Lets talk first about Business Employee Retention Credit :
Our group here what do these guys doing everyone in this room is assisting teach people about ERC and uh constantly offer a stunning breakfast and have people truly discover the program we should head to the room where we have the ability to show a few of the checks that we are getting for business and I ‘d like to see that what is this this is uh numerous millions of dollars literally Kevin hundreds of millions of dollars so these are replicate copies of the letters that go to clients confirming that the check is on the way I indicate you understand if you just start to take a 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 suggest it’s simply I mean consider 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 validated and the check is on the mail in the mail from the IRS heading to the customer so that’s how you have the ability to track it you know when you
receive this you know the check is gone for sure and that’s when they pay so they do not pay anything until they really get the money they do not pay bottom line Wonder trust anything till this letter is validated the check is on the way they transfer it into their bank account and they can genuinely trust Wonder trust that the procedure has been ended up and the number of you think you have actually processed because you started this we’re about 35 000 of these for
about 6 billion dollars wow so clearly they know what they’re doing and that’s what you require you require professionals on the other end of the phone to process this and get it to where you get one of these that’s what matters all right Mr Terrific here you’re at my YouTube channel we’re talking about something truly crucial today the employee retention credit which the majority of you have actually never ever heard of I certainly had not heard of it until extremely recently and learned a lot about it because this is probably the lowest expense of capital for any small company anywhere
anytime if you have employees between 5 and five hundred so I’ve got the expert with me this is Josh Fox he’s the creator and CEO of bottom line Ideas they’re the largest processor of these ERC credits this is a 170 page program so it’s challenging this isn’t like PPP we simply phone your bank manager and say provide me a loan it doesn’t work there’s not a loan it’s an application and Josh is going to inform us all about it and how to get it and why I’ve become yes the Ambassador and paid representative for this I like this program it’s disappearing very soon you got to learn 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 three chances 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 2 of them are loans and one’s a refund exactly so the ERC is a refund that’s.
fix the money money payroll tax refund fine go on sorry I just have to make certain we got that point I mean that’s a huge distinction a loan versus money money 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 original cares Act is the ERC and yes Kevin it is a stunning difficult check in the mail where you get real cash from the internal revenue service all right so let’s speak about how it works due to the fact that it sounds like to me if it’s a if it’s employee retention credit that person needed to be a staff member 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 staff members right you needed to have actually owned a business however it’s based upon you having W-2 workers in America not 10.99. As long as you had W-2 staff members 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 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 3 of 2021. alright so that’s how it’s measured you need to be on the W-2 throughout that duration now let’s talk my favorite part money just how much can you return per staff member that was on a W-2 in those 6 quarters so the computation in 2020 to be precise Kevin is 50 of the staff member’s income to an optimum of five thousand dollars per staff member for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the worker’s salary to a maximum of seven thousand per quarter how did that happen um they simply changed the rules in.
2021 versus due to the fact that 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 up to 5 thousand Max and then what takes place 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 staff member that is because that’s a lot of cash it is now there’s a caution here the PPP money would need to be decreased from the twenty six thousand dollars so if you took PPP loan one and PPP loan 2 you would lower the 26 000 so what we’re seeing on average Kevin is if you took PPP cash 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 staff members and you took PPP money you would still get a million dollar in the mail from the internal revenue service so it’s substantial certainly now the big concern is why does no one learn about this because 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 business I’m a major supporter for entrepreneurship in America and make lots of numerous financial investments in business owners of which lots of suffered through the pandemic when I first heard about this I called BS I don’t think it due to the fact that I use the PPP we went through the money center Banks to get it it was extremely 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 stay alive during the pandemic so when I heard about this I said nah it can’t be true but when I dug around I even called to my political leader pals Guv Senators they didn’t understand about it I imply that’s how you understand that’s how misinformation is that there’s no details out there then a lot of people informed me well you can’t get it because you took the PPP also not true so let’s ask Josh why does no one know about the employee retention credit you understand what’s interesting you’re discussing the banks Kevin due to the fact that in the PPP loan procedure 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 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 simply process process that’s all um and here there was chaos due to the fact that keep in mind in the original cares act you could refrain from doing both programs so if you had actually done PPP you might refrain from doing ERC in the initial 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 federal government never ever made it clear to any person about how to.
do this does your CFO know how to do this not really he or she’s never ever done it previously do the banks do it nope the banks do not do it the payroll business yeah a few of them are doing it as a payroll company your accountant no your accountant’s never done this before unless you have an account that entered into this business and bottom line my firm Kevin has stayed in business because 2009 and we’ve been dealing with the federal government and the state federal government to recover money for Fortune 500 Fortune 1000 companies so a great deal of our huge huge corporate clients have dealt with bottom line to recuperate other federal government programs we’ve done sales tax and utilize tax unemployment tax work opportunity tax credits research and development tax credits unclaimed property property tax all of these other government programs.
The staff member retention tax credit is a broad based refundable tax credit designed to motivate.
employers to keep staff members on their payroll. The credit is 50% of approximately $10,000 in salaries paid by an.
Because of COVID-19 or whose gross receipts, company whose service is completely or partly suspended.
decrease by more than 50%.
1. The credit is available to all employers no matter size consisting of tax exempt organizations. There are.
only two exceptions: (1) state and city governments and their instrumentalities and (2) small.
companies who take Small company Loans.
2. To qualify, the company has to meet one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the company’s organization is totally or partly 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 similar quarter in 2019. As soon as the.
employer’s gross receipts exceed 80% of an equivalent quarter in 2019 they no longer certify.
after the end of that quarter.
Computation of the Credit.
The amount of the credit is 50% of the qualifying incomes paid up to $10,000 in overall.
It works for incomes paid after March 13th and prior to December 31, 2020.
The meaning of qualifying salaries differs by whether a company had, typically, basically than.
100 employees in 2019.
Companies that concentrate on ERC filing assistance typically supply know-how and support to assist companies browse the intricate process of claiming the credit. They can offer various services, consisting of:.
How is the employee retention credit calculated? Business Employee Retention Credit
Eligibility Assessment: These companies will evaluate your company’s eligibility for the ERC based upon factors such as your industry, profits, and operations. They can help identify if you fulfill the requirements for the credit and recognize the maximum credit amount you can declare.
Documents and Calculation: ERC filing services will help in gathering the required documentation, such as payroll records and monetary declarations, to support your claim. They will likewise assist calculate the credit amount based on eligible salaries and other certifying costs.
Retroactive Claim Review: If you are eligible to declare the ERC for previous quarters, these companies can review your previous payroll records and financials to identify potential chances for retroactive credits. They can help you modify prior tax returns to claim these refunds.
Filing Help: Business focusing on ERC filings will prepare and submit the needed forms and paperwork on your behalf. This includes finishing Type 941 or any other necessary tax forms.
Compliance and Updates: ERC regulations and assistance have evolved over time. These business remain upgraded with the latest modifications and make sure that your filings abide by the most current guidelines. If the IRS demands extra info or carries out an audit associated to your ERC claim, they can also offer ongoing assistance.
It is essential to research and vet any business using ERC filing support to guarantee their credibility and expertise. Search for recognized firms with experience in tax and payroll services, or consider reaching out to trusted accounting firms or tax experts who offer ERC filing support.
Keep in mind that while these companies can provide valuable assistance, it’s always a good idea to have a standard understanding of the ERC requirements and process yourself. This will help you make notified choices and guarantee precise filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit presented by the U.S. government as part of COVID-19 relief measures. The objective of the ERC is to motivate companies to retain and pay their workers during the pandemic, even if their operations have actually been affected.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is readily available to qualified companies, consisting of for-profit companies, tax-exempt companies, and specific governmental entities. To qualify, companies need to fulfill one of two requirements:.
Business operations were totally or partly suspended due to a government order related to COVID-19.
Business experienced a considerable decline in gross receipts. As mentioned previously, for 2021, a significant decline is defined as a 20% decrease in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a significant decline is specified as a 20% decline in gross invoices 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 (up to 70%) of qualified salaries paid to staff members, including certain health insurance costs. The maximum credit per staff member is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, services that received a Paycheck Protection Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 permits companies to claim the ERC even if they got a PPP loan. The same wages can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively expanded and boosted, permitting qualified companies to declare the credit for qualified salaries paid as far back as March 13, 2020. This retroactive arrangement supplies an opportunity for companies to amend prior-year income tax return and receive refunds.
Claiming the Credit: Companies can claim the ERC by reporting it on their employment tax returns, generally Form 941. The excess can be reimbursed to the company if the credit surpasses the quantity of work taxes owed.
It’s important to note that the ERC arrangements and eligibility requirements have developed with time. The very best course of action is to talk to a tax expert or check out the main IRS website for the most in-depth and updated details concerning the ERC, consisting of any current legal changes or updates.
To receive the ERC, a business needs to fulfill among the following requirements:.
Business operations were fully or partially suspended due to a government order related to COVID-19.
Business experienced a substantial decline in gross invoices. For 2021, a considerable decline is defined as a 20% decline in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a significant decrease is specified as a 20% decline in gross invoices compared to the very same quarter in 2019, or a 20% decrease in gross invoices compared to the right away preceding quarter.
The ERC is readily available to businesses of all sizes, consisting of tax-exempt organizations, but there are some exceptions. For example, federal government entities and organizations that received a PPP loan might have restrictions on claiming the credit.
The procedure for claiming the ERC includes finishing the necessary forms and including the credit on your employment income tax return (usually Kind 941). The exact time it takes to process the credit can vary based upon numerous aspects, consisting of the complexity of your organization and the workload of the IRS. It’s suggested to seek advice from a tax professional for guidance particular to your circumstance.
There are several business that can aid with the process of declaring the ERC. These consist of accounting firms, tax advisory services, and payroll company. Some widely known business that provide help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s recommended to research study and call these companies straight to inquire about their costs and services.
Please keep in mind that the info provided here is based on basic understanding and may not reflect the most recent updates or modifications to the ERC. It is essential to speak with a tax expert or visit the main internal revenue service website for the most accurate and up-to-date details relating to eligibility, claiming procedures, and offered support.
Less than 100. The credit is based if the company had 100 or fewer staff members on average in 2019.
on salaries paid to all employees whether they really worked or not. Simply put, even if the.
staff members worked full time and made money for full-time work, the employer still gets the credit.
Greater than 100. The credit is if the company had more than 100 workers on average in 2019.
permitted just for wages paid to employees who did not work throughout the calendar quarter.
In both cases, “salaries” consists of not simply money payments but likewise a portion of the expense of company.
supplied healthcare. Business Employee Retention Credit
Employers can be right away repaid for the credit by decreasing the amount of payroll taxes they.