Lets talk first about Employee Retention Credit 20 Reduction :
Our team here what do these men doing everyone in this room is assisting teach individuals about ERC and uh constantly supply a gorgeous breakfast and have individuals actually learn 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 business and I want to see that what is this this is uh numerous countless dollars literally Kevin hundreds of countless dollars so these are replicate copies of the letters that go to clients validating that the check is on the way I indicate you understand if you just begin to take a look at some of these here I mean this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I mean it’s just I imply think about how many real clients that went through the program yeah this is the very end this is the party at the end when the check is verified the numbers are confirmed and the check is on the mail in the mail from the IRS 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 chosen sure and that’s when they pay so they don’t pay anything till they really receive the cash they do not pay bottom line Wonder trust anything until this letter is validated the check is on the way they transfer it into their checking account and they can genuinely rely on Wonder trust that the procedure has actually been completed and how many you think you’ve processed since you began 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 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 Terrific here you’re at my YouTube channel we’re speaking about something actually crucial today the employee retention credit which the majority of you have never ever become aware of I certainly hadn’t heard of it up until really recently and found out a lot about it since this is probably the lowest cost of capital for any small company anywhere
anytime if you have staff members in 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 not easy 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 inform all of us about it and how to get it and why I’ve become yes the Ambassador and paid representative for this I enjoy this program it’s going away very soon you got to learn all about it let’s talk staff member retention credit Josh Fox what is an ERC let’s simply begin there so during the Trump Administration when President Trump was enacted they developed the cares Act and the cares act offered organizations 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 2 of them are loans and one’s a refund exactly so the ERC is a refund that’s.
fix the cash money payroll tax refund okay go on sorry I just have to ensure we got that point I indicate that’s a big distinction a loan versus cash money I like cash 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 lovely difficult check in the mail where you get actual money from the IRS 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 worker retention credit that individual needed to be an employee so I’m going to make the Assumption this cash is not for the owner not for individuals on the cap table not for shareholders it’s for employees right you needed to have owned a service however it’s based upon you having W-2 staff members 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 first 6 months of 2021 on the W-2 appropriate so there were 6 quarters the program was open well walk 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. 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 get back per staff member 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 escalated to 70 of the worker’s income to an optimum of 7 thousand per quarter how did that occur um they simply changed the rules in.
2021 versus because the mayhem 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 happens 21 000 Max in 2021 oh that’s how you develop 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 great deal 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 minimize the 26 000 so what we’re seeing usually Kevin is if you took PPP cash someplace around 10 thousand dollars an individual so let’s state hypothetically you owned a restaurant 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 huge obviously now the big question is why does nobody learn about this because look when I initially became aware of this when I initially satisfied Josh you understand I’ve got lots of investments in great deals of companies I’m a significant advocate for entrepreneurship in America and make lots of many investments in entrepreneurs of which lots of suffered through the pandemic when I first became aware of 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 deserved and we utilized them wisely to survive during the pandemic so when I became aware of this I said nah it can’t hold true however when I dug around I even called to my political leader buddies Guv Senators they didn’t know about it I suggest that’s how you know that’s how misinformation is that there’s no info out there then a bunch of people told me well you can’t get it since you took the PPP also not true so let’s ask Josh why does nobody understand about the worker retention credit you understand what’s intriguing you’re discussing the banks Kevin due to the fact that 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 process in Canada a pre-pp loan there’s no loans in Canada by the way it’s just process procedure that’s all um and here there was mayhem since keep in mind in the initial cares act you might not do 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 since it’s not alone so you’re getting a tax refund so the federal government never made it clear to any person about how to.
do this does your CFO know how to do this not actually she or he’s never done it in the past 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 company your accountant no your accountant’s never 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 given that 2009 and we have actually 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 big big business clients have worked with bottom line to recover other federal government programs we’ve done sales tax and utilize tax joblessness tax work opportunity 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 encourage.
companies to keep employees on their payroll. The credit is 50% of approximately $10,000 in salaries paid by an.
Due to the fact that of COVID-19 or whose gross invoices, employer whose business is fully or partially suspended.
decline by more than 50%.
Schedule.
1. The credit is available to all companies no matter size including tax exempt companies. There are.
just two exceptions: (1) state and city governments and their instrumentalities and (2) small.
organizations who take Small company Loans.
2. To certify, the employer has to fulfill one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the company’s business is fully or partly suspended by federal government order due to COVID-19.
during the calendar quarter or.
o the employer’s gross receipts are below 50% of the comparable quarter in 2019. When the.
company’s gross receipts exceed 80% of a similar quarter in 2019 they no longer qualify.
after completion of that quarter.
Calculation of the Credit.
The quantity of the credit is 50% of the certifying salaries paid up to $10,000 in total.
It works for incomes paid after March 13th and before December 31, 2020.
The meaning of qualifying wages differs by whether a company had, usually, more or less than.
100 staff members in 2019.
Business that focus on ERC filing assistance usually offer knowledge and support to help organizations navigate the intricate process of declaring the credit. They can offer different services, including:.
How is the employee retention credit calculated? Employee Retention Credit 20 Reduction
Eligibility Assessment: These business will examine your business’s eligibility for the ERC based upon factors such as your industry, profits, and operations. They can help identify if you satisfy the requirements for the credit and determine the optimum credit amount you can claim.
Documentation and Computation: ERC filing services will assist in collecting the needed documentation, such as payroll records and financial statements, to support your claim. They will also assist calculate the credit amount based on eligible wages and other qualifying costs.
Retroactive Claim Review: If you are eligible to claim the ERC for prior quarters, these companies can examine your previous payroll records and financials to determine prospective chances for retroactive credits. They can help you change prior income tax return to declare these refunds.
Filing Assistance: Companies concentrating on ERC filings will prepare and send the needed kinds and documentation in your place. This includes completing Type 941 or any other required tax return.
Compliance and Updates: ERC regulations and assistance have actually progressed over time. These companies remain upgraded with the most recent changes and guarantee that your filings abide by the most present guidelines. If the Internal revenue service demands additional info or carries out an audit related to your ERC claim, they can likewise provide continuous support.
It is very important to research and vet any company providing ERC filing support to ensure their credibility and competence. Look for established firms with experience in tax and payroll services, or consider reaching out to relied on accounting firms or tax specialists who use ERC submitting assistance.
Keep in mind that while these companies can offer valuable assistance, it’s constantly an excellent idea to have a basic understanding of the ERC requirements and process yourself. This will assist you make informed decisions and ensure 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 goal of the ERC is to encourage services to maintain and pay their staff members during the pandemic, even if their operations have actually been impacted.
Here are some key points about the ERC:.
Eligibility: The ERC is readily available to qualified employers, including for-profit companies, tax-exempt companies, and certain governmental entities. To certify, companies must fulfill one of two criteria:.
The business operations were fully or partially suspended due to a government order related to COVID-19.
Business experienced a substantial decline in gross invoices. As discussed previously, for 2021, a substantial decline is defined as a 20% decrease in gross receipts compared to the 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% decrease in gross receipts compared to the right away 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 (approximately 70%) of certified earnings paid to workers, consisting of specific health plan 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, companies that received an Income Defense 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 very same wages can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively broadened and boosted, permitting qualified companies to declare the credit for qualified incomes paid as far back as March 13, 2020. This retroactive arrangement provides an opportunity for services to change prior-year income tax return and receive refunds.
Declaring the Credit: Companies can declare the ERC by reporting it on their work tax returns, usually Form 941. If the credit surpasses the amount of employment taxes owed, the excess can be reimbursed to the company.
It is very important to note that the ERC provisions and eligibility requirements have developed gradually. The very best strategy is to consult with a tax professional or check out the main IRS website for the most current and detailed details relating to the ERC, consisting of any current legal modifications or updates.
To receive the ERC, a company must fulfill among the following criteria:.
The business operations were completely or partially suspended due to a federal government order related to COVID-19.
The business experienced a substantial decrease in gross receipts. For 2021, a considerable decrease is defined as a 20% decrease 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 invoices compared to the exact same quarter in 2019, or a 20% decrease in gross receipts compared to the instantly preceding quarter.
The ERC is offered to services of all sizes, consisting of tax-exempt companies, but there are some exceptions. Government entities and companies that got a PPP loan might have limitations on claiming the credit.
The procedure for declaring the ERC includes completing the necessary kinds and including the credit on your work tax return (typically Form 941). The exact time it takes to process the credit can differ based on a number of elements, including the intricacy of your company and the workload of the IRS. It’s recommended to consult with a tax professional for guidance particular to your situation.
There are several companies that can assist with the procedure of claiming the ERC. These consist of accounting companies, tax advisory services, and payroll company. Some popular companies that provide assistance with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s a good idea to research and contact these companies straight to ask about their charges and services.
Please note that the info supplied here is based on general knowledge and may not reflect the most current updates or changes to the ERC. It’s important to speak with a tax expert or visit the official internal revenue service site for the most updated and accurate info concerning eligibility, declaring procedures, and offered help.
Less than 100. The credit is based if the company had 100 or less workers on average in 2019.
on wages paid to all staff members whether they in fact worked or not. Simply put, even if the.
workers 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.
enabled just for incomes paid to staff members who did not work throughout the calendar quarter.
In both cases, “incomes” consists of not just money payments but likewise a part of the expense of company.
supplied healthcare. Employee Retention Credit 20 Reduction
Payment.
Employers can be instantly reimbursed for the credit by decreasing the amount of payroll taxes they.