Lets talk first about Available Employee Retention Credit Cares Act :
Our group here what do these men doing everybody in this room is helping teach individuals about ERC and uh always supply a gorgeous breakfast and have individuals truly find out about 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 want to see that what is this this is uh hundreds of millions of dollars actually Kevin numerous millions of dollars so these are duplicate copies of the letters that go to clients verifying that the check is on the way I indicate you know if you simply begin to look at some of these here I indicate this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I suggest it’s just I imply think about how many real clients that went through the program yeah this is the very end this is the party at the end when the check is verified the numbers are validated and the check is on the mail in the mail from the internal revenue service heading to the client so that’s how you have the ability to track it you know when you
receive this you understand the check is chosen sure and that’s when they pay so they don’t pay anything till they actually get the cash they don’t pay bottom line Wonder trust anything until this letter is validated the check is on the way they deposit it into their bank account and they can genuinely trust Wonder trust that the process has actually been ended up and how many you believe you have actually processed because you began this we’re about 35 000 of these for
about six billion dollars wow so plainly they understand what they’re doing and that’s what you need you need 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 important today the employee retention credit which most of you have actually never ever become aware of I definitely had not become aware of it up until very just recently and found out a lot about it because this is most likely the lowest expense of capital for any small company anywhere
anytime if you have employees in between 5 and five hundred so I’ve got the specialist with me this is Josh Fox he’s the creator and CEO of bottom line Concepts they’re the largest 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 supervisor and state offer me a loan it does not work there’s not a loan it’s an application and Josh is going to tell all of us about it and how to get it and why I’ve become yes the Ambassador and paid representative for this I love this program it’s disappearing soon you got to learn everything 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 created the cares Act and the cares act used businesses three chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and almost everybody it makes a big difference right there 2 of them are loans and one’s a refund exactly so the ERC is a refund that’s.
correct the money cash payroll tax refund okay go on sorry I just have to ensure we got that point I imply that’s a big difference a loan versus money money I like money cash that’s what we’re talking about alright 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 difficult check in the mail where you get actual money from the internal revenue service all right so let’s speak about how it works since it seems 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 Presumption this money is not for the owner not for people on the cap table not for shareholders it’s for workers right you needed to have owned a business however it’s based on you having W-2 staff members in America not 10.99. As long as you had W-2 workers and you paid federal payroll taxes that’s why you would be eligible so you have to be on payroll in 2020 on the W-2 and you have to be on payroll for the very first 6 months of 2021 on the W-2 proper so there were six quarters the program was open well stroll us through the 6 quarters so you had quarters 2 three and four of 2020 and you had quarters one two and 3 of 2021. alright so that’s how it’s determined you need to be on the W-2 during that duration now let’s talk my favorite part money how much can you return per employee that was on a W-2 in those six quarters so the calculation in 2020 to be exact Kevin is 50 of the worker’s wage to a maximum of 5 thousand dollars per employee for the year of 2020 and in 2021 the numbers escalated to 70 of the staff member’s income to an optimum of seven thousand per quarter how did that take place um they simply changed the rules in.
2021 versus because the turmoil of the pandemic so they wished to even get more to keep those workers on payroll 100 so if you can get 5 000 per person Max in twenty that was 50 in 2020 approximately five thousand Max and then what occurs 21 000 Max in 2021 oh that’s how you create twenty six thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty six thousand dollars per employee that is since that’s a great deal of cash it is now there’s a caveat here the PPP money would need to be minimized from the twenty 6 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 money someplace around ten thousand dollars an individual so let’s state hypothetically you owned a dining establishment in New York City where I’m from and you had a hundred employees and you took PPP money you would still get a million dollar in the mail from the IRS so it’s substantial certainly now the huge question is why does no one learn about this since look when I first became aware of this when I initially met Josh you understand I’ve got great deals of investments in great deals of business I’m a significant advocate for entrepreneurship in America and make numerous many investments in business owners of which many suffered through the pandemic when I first heard about this I called BS I don’t believe it because I utilize the PPP we went through the money 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 deserved and we utilized them sensibly to survive during the pandemic so when I found out about this I said nah it can’t hold true but when I dug around I even contacted us to my political leader friends 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 bunch of people informed me well you can’t get it since you took the PPP also not true so let’s ask Josh why does nobody learn about the worker retention credit you know what’s intriguing you’re discussing the banks Kevin since in the PPP loan process the federal government made it extremely clear that if you desired a PPP loan you would call Wells Fargo Citibank Bank of America any of the big banks in our nation and they would process process in Canada a pre-pp loan there’s no loans in Canada by the way it’s just process process that’s all um and here there was turmoil due to the fact that keep in mind in the initial cares act you might refrain from doing both programs so if you had done PPP you could refrain from doing ERC in the original program and when they changed the law in 2021 the banks were not doing ERC since it’s not alone so you’re getting a tax refund so the federal government never ever made it clear to anyone about how to.
do this does your CFO understand how to do this not actually she or he’s never done it in the past do the banks do it nope the banks do not do it the payroll business yeah some of them are doing it as a payroll company your accountant no your accounting professional’s never ever done this prior to unless you have an account that entered into this organization and bottom line my company Kevin has actually been in business considering that 2009 and we have actually been working with the federal government and the state government to recover money for Fortune 500 Fortune 1000 companies so a great deal of our huge big business customers have dealt with bottom line to recover other federal government programs we have actually done sales tax and use tax unemployment tax work chance tax credits research and development tax credits unclaimed property property tax all of these other federal government programs.
The employee retention tax credit is a broad based refundable tax credit created to motivate.
employers to keep workers on their payroll. The credit is 50% of as much as $10,000 in earnings paid by an.
Since of COVID-19 or whose gross receipts, employer whose organization is totally or partially suspended.
decline by more than 50%.
1. The credit is readily available to all employers no matter size including tax exempt companies. There are.
just two exceptions: (1) state and local governments and their instrumentalities and (2) little.
services who take Small Business Loans.
2. To certify, the employer has to satisfy one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the employer’s company is completely or partially suspended by government order due to COVID-19.
throughout the calendar quarter or.
o the employer’s gross receipts are listed below 50% of the comparable quarter in 2019. Once the.
employer’s gross invoices exceed 80% of a comparable quarter in 2019 they no longer qualify.
after the end of that quarter.
Estimation of the Credit.
The amount of the credit is 50% of the certifying incomes paid up to $10,000 in overall.
It is effective for incomes paid after March 13th and prior to December 31, 2020.
The meaning of certifying incomes varies by whether an employer had, typically, more or less than.
100 workers in 2019.
Companies that concentrate on ERC filing assistance generally supply knowledge and assistance to assist organizations browse the intricate process of declaring the credit. They can offer various services, consisting of:.
How is the employee retention credit calculated? Available Employee Retention Credit Cares Act
Eligibility Assessment: These business will assess your service’s eligibility for the ERC based upon aspects such as your industry, revenue, and operations. If you fulfill the requirements for the credit and identify the maximum credit quantity you can claim, they can help determine.
Paperwork and Computation: ERC filing services will assist in gathering the required documentation, such as payroll records and monetary declarations, to support your claim. They will also help compute the credit quantity based upon eligible salaries and other qualifying expenses.
Retroactive Claim Evaluation: If you are eligible to declare the ERC for previous quarters, these companies can review your previous payroll records and financials to identify prospective chances for retroactive credits. They can help you amend prior income tax return to declare these refunds.
Filing Support: Business specializing in ERC filings will prepare and send the needed types and documentation on your behalf. This consists of finishing Kind 941 or any other necessary tax return.
Compliance and Updates: ERC regulations and guidance have developed with time. These companies remain upgraded with the latest changes and ensure that your filings comply with the most present standards. They can likewise supply ongoing assistance if the IRS demands additional info or carries out an audit related to your ERC claim.
It’s important to research study and vet any business providing ERC filing help to guarantee their trustworthiness and know-how. Search for established firms with experience in tax and payroll services, or consider connecting to trusted accounting companies or tax specialists who use ERC filing assistance.
Keep in mind that while these companies can supply valuable support, it’s constantly a great idea to have a basic understanding of the ERC requirements and process yourself. This will assist you make informed choices and make sure accurate filings.
The Employee Retention Credit (ERC) is a refundable tax credit presented by the U.S. federal government as part of COVID-19 relief steps. The objective of the ERC is to encourage businesses to maintain and pay their staff members throughout the pandemic, even if their operations have actually been affected.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is available to qualified employers, consisting of for-profit organizations, tax-exempt companies, and particular governmental entities. To qualify, employers need to meet one of two criteria:.
Business operations were totally or partly suspended due to a federal government order related to COVID-19.
Business experienced a significant decline in gross receipts. As pointed out earlier, for 2021, a substantial decrease is specified as a 20% decrease in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a considerable decrease 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 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 amounts to a percentage (approximately 70%) of certified incomes paid to employees, including particular health plan costs. The maximum 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 received an Income Security Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 allows organizations to declare the ERC even if they received a PPP loan. The same earnings 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, enabling eligible companies to declare the credit for certified salaries paid as far back as March 13, 2020. This retroactive provision supplies an opportunity for services to modify prior-year tax returns and get refunds.
Declaring the Credit: Companies can claim the ERC by reporting it on their employment income tax return, typically Type 941. The excess can be reimbursed to the employer if the credit surpasses the quantity of work taxes owed.
It is very important to note that the ERC arrangements and eligibility requirements have developed in time. The very best strategy is to seek advice from a tax expert or check out the main internal revenue service website for the most updated and comprehensive details relating to the ERC, including any recent legislative changes or updates.
To qualify for the ERC, an organization should fulfill among the following requirements:.
Business operations were totally or partially suspended due to a federal government order related to COVID-19.
The business experienced a significant decline in gross receipts. For 2021, a significant decrease is defined as a 20% decline in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a significant 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 instantly preceding quarter.
The ERC is offered to organizations of all sizes, including tax-exempt organizations, however there are some exceptions. For example, government entities and companies that received a PPP loan may have limitations on claiming the credit.
The procedure for declaring the ERC involves completing the necessary forms and consisting of the credit on your employment income tax return (normally Kind 941). The exact time it requires to process the credit can differ based on numerous elements, including the intricacy of your organization and the workload of the internal revenue service. It’s suggested to consult with a tax professional for guidance particular to your scenario.
There are numerous business that can help with the process of claiming the ERC. These include accounting companies, tax advisory services, and payroll service providers. Some widely known business that use assistance with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s a good idea to research study and contact these business straight to inquire about their fees and services.
Please keep in mind that the info offered here is based upon basic understanding and might not show the most current updates or modifications to the ERC. It’s important to seek advice from a tax expert or visit the main internal revenue service site for the most precise and updated details regarding eligibility, declaring procedures, and readily available support.
Less than 100. If the company had 100 or fewer staff members on average in 2019, then the credit is based.
on earnings paid to all workers 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 employees typically in 2019, then the credit is.
allowed only for earnings paid to staff members who did not work during the calendar quarter.
In both cases, “wages” consists of not just money payments but likewise a portion of the expense of company.
provided healthcare. Available Employee Retention Credit Cares Act
Employers can be immediately compensated for the credit by lowering the quantity of payroll taxes they.