Lets talk first about Can Owners Be Included In Employee Retention Credit :
Our team here what do these people doing everyone in this room is assisting teach people about ERC and uh always provide a stunning breakfast and have people really learn about the program we should head to the room where we have the ability to show some of the checks that we are getting for business and I want to see that what is this this is uh hundreds of millions of dollars literally Kevin numerous millions of dollars so these are replicate copies of the letters that go to clients verifying that the check is on the method I indicate you know if you simply begin to take a 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 suggest it’s simply I imply think about the number of real clients that went through the program yeah this is the very end this is the celebration at the end when the check is validated the numbers are validated and the check is on the mail in the mail from the IRS heading to the consumer so that’s how you have the ability to track it you understand when you
get this you understand the check is gone for sure which’s when they pay so they do not pay anything up until they in fact receive the money they do not pay bottom line Wonder trust anything till this letter is verified the check is on the method they deposit it into their bank account and they can really trust Wonder trust that the process has actually been ended up and the number of you think 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 require 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 Wonderful here you’re at my YouTube channel we’re speaking about something truly important today the staff member retention credit which the majority of you have never heard of I certainly had not heard of it until really just recently and discovered a lot about it due to the fact that this is most likely the most affordable cost of capital for any small business anywhere
anytime if you have workers in between 5 and five hundred so I have actually got the professional with me this is Josh Fox he’s the founder and CEO of bottom line Concepts 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 offer me a loan it doesn’t 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 have actually ended up being yes the Ambassador and paid representative for this I enjoy this program it’s going away very 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 came up with the cares Act and the cares act provided organizations 3 chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically everyone it makes a huge 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 all right go on sorry I simply have to make sure we got that point I indicate that’s a huge difference a loan versus cash money I like money cash 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 gorgeous hard check in the mail where you get actual money from the internal revenue service all right so let’s discuss how it works due to the fact that 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 cash is not for the owner not for people on the cap table not for investors it’s for staff members right you needed to have owned an organization but it’s based on you having W-2 employees in America not 10.99. so as long as you had W-2 workers and you paid federal payroll taxes that’s why you would be qualified so you have to be on payroll in 2020 on the W-2 and you have to be on payroll for the first six months of 2021 on the W-2 proper so there were six quarters the program was open well walk us through the six quarters so you had quarters 2 3 and 4 of 2020 and you had quarters one 2 and 3 of 2021. okay 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 worker that was on a W-2 in those six quarters so the calculation in 2020 to be specific Kevin is 50 of the staff member’s income to an optimum of 5 thousand dollars per staff member for the year of 2020 and in 2021 the numbers increased to 70 of the worker’s income to a maximum of 7 thousand per quarter how did that take place um they simply altered the rules in.
2021 versus because the chaos 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 approximately 5 thousand Max and after that what takes place 21 000 Max in 2021 oh that’s how you develop twenty 6 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 lot of money it is now there’s a caveat here the PPP money would have to be lowered from the twenty six 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 money someplace around ten thousand dollars a person so let’s say hypothetically you owned a dining establishment in New York City where I’m from and you had a hundred workers and you took PPP money you would still get a million dollar in the mail from the internal revenue service so it’s substantial clearly now the huge concern is why does nobody know about this because appearance when I initially found out about this when I initially fulfilled Josh you know I have actually got great deals of financial investments in lots of business I’m a major supporter for entrepreneurship in America and make numerous lots of investments in entrepreneurs of which many suffered through the pandemic when I initially heard 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 extremely easy to do we had our CEOs call the banks they got their loans which were well been worthy of and we utilized them sensibly to stay alive during the pandemic so when I heard about this I stated nah it can’t be true however when I dug around I even contacted us to my politician friends Guv Senators they didn’t understand about it I mean 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 since you took the PPP also not real so let’s ask Josh why does nobody know about the employee retention credit you know what’s interesting you’re discussing the banks Kevin because in the PPP loan procedure the federal government made it extremely clear that if you wanted a PPP loan you would call Wells Fargo Citibank Bank of America any of the big 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 process that’s all um and here there was mayhem because keep in mind in the original cares act you could refrain from doing both programs so if you had done PPP you might refrain from doing ERC in the initial program and when they changed 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 ever made it clear to any person about how to.
do this does your CFO know how to do this not truly she or he’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 business your accountant no your accountant’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 since 2009 and we’ve been dealing with the federal government and the state federal government to recover money for Fortune 500 Fortune 1000 business so a great deal of our huge big corporate clients have dealt 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 property property tax all of these other federal government programs.
The staff member retention tax credit is a broad based refundable tax credit developed to motivate.
companies to keep workers on their payroll. The credit is 50% of up to $10,000 in salaries paid by an.
employer whose service is totally or partially suspended because of COVID-19 or whose gross invoices.
decline by more than 50%.
1. The credit is offered to all employers no matter size including tax exempt companies. There are.
only two exceptions: (1) state and local governments and their instrumentalities and (2) little.
services who take Small company Loans.
2. To qualify, the company has to fulfill one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the company’s organization is completely 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. Once the.
company’s gross receipts exceed 80% of a comparable quarter in 2019 they no longer certify.
after completion of that quarter.
Computation of the Credit.
The quantity of the credit is 50% of the certifying wages 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 certifying wages varies by whether an employer had, typically, more or less than.
100 workers in 2019.
Companies that focus on ERC filing assistance typically offer knowledge and support to help services navigate the intricate procedure of claiming the credit. They can provide different services, consisting of:.
How is the employee retention credit calculated? Can Owners Be Included In Employee Retention Credit
Eligibility Assessment: These companies will examine your service’s eligibility for the ERC based on factors such as your industry, profits, and operations. If you fulfill the requirements for the credit and recognize the optimum credit quantity you can declare, they can help determine.
Paperwork and Calculation: ERC filing services will help in collecting the necessary documents, such as payroll records and monetary declarations, to support your claim. They will also assist determine the credit quantity based upon qualified earnings and other qualifying costs.
Retroactive Claim Evaluation: If you are eligible to claim the ERC for prior quarters, these business can review your past payroll records and financials to determine possible opportunities for retroactive credits. They can help you modify prior tax returns to declare these refunds.
Filing Help: Companies focusing on ERC filings will prepare and submit the necessary types and documentation in your place. This includes completing Form 941 or any other required tax forms.
Compliance and Updates: ERC regulations and assistance have actually developed gradually. These companies stay updated with the current modifications and guarantee that your filings adhere to the most present guidelines. If the IRS demands additional info or carries out an audit associated to your ERC claim, they can likewise supply continuous assistance.
It’s important to research and veterinarian any company using ERC filing assistance to guarantee their trustworthiness and know-how. Look for recognized companies with experience in tax and payroll services, or consider reaching out to trusted accounting firms or tax professionals who offer ERC filing assistance.
Remember that while these companies can supply important assistance, it’s constantly a great idea to have a standard understanding of the ERC requirements and process yourself. This will assist you make informed decisions and ensure accurate filings.
The Worker 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 encourage organizations to maintain and pay their staff members during the pandemic, even if their operations have actually been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is offered to qualified employers, including for-profit services, tax-exempt companies, and particular governmental entities. To qualify, employers must meet one of two requirements:.
The business operations were fully or partially suspended due to a government order related to COVID-19.
Business experienced a considerable decrease in gross invoices. As mentioned earlier, for 2021, a significant decrease 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% decline in gross invoices compared to the same quarter in 2019, or a 20% decline in gross receipts compared to the instantly 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 portion (approximately 70%) of certified salaries paid to employees, including specific health plan expenditures. The optimum credit per worker is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, organizations that received a Paycheck Security Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 permits businesses to declare the ERC even if they received a PPP loan. However, 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 improved, allowing eligible employers to declare the credit for qualified incomes paid as far back as March 13, 2020. This retroactive arrangement supplies an opportunity for businesses to change prior-year tax returns and get refunds.
Declaring the Credit: Employers can claim the ERC by reporting it on their work tax returns, generally Kind 941. The excess can be refunded to the company if the credit exceeds the quantity of work taxes owed.
It is very important to keep in mind that the ERC arrangements and eligibility requirements have actually progressed with time. The very best course of action is to seek advice from a tax professional or check out the main internal revenue service website for the most comprehensive and updated details relating to the ERC, consisting of any current legal modifications or updates.
To qualify for the ERC, a business should meet one of the following criteria:.
Business operations were completely or partly suspended due to a government order related to COVID-19.
Business experienced a substantial decrease in gross invoices. For 2021, a substantial decline is specified as a 20% decline in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a considerable decrease is specified as a 20% decline in gross receipts 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 businesses of all sizes, including tax-exempt organizations, however there are some exceptions. For example, government entities and organizations that got a PPP loan might have limitations on declaring the credit.
The procedure for claiming the ERC includes completing the required types and including the credit on your work tax return (usually Type 941). The exact time it requires to process the credit can differ based on a number of factors, including the complexity of your business and the workload of the IRS. It’s recommended to seek advice from a tax professional for guidance particular to your circumstance.
There are numerous companies that can aid with the process of declaring the ERC. These consist of accounting companies, tax advisory services, and payroll provider. Some popular companies that use assistance with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s a good idea to research and get in touch with these business straight to inquire about their services and fees.
Please note that the information provided here is based on basic knowledge and may not reflect the most current updates or modifications to the ERC. It’s important to seek advice from a tax expert or check out the main IRS site for the most accurate and up-to-date information concerning eligibility, claiming treatments, and offered help.
Less than 100. If the employer had 100 or less workers usually in 2019, then the credit is based.
on salaries paid to all employees whether they in fact worked or not. To put it simply, even if the.
staff members worked full time and earned money for full time work, the company still gets the credit.
Greater than 100. The credit is if the company had more than 100 employees on average in 2019.
enabled just for wages paid to staff members who did not work throughout the calendar quarter.
In both cases, “earnings” consists of not simply cash payments however likewise a part of the expense of employer.
offered healthcare. Can Owners Be Included In Employee Retention Credit
Companies can be immediately repaid for the credit by decreasing the amount of payroll taxes they.