Lets talk first about Eligible Employer Employee Retention Credit :
Our group here what do these men doing everyone in this room is assisting teach people about ERC and uh constantly provide a beautiful breakfast and have people really find out about the program we should head to the room where we are able 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 countless dollars literally Kevin numerous millions of dollars so these are duplicate copies of the letters that go to clients validating that the check is on the way I imply you know if you simply start to take a look at some of these here I suggest this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I imply it’s just I mean think about the number of actual customers that went through the program yeah this is the very end this is the party at the end when the check is confirmed 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’re able to track it you understand when you
get this you know the check is opted for sure which’s when they pay so they do not pay anything until they really get the money they don’t pay bottom line Wonder trust anything until this letter is confirmed the check is on the method they deposit it into their bank account and they can truly rely on Wonder trust that the process has been finished and the number of you think you’ve processed since you started 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 need 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 Fantastic here you’re at my YouTube channel we’re discussing something truly important today the worker retention credit which most of you have never become aware of I definitely hadn’t become aware of it up until very recently and found out a lot about it due to the fact that this is most likely the most affordable cost of capital for any small company anywhere
anytime if you have employees in between 5 and five hundred so I’ve got the professional with me this is Josh Fox he’s the creator 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 contact your bank manager and say give 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 spokesperson for this I love this program it’s going away soon you got to learn all about it let’s talk employee 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 offered businesses three chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly everybody it makes a big distinction right there two of them are loans and one’s a refund exactly so the ERC is a refund that’s.
fix the cash cash payroll tax refund okay go on sorry I simply need to ensure we got that point I indicate that’s a huge distinction a loan versus money money I like cash money 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 gorgeous hard check in the mail where you get real money from the internal revenue service all right so let’s discuss how it works since it seems like to me if it’s a if it’s staff member retention credit that person needed 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 shareholders it’s for employees right you had to have owned a company however it’s based upon 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 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 appropriate so there were 6 quarters the program was open well stroll us through the six quarters so you had quarters two three and 4 of 2020 and you had quarters one 2 and 3 of 2021. okay so that’s how it’s measured you have to be on the W-2 during that duration now let’s talk my preferred part money how much can you get back per employee that was on a W-2 in those six quarters so the computation in 2020 to be exact Kevin is 50 of the staff member’s wage to a maximum of five thousand dollars per employee for the year of 2020 and in 2021 the numbers increased to 70 of the employee’s income to a maximum of seven thousand per quarter how did that take place um they simply changed the rules in.
2021 versus due to the fact that 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 come up with twenty 6 thousand twenty one thousand to twenty twenty one plus five thousand in twenty twenty that’s twenty six thousand dollars per staff member that is since that’s a lot of money it is now there’s a caveat here the PPP cash would need to be minimized 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 on average Kevin is if you took PPP cash somewhere around ten thousand dollars an individual so let’s state hypothetically you owned a restaurant in New york city City where I’m from and you had a hundred employees and you took PPP cash you would still get a million dollar in the mail from the internal revenue service so it’s substantial undoubtedly now the big concern is why does no one know about this due to the fact that appearance when I initially became aware of this when I first fulfilled Josh you understand I’ve got great deals of financial investments in great deals of companies I’m a major supporter for entrepreneurship in America and make lots of lots of financial investments in entrepreneurs of which many suffered through the pandemic when I first found out about this I called BS I do not believe it due to the fact that I utilize the PPP we went through the cash 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 should have and we utilized them carefully to stay alive throughout the pandemic so when I heard about this I stated nah it can’t hold true however when I dug around I even contacted us to my political leader pals Governor Senators they didn’t understand about it I mean that’s how you understand that’s how false information is that there’s no details out there then a lot of individuals told me well you can’t get it due to the fact that you took the PPP likewise not true so let’s ask Josh why does nobody learn about the employee retention credit you understand what’s interesting you’re talking about the banks Kevin due to the fact that in the PPP loan process the federal government made it really 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 procedure procedure that’s all um and here there was turmoil since keep in mind in the initial cares act you could refrain from doing both programs so if you had done PPP you might not do ERC in the initial program and when they changed the law in 2021 the banks were refraining from doing ERC due to the fact that it’s not alone so you’re getting a tax refund so the federal government never ever made it clear to anybody about how to.
do this does your CFO understand how to do this not actually he or she’s never ever 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 accounting professional’s never ever done this prior to unless you have an account that went into this business and bottom line my company Kevin has been in business considering that 2009 and we’ve been dealing with the federal government and the state federal government to recover cash for Fortune 500 Fortune 1000 business so a lot of our huge big business clients have actually worked with bottom line to recuperate other federal government programs we have actually done sales tax and use tax joblessness tax work opportunity tax credits research and development tax credits unclaimed home real estate tax all of these other federal government programs.
The employee retention tax credit is a broad based refundable tax credit designed to encourage.
companies to keep employees on their payroll. The credit is 50% of up to $10,000 in incomes paid by an.
Due to the fact that of COVID-19 or whose gross invoices, company whose company is totally or partially suspended.
decline by more than 50%.
1. The credit is readily available to all companies despite size consisting of tax exempt companies. There are.
just 2 exceptions: (1) state and local governments and their instrumentalities and (2) small.
services who take Small Business Loans.
2. To qualify, the employer has to satisfy one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the company’s business is totally or partially 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 equivalent quarter in 2019. As soon as the.
employer’s gross invoices exceed 80% of a similar quarter in 2019 they no longer certify.
after the end of that quarter.
Estimation of the Credit.
The quantity of the credit is 50% of the qualifying salaries paid up to $10,000 in total.
It works for wages paid after March 13th and prior to December 31, 2020.
The meaning of certifying wages varies by whether an employer had, on average, basically than.
100 staff members in 2019.
Companies that concentrate on ERC filing help typically offer know-how and assistance to assist services navigate the complex process of declaring the credit. They can provide different services, consisting of:.
How is the employee retention credit calculated? Eligible Employer Employee Retention Credit
Eligibility Assessment: These companies will assess your organization’s eligibility for the ERC based on factors such as your industry, profits, and operations. If you meet the requirements for the credit and determine the optimum credit quantity you can declare, they can assist determine.
Documents and Estimation: ERC filing services will assist in gathering the required documentation, such as payroll records and financial declarations, to support your claim. They will also help compute the credit quantity based on eligible salaries and other qualifying expenditures.
Retroactive Claim Review: If you are qualified to claim the ERC for prior quarters, these companies can evaluate your previous payroll records and financials to recognize possible chances for retroactive credits. They can assist you change previous tax returns to claim these refunds.
Filing Assistance: Companies focusing on ERC filings will prepare and send the necessary types and paperwork in your place. This consists of finishing Form 941 or any other necessary tax return.
Compliance and Updates: ERC policies and guidance have actually progressed over time. These companies stay updated with the latest changes and make sure that your filings adhere to the most existing standards. They can also offer ongoing support if the internal revenue service demands additional information or carries out an audit related to your ERC claim.
It is essential to research study and vet any company providing ERC filing assistance to ensure their trustworthiness and competence. Look for recognized firms with experience in tax and payroll services, or think about reaching out to relied on accounting companies or tax experts who offer ERC filing assistance.
Remember that while these business can offer valuable support, it’s constantly a good concept to have a basic understanding of the ERC requirements and process yourself. This will assist you make informed choices and make sure precise filings.
The Worker Retention Credit (ERC) is a refundable tax credit introduced by the U.S. federal government as part of COVID-19 relief steps. The objective of the ERC is to motivate companies to keep and pay their workers throughout the pandemic, even if their operations have actually been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is readily available to eligible employers, including for-profit services, tax-exempt companies, and certain governmental entities. To certify, companies must satisfy one of two requirements:.
Business operations were completely or partly suspended due to a federal government order related to COVID-19.
The business experienced a substantial decline in gross receipts. As pointed out earlier, for 2021, a considerable decline is specified as a 20% decrease in gross invoices compared to the exact 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% decline in gross receipts 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 amounts to a portion (up to 70%) of certified incomes paid to employees, consisting of particular health plan expenses. 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, businesses that received a Paycheck Protection Program (PPP) loan were not qualified for the ERC. However, legislation passed in late 2020 and extended in 2021 permits companies to declare the ERC even if they received a PPP loan. The exact same wages can not be utilized to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively expanded and boosted, allowing qualified employers to claim the credit for certified earnings paid as far back as March 13, 2020. This retroactive arrangement provides a chance for services to change prior-year tax returns and get refunds.
Claiming the Credit: Employers can claim the ERC by reporting it on their employment tax returns, usually Type 941. If the credit surpasses the amount of employment taxes owed, the excess can be refunded to the company.
It is essential to keep in mind that the ERC arrangements and eligibility criteria have actually evolved in time. The very best strategy is to talk to a tax professional or visit the main internal revenue service site for the most current and comprehensive info relating to the ERC, including any recent legal changes or updates.
To get approved for the ERC, a company must meet one of the following requirements:.
Business operations were fully or partially suspended due to a federal government order related to COVID-19.
The business experienced a substantial decline in gross receipts. For 2021, a considerable decrease is specified as a 20% decline in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a significant decline is defined as a 20% decline in gross invoices compared to the exact same quarter in 2019, or a 20% decline in gross invoices compared to the right away preceding quarter.
The ERC is available to services of all sizes, consisting of tax-exempt companies, but there are some exceptions. For example, federal government entities and services that got a PPP loan might have restrictions on declaring the credit.
The procedure for claiming the ERC includes completing the needed kinds and including the credit on your employment income tax return (normally Kind 941). The exact time it takes to process the credit can vary based upon a number of elements, consisting of the complexity of your business and the workload of the IRS. It’s advised to consult with a tax expert for guidance particular to your scenario.
There are numerous business that can help with the procedure of declaring the ERC. Some popular companies that offer support with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the details supplied here is based on general knowledge and may not reflect the most recent updates or changes to the ERC. It is necessary to seek advice from a tax professional or go to the official IRS site for the most updated and precise info concerning eligibility, declaring procedures, and readily available help.
Less than 100. The credit is based if the employer had 100 or less employees on average in 2019.
on earnings paid to all staff members 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 employer still gets the credit.
Greater than 100. If the company had more than 100 workers on average in 2019, then the credit is.
allowed just for wages paid to employees who did not work throughout the calendar quarter.
In both cases, “earnings” consists of not simply cash payments but likewise a portion of the expense of company.
supplied healthcare. Eligible Employer Employee Retention Credit
Companies can be immediately reimbursed for the credit by reducing the quantity of payroll taxes they.