Lets talk first about Can You Take Ppp And Employee Retention Credit :
Our group here what do these people doing everybody in this space is assisting teach individuals about ERC and uh always supply a beautiful breakfast and have people actually find out about the program we need to head to the room where we are able to display a few of the checks that we are getting for companies and I wish to see that what is this this is uh hundreds of countless dollars actually Kevin hundreds of millions of dollars so these are duplicate copies of the letters that go to clients validating that the check is on the way I mean you understand if you just 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 imply it’s simply I suggest consider the number of 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 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’re able to track it you understand when you
get this you know the check is gone for sure and that’s when they pay so they don’t pay anything until they really get the cash they don’t pay bottom line Wonder trust anything up until this letter is validated the check is on the way they deposit it into their bank account and they can truly trust Wonder trust that the procedure has been finished and the number of you believe you have actually processed because you started this we have to do with 35 000 of these for
about six billion dollars wow so clearly they understand what they’re doing which’s what you require 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 Terrific here you’re at my YouTube channel we’re talking about something truly crucial today the employee retention credit which most of you have never heard of I definitely had not heard of it till really just recently and discovered a lot about it due to the fact that this is probably the most affordable cost of capital for any small business anywhere
anytime if you have employees between five and five hundred so I have actually got the specialist with me this is Josh Fox he’s the creator and CEO of bottom line Principles they’re the largest processor of these ERC credits this is a 170 page program so it’s hard this isn’t like PPP we simply call your bank manager and say give 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 spokesperson for this I love this program it’s going away very soon you got to discover all about it let’s talk staff member retention credit Josh Fox what is an ERC let’s just start there so during the Trump Administration when President Trump was enacted they created the cares Act and the cares act used services 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 huge distinction right there two of them are loans and one’s a refund precisely so the ERC is a refund that’s.
correct the cash money payroll tax refund all right go on sorry I simply need to make sure we got that point I indicate that’s a huge difference a loan versus cash cash 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 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 internal revenue service 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 employee retention credit that person needed to be a staff member so I’m going to make the Presumption 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 service but it’s based upon you having W-2 staff members 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 qualified 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 correct so there were six quarters the program was open well stroll us through the 6 quarters so you had quarters 2 3 and four of 2020 and you had quarters one two and three of 2021. alright so that’s how it’s measured you need to be on the W-2 during that duration now let’s talk my favorite part cash how much can you get back per employee that was on a W-2 in those six quarters so the calculation in 2020 to be precise Kevin is 50 of the staff member’s wage to a maximum of five thousand dollars per staff member for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the staff member’s income to an optimum of seven thousand per quarter how did that happen um they just changed the rules in.
2021 versus because the turmoil 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 five thousand Max and after that what occurs 21 000 Max in 2021 oh that’s how you create twenty 6 thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty 6 thousand dollars per staff member that is because that’s a great deal of money 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 2 you would minimize the 26 000 so what we’re seeing on average Kevin is if you took PPP money someplace around 10 thousand dollars an individual so let’s say hypothetically you owned a restaurant 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 internal revenue service so it’s substantial undoubtedly now the huge question is why does nobody learn about this because look when I initially found out about this when I first met Josh you understand I have actually got great deals of financial investments in great deals of business I’m a significant supporter for entrepreneurship in America and make many numerous financial investments in entrepreneurs of which many suffered through the pandemic when I first found out about this I called BS I don’t think it since I utilize the PPP we went through the cash 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 utilized them sensibly to survive throughout the pandemic so when I heard about this I said nah it can’t be true but when I dug around I even contacted us to my political leader friends Governor 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 real so let’s ask Josh why does nobody know about the staff member retention credit you know what’s intriguing you’re speaking about the banks Kevin since in the PPP loan procedure the federal government made it very clear that if you desired 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 procedure procedure that’s all um and here there was turmoil because remember in the initial cares act you could not do 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 refraining from doing ERC since 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 truly she or he’s never done it previously 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 accounting professional no your accounting professional’s never ever done this before unless you have an account that went into this service and bottom line my firm Kevin has actually stayed in business since 2009 and we’ve been working with the federal government and the state government to recuperate money for Fortune 500 Fortune 1000 companies so a great deal of our big big corporate clients have worked with bottom line to recuperate other government programs we have actually done sales tax and use tax unemployment tax work opportunity tax credits research and development tax credits unclaimed property real estate 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 staff members on their payroll. The credit is 50% of approximately $10,000 in earnings paid by an.
company whose business is totally or partly suspended because of COVID-19 or whose gross receipts.
decline by more than 50%.
1. The credit is readily available to all companies no matter size including tax exempt organizations. There are.
just two exceptions: (1) state and city governments and their instrumentalities and (2) small.
organizations who take Small Business Loans.
2. To qualify, the company needs to meet one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the employer’s service is totally or partially suspended by federal government order due to COVID-19.
during the calendar quarter or.
o the company’s gross invoices are below 50% of the similar quarter in 2019. As soon as the.
company’s gross receipts go above 80% of a comparable quarter in 2019 they no longer certify.
after completion of that quarter.
Computation of the Credit.
The amount of the credit is 50% of the certifying earnings paid up to $10,000 in overall.
It is effective for incomes paid after March 13th and prior to December 31, 2020.
The definition of qualifying salaries differs by whether an employer had, usually, more or less than.
100 employees in 2019.
Companies that focus on ERC filing support generally provide competence and support to help companies browse the complex process of claiming the credit. They can offer various services, consisting of:.
How is the employee retention credit calculated? Can You Take Ppp And Employee Retention Credit
Eligibility Assessment: These business will evaluate your service’s eligibility for the ERC based on elements such as your market, profits, and operations. They can help figure out if you fulfill the requirements for the credit and identify the maximum credit quantity you can claim.
Paperwork and Computation: ERC filing services will assist in gathering the necessary documentation, such as payroll records and financial declarations, to support your claim. They will likewise help calculate the credit quantity based upon qualified earnings and other qualifying expenses.
Retroactive Claim Review: If you are eligible to declare the ERC for prior quarters, these business can examine your previous payroll records and financials to identify prospective chances for retroactive credits. They can help you change prior tax returns to claim these refunds.
Filing Support: Companies concentrating on ERC filings will prepare and send the required forms and documentation in your place. This consists of finishing Type 941 or any other necessary tax forms.
Compliance and Updates: ERC policies and assistance have actually developed in time. These business stay updated with the latest changes and make sure that your filings adhere to the most present standards. They can also supply ongoing assistance if the IRS demands additional details or conducts an audit related to your ERC claim.
It is necessary to research and veterinarian any business offering ERC filing assistance to ensure their trustworthiness and knowledge. Try to find recognized companies with experience in tax and payroll services, or consider reaching out to trusted accounting companies or tax professionals who provide ERC filing assistance.
Bear in mind that while these business can provide important assistance, it’s always a good concept to have a standard understanding of the ERC requirements and procedure yourself. This will help you make informed decisions and make sure accurate filings.
The Worker Retention Credit (ERC) is a refundable tax credit introduced by the U.S. federal government as part of COVID-19 relief procedures. The goal of the ERC is to encourage companies to retain and pay their workers during the pandemic, even if their operations have been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is readily available to qualified companies, including for-profit companies, tax-exempt companies, and particular governmental entities. To certify, employers need to meet one of two requirements:.
Business operations were fully or partly suspended due to a federal government order related to COVID-19.
Business experienced a substantial decrease in gross receipts. As mentioned earlier, for 2021, a substantial decline is defined as a 20% decrease in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a substantial decline is specified as a 20% decline in gross invoices compared to the exact same quarter in 2019, or a 20% decrease in gross invoices compared to the immediately preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit quantity is equal to a portion (approximately 70%) of qualified wages paid to staff members, including specific health plan expenditures. 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, organizations that received an Income Security Program (PPP) loan were not qualified for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 enables businesses to declare the ERC even if they received a PPP loan. Nevertheless, the very same earnings can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has actually been retroactively broadened and boosted, allowing eligible employers to claim the credit for certified incomes paid as far back as March 13, 2020. This retroactive arrangement supplies a chance for organizations to change prior-year tax returns and get refunds.
Claiming the Credit: Companies can claim the ERC by reporting it on their employment income tax return, normally Kind 941. The excess can be refunded to the employer if the credit exceeds the amount of employment taxes owed.
It is very important to note that the ERC arrangements and eligibility requirements have developed over time. The very best course of action is to seek advice from a tax expert or go to the main internal revenue service website for the most detailed and updated details concerning the ERC, including any current legislative modifications or updates.
To receive the ERC, a service should fulfill among the following requirements:.
The business operations were fully or partially suspended due to a government order related to COVID-19.
The business experienced a significant decrease in gross invoices. 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 considerable decrease is defined 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 available to companies of all sizes, consisting of tax-exempt organizations, however there are some exceptions. For instance, government entities and companies that got a PPP loan may have restrictions on declaring the credit.
The process for declaring the ERC involves finishing the required forms and consisting of the credit on your employment income tax return (typically Kind 941). The exact time it requires to process the credit can vary based upon several factors, including the complexity of your organization and the work of the IRS. It’s recommended to seek advice from a tax professional for guidance specific to your scenario.
There are numerous companies that can help with the procedure of declaring the ERC. These include accounting companies, tax advisory services, and payroll company. Some widely known companies that provide assistance with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s a good idea to research and contact these business directly to inquire about their services and charges.
Please note that the details supplied here is based on basic knowledge and may not show the most recent updates or changes to the ERC. It is essential to talk to a tax professional or go to the official IRS website for the most precise and up-to-date details regarding eligibility, claiming treatments, and offered help.
Less than 100. If the employer had 100 or fewer staff members typically in 2019, then the credit is based.
on earnings paid to all staff members whether they in fact worked or not. Simply put, even if the.
staff members worked full-time and got paid for full time work, the employer still gets the credit.
Greater than 100. The credit is if the employer had more than 100 employees on average in 2019.
permitted just for earnings paid to workers who did not work during the calendar quarter.
In both cases, “incomes” consists of not just cash payments but likewise a portion of the expense of company.
provided health care. Can You Take Ppp And Employee Retention Credit
Employers can be instantly repaid for the credit by minimizing the amount of payroll taxes they.