. This retroactive provision supplies an opportunity for organizations to modify prior-year tax returns and get refunds.
Declaring the Credit: Companies can declare the ERC by reporting it on their employment tax returns, typically Form 941. The excess can be refunded to the employer if the credit exceeds the amount of employment taxes owed.
It is very important to keep in mind that the ERC arrangements and eligibility criteria have actually evolved in time. The best course of action is to speak with a tax professional or check out the official IRS website for the most detailed and current information concerning the ERC, including any current legal changes or updates.
To qualify for the ERC, an organization should meet one of the following criteria:.
Business operations were totally or partially suspended due to a government order related to COVID-19.
The business experienced a significant decline in gross invoices. For 2021, a significant decline is defined as a 20% decline in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a considerable decline is specified as a 20% decrease in gross invoices compared to the very same quarter in 2019, or a 20% decline in gross invoices compared to the instantly preceding quarter.
The ERC is offered to companies of all sizes, consisting of tax-exempt companies, but there are some exceptions. Federal government entities and businesses that received a PPP loan might have limitations on claiming the credit.
The process for declaring the ERC includes finishing the needed types and consisting of the credit on your work income tax return (typically Kind 941). The exact time it takes to process the credit can vary based on a number of elements, consisting of the complexity of your organization and the workload of the internal revenue service. It’s advised to seek advice from a tax expert for guidance particular to your circumstance.
There are a number of companies that can help with the procedure of declaring the ERC. Some widely known business that use help with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the details offered here is based upon general knowledge and may not reflect the most recent updates or modifications to the ERC. It is essential to talk to a tax expert or check out the main internal revenue service website for the most precise and updated details relating to eligibility, declaring procedures, and offered support.
Less than 100. The credit is based if the company had 100 or less workers on average in 2019.
on wages paid to all employees whether they in fact worked or not. In other words, even if the.
workers worked full time and got paid for full-time work, the company still gets the credit.
Greater than 100. If the company had more than 100 staff members usually in 2019, then the credit is.
enabled just for wages paid to staff members who did not work during the calendar quarter.
In both cases, “wages” consists of not simply money payments however also a portion of the expense of employer.
offered health care. Aggregation Rules For Employee Retention Credit
Employers can be immediately compensated for the credit by lowering the amount of payroll taxes they.