Lets talk first about Covid 19 Employee Retention Credit :
Our team here what do these guys doing everyone in this room is helping teach individuals about ERC and uh constantly supply a beautiful breakfast and have individuals really find out about the program we ought to head to the space where we are able to display a few of the checks that we are getting for companies and I ‘d like to see that what is this this is uh numerous millions of dollars actually Kevin hundreds of countless dollars so these are duplicate copies of the letters that go to clients validating that the check is on the method I mean you know if you simply start 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 indicate it’s simply I indicate 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 verified and the check is on the mail in the mail from the internal revenue service heading to the consumer so that’s how you have the ability to track it you know when you
receive this you understand the check is gone for sure and that’s when they pay so they don’t pay anything until they actually receive the cash they don’t pay bottom line Wonder trust anything until this letter is confirmed the check is on the way they transfer it into their savings account and they can truly rely on Wonder trust that the process has actually been completed and the number of you think you’ve processed given that you began this we’re about 35 000 of these for
about 6 billion dollars wow so plainly they understand what they’re doing which’s what you need you need specialists 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 Fantastic here you’re at my YouTube channel we’re talking about something truly important today the staff member retention credit which most of you have actually never heard of I certainly hadn’t heard of it up until really recently and learned a lot about it because this is most likely the lowest cost of capital for any small company anywhere
anytime if you have employees in between 5 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 Concepts 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 just call up 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’ve become yes the Ambassador and paid representative for this I love this program it’s disappearing very soon you got to learn everything about it let’s talk employee retention credit Josh Fox what is an ERC let’s just begin there so throughout the Trump Administration when President Trump was enacted they came up with the cares Act and the cares act used organizations 3 opportunities 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 two of them are loans and one’s a refund precisely so the ERC is a refund that’s.
correct the money money payroll tax refund all right go on sorry I just need to make certain we got that point I imply that’s a big difference a loan versus cash cash I like money cash that’s what we’re speaking about okay 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 real cash from the IRS all right so let’s discuss how it works since it sounds like to me if it’s a if it’s staff member retention credit that individual needed to be an employee so I’m going to make the Assumption this money is not for the owner not for individuals on the cap table not for investors it’s for employees right you had to have owned a service however it’s based upon you having W-2 employees 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 six months of 2021 on the W-2 right 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 two and three of 2021. okay so that’s how it’s determined you have to be on the W-2 throughout that period now let’s talk my favorite part cash how much can you return per employee that was on a W-2 in those six quarters so the calculation in 2020 to be specific Kevin is 50 of the employee’s income to an optimum of 5 thousand dollars per employee for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the worker’s income to an optimum of 7 thousand per quarter how did that happen um they just altered the rules in.
2021 versus since the chaos 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 up to 5 thousand Max and after that what happens 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 because that’s a lot of money it is now there’s a caution here the PPP cash would have to be lowered 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 somewhere around 10 thousand dollars a person so let’s state hypothetically you owned a dining establishment in New york city 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 clearly now the huge concern is why does no one understand about this because look when I initially found out about this when I initially met Josh you understand I have actually got lots of investments in great deals of business I’m a significant supporter for entrepreneurship in America and make numerous lots of financial investments in entrepreneurs of which many suffered through the pandemic when I first became aware of this I called BS I don’t believe it since I utilize 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 which were well been worthy of and we used them carefully to stay alive during the pandemic so when I became aware of this I said nah it can’t hold true but when I dug around I even contacted us to my politician good friends Guv Senators they didn’t know about it I indicate that’s how you know that’s how false information is that there’s no details out there then a lot of individuals informed me well you can’t get it due to the fact that you took the PPP also not true so let’s ask Josh why does no one learn about the staff member retention credit you know what’s interesting you’re speaking about the banks Kevin because in the PPP loan process the federal government made it really clear that if you wanted 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 simply procedure process that’s all um and here there was chaos because remember in the original cares act you could not do both programs so if you had actually done PPP you could not do ERC in the initial program and when they changed the law in 2021 the banks were refraining from doing ERC because 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 know how to do this not really he or she’s never done it in the past 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 prior to unless you have an account that went into this service and bottom line my company Kevin has actually been in business because 2009 and we’ve been working with the federal government and the state federal government to recuperate money for Fortune 500 Fortune 1000 companies so a great deal of our big big corporate customers have worked with bottom line to recover other federal government programs we’ve done sales tax and utilize tax unemployment tax work opportunity tax credits research and development tax credits unclaimed home property tax all of these other federal government programs.
The employee retention tax credit is a broad based refundable tax credit created to encourage.
companies to keep workers on their payroll. The credit is 50% of up to $10,000 in incomes paid by an.
company whose company is fully or partially 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 companies. There are.
only two exceptions: (1) state and local governments and their instrumentalities and (2) small.
organizations who take Small company Loans.
2. To qualify, the company has to meet one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the company’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 below 50% of the comparable quarter in 2019. Once the.
employer’s gross receipts go above 80% of a comparable quarter in 2019 they no longer qualify.
after completion of that quarter.
Calculation of the Credit.
The amount of the credit is 50% of the qualifying salaries paid up to $10,000 in total.
It works for earnings paid after March 13th and before December 31, 2020.
The definition of certifying salaries differs by whether an employer had, typically, more or less than.
100 workers in 2019.
Companies that focus on ERC filing help generally provide know-how and assistance to assist companies navigate the complicated process of declaring the credit. They can use different services, consisting of:.
How is the employee retention credit calculated? Covid 19 Employee Retention Credit
Eligibility Evaluation: These business will assess your organization’s eligibility for the ERC based upon factors such as your industry, income, and operations. They can assist determine if you satisfy the requirements for the credit and identify the optimum credit quantity you can declare.
Paperwork and Estimation: ERC filing services will help in collecting the essential paperwork, such as payroll records and monetary statements, to support your claim. They will likewise assist compute the credit amount based on qualified incomes and other qualifying costs.
Retroactive Claim Evaluation: If you are eligible to claim the ERC for previous quarters, these companies can examine your past payroll records and financials to determine prospective opportunities for retroactive credits. They can help you modify prior income tax return to declare these refunds.
Filing Help: Business focusing on ERC filings will prepare and submit the required types and documents 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 current changes and guarantee that your filings comply with the most existing guidelines. They can also supply ongoing support if the IRS demands additional details or carries out an audit related to your ERC claim.
It is necessary to research study and vet any company providing ERC filing support to guarantee their trustworthiness and proficiency. Try to find recognized companies with experience in tax and payroll services, or consider connecting to relied on accounting companies or tax specialists who offer ERC filing support.
Remember that while these companies can supply valuable support, it’s constantly an excellent concept to have a standard understanding of the ERC requirements and process yourself. This will assist you make notified choices and ensure accurate filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief measures. The goal of the ERC is to motivate companies to retain and pay their workers during the pandemic, even if their operations have been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is available to qualified companies, consisting of for-profit businesses, tax-exempt companies, and certain governmental entities. To certify, employers need to meet one of two criteria:.
Business operations were completely or partly suspended due to a federal government order related to COVID-19.
The business experienced a significant decline in gross invoices. As pointed out previously, 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 defined as a 20% decline in gross receipts compared to the same quarter in 2019, or a 20% decrease in gross invoices compared to the instantly preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the employer’s share of Social Security taxes. The credit amount is equal to a portion (up to 70%) of qualified incomes paid to employees, including certain health insurance expenses. The optimum credit per worker is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: At first, businesses that got an Income Protection Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 permits businesses to claim the ERC even if they received a PPP loan. The exact same wages can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively expanded and enhanced, allowing qualified companies to claim the credit for qualified wages paid as far back as March 13, 2020. This retroactive arrangement offers an opportunity for businesses to modify prior-year income tax return and receive refunds.
Claiming the Credit: Employers can claim the ERC by reporting it on their employment tax returns, normally Form 941. The excess can be refunded to the employer if the credit surpasses the amount of work taxes owed.
It is essential to keep in mind that the ERC provisions and eligibility criteria have actually developed gradually. The very best course of action is to seek advice from a tax professional or go to the main IRS website for the most comprehensive and current information regarding the ERC, consisting of any current legislative changes or updates.
To get approved for the ERC, a business must meet among the following criteria:.
The business operations were totally or partly suspended due to a federal government order related to COVID-19.
The business experienced a substantial decline in gross receipts. For 2021, a significant decline is defined as a 20% decline in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a significant decline is defined as a 20% decrease in gross invoices compared to the exact same quarter in 2019, or a 20% decrease in gross receipts compared to the immediately preceding quarter.
The ERC is offered to businesses of all sizes, including tax-exempt companies, but there are some exceptions. Government entities and businesses that received a PPP loan might have restrictions on declaring the credit.
The procedure for claiming the ERC includes finishing the necessary types and consisting of the credit on your employment income tax return (generally Form 941). The exact time it takes to process the credit can differ based upon a number of factors, consisting of the intricacy of your organization and the workload of the IRS. It’s advised to speak with a tax expert for assistance specific to your situation.
There are numerous companies that can help with the process of claiming the ERC. Some well-known companies that use assistance with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the details offered here is based on basic knowledge and may not reflect the most current updates or modifications to the ERC. It is essential to talk to a tax professional or check out the official internal revenue service site for the most accurate and current details regarding eligibility, declaring procedures, and offered assistance.
Less than 100. If the company had 100 or less staff members usually in 2019, then the credit is based.
on incomes paid to all workers whether they in fact worked or not. To put it simply, even if the.
employees worked full-time and earned money for full-time work, the employer still gets the credit.
Greater than 100. If the company had more than 100 staff members usually in 2019, then the credit is.
enabled only for earnings paid to employees who did not work during the calendar quarter.
In both cases, “wages” consists of not just money payments however also a part of the expense of company.
offered healthcare. Covid 19 Employee Retention Credit
Companies can be right away repaid for the credit by decreasing the amount of payroll taxes they.