Lets talk first about Are Employee Retention Credit Real :
Our team here what do these people doing everybody in this space is helping teach individuals about ERC and uh constantly offer a beautiful breakfast and have people actually discover the program we should head to the space where we are able to display some of the checks that we are getting for companies and I wish to see that what is this this is uh numerous countless dollars actually Kevin hundreds of millions of dollars so these are duplicate copies of the letters that go to clients confirming that the check is on the method I indicate you understand if you just start to look at some of these here I imply this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I mean it’s just I imply think about the number of actual customers that went through the program yeah this is the very end this is the celebration at the end when the check is confirmed 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 know the check is gone for sure which’s when they pay so they don’t pay anything till they actually receive the money they do not pay bottom line Wonder trust anything until this letter is verified the check is on the way they transfer it into their bank account and they can truly trust Wonder trust that the procedure has been finished and how many you believe you’ve processed considering that you began this we have to do with 35 000 of these for
about 6 billion dollars wow so clearly they know what they’re doing which’s what you need you require professionals 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 essential today the employee retention credit which the majority of you have actually never ever become aware of I definitely hadn’t become aware of it till very recently and learned a lot about it since this is probably the most affordable expense of capital for any small business anywhere
anytime if you have workers in between five and five hundred so I’ve got the specialist with me this is Josh Fox he’s the founder and CEO of bottom line Ideas they’re the biggest processor of these ERC credits this is a 170 page program so it’s difficult this isn’t like PPP we simply call your bank manager and state provide me a loan it does not work there’s not a loan it’s an application and Josh is going to tell us all about it and how to get it and why I have actually become yes the Ambassador and paid representative for this I love this program it’s going away soon you got to find out all about it let’s talk worker retention credit Josh Fox what is an ERC let’s just begin there so during the Trump Administration when President Trump was enacted they developed the cares Act and the cares act used businesses 3 opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly everybody it makes a big difference right there two of them are loans and one’s a refund precisely so the ERC is a refund that’s.
correct the money cash payroll tax refund okay go on sorry I just need to make certain we got that point I imply that’s a big difference a loan versus money cash I like money money that’s what we’re discussing all right 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 initial cares Act is the ERC and yes Kevin it is a lovely tough check in the mail where you get real money from the IRS all right so let’s speak about how it works because it seems like to me if it’s a if it’s employee retention credit that person had to be a staff member so I’m going to make the Assumption this money is not for the owner not for people on the cap table not for investors it’s for workers right you needed to have actually owned a business however it’s based on you having W-2 workers in America not 10.99. so as long as you had W-2 staff members 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 need to be on payroll for the first 6 months of 2021 on the W-2 correct so there were 6 quarters the program was open well stroll us through the 6 quarters so you had quarters two three and 4 of 2020 and you had quarters one two 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 money just how much can you get back per staff member that was on a W-2 in those six quarters so the computation in 2020 to be specific Kevin is 50 of the employee’s wage to an optimum of five thousand dollars per employee for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the staff member’s income to an optimum of 7 thousand per quarter how did that take place um they simply altered the rules in.
2021 versus because the mayhem of the pandemic so they wanted to even get more to keep those employees on payroll 100 so if you can get 5 000 per person Max in twenty that was 50 in 2020 as much as five thousand Max and after that what happens 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 6 thousand dollars per staff member that is because that’s a lot of cash it is now there’s a caveat here the PPP money would need to be reduced from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan 2 you would reduce the 26 000 so what we’re seeing usually Kevin is if you took PPP cash somewhere around 10 thousand dollars a person so let’s state hypothetically you owned a dining establishment in New York City where I’m from and you had a hundred staff members 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 huge question is why does no one learn about this because look when I first found out about this when I initially fulfilled Josh you know I’ve got lots of investments in great deals of business I’m a major supporter for entrepreneurship in America and make many many financial 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 because I use the PPP we went through the money center Banks to get it it was really easy to do we had our CEOs call the banks they got their loans and that were well been worthy of and we used them sensibly to stay alive during the pandemic so when I became aware of this I stated nah it can’t hold true but when I dug around I even contacted us to my politician pals Governor Senators they didn’t learn about it I mean that’s how you know that’s how misinformation is that there’s no info out there then a lot of people informed me well you can’t get it since you took the PPP likewise not true so let’s ask Josh why does nobody know about the worker retention credit you understand what’s fascinating you’re discussing the banks Kevin since in the PPP loan process 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 country and they would process procedure in Canada a pre-pp loan there’s no loans in Canada by the way it’s simply process procedure that’s all um and here there was turmoil because keep in mind 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 altered the law in 2021 the banks were not doing ERC due to the fact that it’s not alone so you’re getting a tax refund so the government never made it clear to any person about how to.
do this does your CFO understand how to do this not really he or she’s never done it previously do the banks do it nope the banks don’t do it the payroll companies yeah a few of them are doing it as a payroll company your accountant no your accounting professional’s never ever done this before unless you have an account that went into this organization and bottom line my company Kevin has stayed in business because 2009 and we’ve been dealing with the federal government and the state federal government to recuperate money for Fortune 500 Fortune 1000 business so a great deal of our big big business customers have actually worked with bottom line to recuperate other federal government programs we’ve done sales tax and use tax unemployment tax work chance tax credits research and development tax credits unclaimed home real estate tax all of these other government programs.
The worker retention tax credit is a broad based refundable tax credit designed to motivate.
companies to keep staff members on their payroll. The credit is 50% of up to $10,000 in wages paid by an.
Because of COVID-19 or whose gross receipts, employer whose business is completely or partially suspended.
decrease by more than 50%.
1. The credit is offered to all employers regardless of size including tax exempt organizations. There are.
only 2 exceptions: (1) state and city governments and their instrumentalities and (2) little.
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 company’s company is completely or partially suspended by federal government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross receipts are listed below 50% of the comparable quarter in 2019. As soon as the.
company’s gross receipts exceed 80% of a comparable quarter in 2019 they no longer qualify.
after completion of that quarter.
Estimation of the Credit.
The amount of the credit is 50% of the qualifying incomes paid up to $10,000 in overall.
It is effective for salaries paid after March 13th and prior to December 31, 2020.
The definition of qualifying incomes differs by whether a company had, on average, basically than.
100 workers in 2019.
Companies that specialize in ERC filing help usually offer knowledge and support to assist companies navigate the complicated process of declaring the credit. They can offer various services, consisting of:.
How is the employee retention credit calculated? Are Employee Retention Credit Real
Eligibility Assessment: These business will assess your company’s eligibility for the ERC based on aspects such as your industry, profits, and operations. They can assist determine if you meet the requirements for the credit and recognize the optimum credit quantity you can claim.
Paperwork and Computation: ERC filing services will help in gathering the required documentation, such as payroll records and monetary declarations, to support your claim. They will likewise help calculate the credit amount based upon eligible wages and other qualifying costs.
Retroactive Claim Review: If you are qualified to declare the ERC for prior quarters, these companies can evaluate your previous payroll records and financials to recognize potential opportunities for retroactive credits. They can help you modify previous income tax return to claim these refunds.
Filing Help: Companies focusing on ERC filings will prepare and send the needed types and paperwork in your place. This includes finishing Form 941 or any other necessary tax forms.
Compliance and Updates: ERC policies and assistance have evolved gradually. These business remain upgraded with the current modifications and make sure that your filings adhere to the most current guidelines. If the Internal revenue service requests additional details or conducts an audit associated to your ERC claim, they can likewise provide ongoing assistance.
It is very important to research study and veterinarian any business using ERC filing support to ensure their trustworthiness and knowledge. Try to find recognized companies with experience in tax and payroll services, or consider reaching out to relied on accounting firms or tax professionals who offer ERC submitting assistance.
Keep in mind that while these business can supply important support, it’s constantly a good concept to have a standard understanding of the ERC requirements and procedure yourself. This will assist you make notified choices and make sure precise filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief steps. The objective of the ERC is to encourage organizations to maintain and pay their staff members throughout the pandemic, even if their operations have been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is available to eligible employers, consisting of for-profit services, tax-exempt companies, and certain governmental entities. To certify, employers need to satisfy one of two criteria:.
The business operations were fully or partially suspended due to a federal government order related to COVID-19.
The business experienced a considerable decrease in gross invoices. As mentioned previously, for 2021, a considerable decrease is specified as a 20% decline in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a substantial decrease is specified as a 20% decline in gross receipts compared to the very same quarter in 2019, or a 20% decrease in gross invoices compared to the right away preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit amount is equal to a percentage (approximately 70%) of certified salaries paid to employees, consisting of particular health plan costs. The optimum credit per employee is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, businesses that got a Paycheck Defense Program (PPP) loan were not qualified for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 enables organizations to claim the ERC even if they got a PPP loan. Nevertheless, the same salaries can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively expanded and improved, enabling eligible employers to claim the credit for certified wages paid as far back as March 13, 2020. This retroactive arrangement supplies a chance for services to change prior-year tax returns and get refunds.
Claiming the Credit: Companies can declare the ERC by reporting it on their employment income tax return, typically Kind 941. The excess can be reimbursed to the company if the credit goes beyond the amount of work taxes owed.
It’s important to note that the ERC provisions and eligibility requirements have developed gradually. The very best course of action is to seek advice from a tax professional or check out the official internal revenue service website for the most in-depth and updated info regarding the ERC, including any recent legislative changes or updates.
To receive the ERC, an organization must fulfill one of the following requirements:.
The business operations were fully or partly suspended due to a federal government order related to COVID-19.
Business experienced a substantial decline in gross receipts. For 2021, a substantial decrease is specified as a 20% decline in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a considerable decline is specified as a 20% decline in gross invoices compared to the same quarter in 2019, or a 20% decline in gross invoices compared to the immediately preceding quarter.
The ERC is readily available to businesses of all sizes, including tax-exempt organizations, however there are some exceptions. Federal government entities and companies that received a PPP loan might have restrictions on claiming the credit.
The process for declaring the ERC includes finishing the required forms and consisting of the credit on your employment income tax return (usually Form 941). The exact time it takes to process the credit can vary based upon numerous aspects, including the intricacy of your business and the workload of the IRS. It’s advised to speak with a tax expert for assistance specific to your scenario.
There are numerous companies that can assist with the process of claiming the ERC. Some popular companies that use support with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the information offered here is based upon basic understanding and might not show the most current updates or modifications to the ERC. It is essential to speak with a tax professional or check out the official internal revenue service site for the most updated and accurate info relating to eligibility, claiming treatments, and offered assistance.
Less than 100. If the employer had 100 or fewer workers usually in 2019, then the credit is based.
on salaries paid to all staff members whether they really worked or not. Simply put, even if the.
employees worked full time and made money for full-time work, the company still gets the credit.
Greater than 100. If the employer had more than 100 staff members on average in 2019, then the credit is.
enabled only for salaries paid to workers who did not work throughout the calendar quarter.
In both cases, “incomes” includes not just cash payments however also a part of the cost of employer.
offered health care. Are Employee Retention Credit Real
Employers can be immediately compensated for the credit by reducing the quantity of payroll taxes they.