Lets talk first about Employee Retention Credit 2020 :
Our team here what do these men doing everyone in this space is helping teach individuals about ERC and uh constantly supply a beautiful breakfast and have people actually learn more about the program we ought to head to the room where we are able to display a few of the checks that we are getting for business and I ‘d like to see that what is this this is uh hundreds of countless dollars literally Kevin numerous countless dollars so these are duplicate copies of the letters that go to clients validating that the check is on the way I indicate you know if you just begin to take a look at some of these here I imply this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I indicate it’s just I mean think of how many real customers 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 till they actually receive the cash they do not pay bottom line Wonder trust anything till this letter is verified the check is on the method they transfer it into their savings account and they can really trust Wonder trust that the procedure has actually been completed and how many you believe you’ve processed because you started this we have to do with 35 000 of these for
about six billion dollars wow so plainly they understand what they’re doing and that’s what you need you require professionals 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 Wonderful 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 actually never heard of I definitely had not become aware of it until very recently and learned a lot about it because this is most likely the lowest cost of capital for any small business anywhere
anytime if you have employees between 5 and five hundred so I’ve got the expert with me this is Josh Fox he’s the founder and CEO of bottom line Concepts 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 call your bank supervisor and state provide me a loan it doesn’t work there’s not a loan it’s an application and Josh is going to inform us all about it and how to get it and why I’ve become yes the Ambassador and paid spokesperson for this I like this program it’s disappearing soon you got to learn everything about it let’s talk staff member retention credit Josh Fox what is an ERC let’s simply begin there so throughout the Trump Administration when President Trump was enacted they developed the cares Act and the cares act offered services three chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically everybody it makes a huge difference right there two of them are loans and one’s a refund precisely so the ERC is a refund that’s.
fix the money cash payroll tax refund alright go on sorry I simply need to ensure we got that point I suggest that’s a huge distinction a loan versus cash cash I like cash money that’s what we’re talking about 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 real money from the internal revenue service all right so let’s discuss how it works because it sounds like to me if it’s a if it’s worker retention credit that person needed to be an employee so I’m going to make the Presumption this money is not for the owner not for individuals on the cap table not for investors it’s for employees right you needed to have owned a company 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 need to be on payroll in 2020 on the W-2 and you need to be on payroll for the first 6 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 two 3 and four of 2020 and you had quarters one two and 3 of 2021. alright so that’s how it’s determined you have to be on the W-2 during that period now let’s talk my preferred part cash just how much can you return per employee that was on a W-2 in those six quarters so the estimation in 2020 to be exact Kevin is 50 of the employee’s wage to an optimum 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 a maximum of seven thousand per quarter how did that happen um they simply changed the rules in.
2021 versus because the turmoil of the pandemic so they wanted 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 after that what happens 21 000 Max in 2021 oh that’s how you create twenty 6 thousand twenty one thousand to twenty twenty one plus five 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 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 typically Kevin is if you took PPP money someplace around 10 thousand dollars an individual so let’s say 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 internal revenue service so it’s huge obviously now the big concern is why does no one learn about this since look when I initially became aware of this when I initially satisfied Josh you understand I’ve got lots of financial investments in lots of business I’m a major supporter for entrepreneurship in America and make lots of numerous investments in entrepreneurs of which many suffered through the pandemic when I first heard about this I called BS I do not think 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 should have and we used them wisely to survive during 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 politician friends Guv Senators they didn’t learn about it I indicate that’s how you understand that’s how false information 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 real so let’s ask Josh why does no one understand about the employee retention credit you understand what’s intriguing you’re speaking about the banks Kevin due to the fact that in the PPP loan procedure 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 country and they would process process in Canada a pre-pp loan there’s no loans in Canada by the way it’s simply process procedure that’s all um and here there was chaos due to the fact that keep in mind in the original 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 because it’s not alone so you’re getting a tax refund so the federal government never made it clear to anybody about how to.
do this does your CFO understand how to do this not truly 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 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 entered into this organization and bottom line my company Kevin has been 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 business so a lot of our big big corporate customers have worked with bottom line to recuperate other government programs we have actually done sales tax and use tax joblessness tax work chance tax credits research and development tax credits unclaimed home real estate tax all of these other federal government programs.
The staff member retention tax credit is a broad based refundable tax credit developed to motivate.
employers to keep staff members on their payroll. The credit is 50% of approximately $10,000 in incomes paid by an.
employer whose service is fully or partly suspended because of COVID-19 or whose gross invoices.
decline by more than 50%.
Accessibility.
1. The credit is offered to all companies regardless of size consisting of tax exempt companies. There are.
just 2 exceptions: (1) state and local governments and their instrumentalities and (2) small.
businesses who take Small company Loans.
2. To certify, the employer has to satisfy one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the company’s business is completely or partially suspended by government order due to COVID-19.
during the calendar quarter or.
o the company’s gross receipts are listed below 50% of the equivalent quarter in 2019. As soon as the.
company’s gross receipts go above 80% of a similar quarter in 2019 they no longer qualify.
after completion of that quarter.
Estimation of the Credit.
The amount of the credit is 50% of the qualifying salaries paid up to $10,000 in overall.
It is effective for wages paid after March 13th and before December 31, 2020.
The definition of certifying salaries varies by whether a company had, usually, basically than.
100 employees in 2019.
Companies that focus on ERC filing support generally offer know-how and assistance to help organizations navigate the intricate procedure of claiming the credit. They can use various services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit 2020
Eligibility Assessment: These business will examine your business’s eligibility for the ERC based on aspects such as your market, profits, and operations. If you meet the requirements for the credit and recognize the maximum credit amount you can declare, they can assist determine.
Documents and Calculation: ERC filing services will assist in gathering the necessary documents, such as payroll records and monetary declarations, to support your claim. They will likewise help determine the credit quantity based on qualified salaries and other certifying expenditures.
Retroactive Claim Review: If you are eligible to claim the ERC for prior quarters, these companies can evaluate your past payroll records and financials to recognize potential opportunities for retroactive credits. They can assist you amend prior tax returns to claim these refunds.
Filing Support: Companies focusing on ERC filings will prepare and send the required kinds and paperwork in your place. This consists of completing Kind 941 or any other necessary tax forms.
Compliance and Updates: ERC policies and assistance have actually evolved with time. These companies remain updated with the latest modifications and make sure that your filings comply with the most current guidelines. If the Internal revenue service requests extra details or carries out an audit associated to your ERC claim, they can likewise supply ongoing support.
It is very important to research and vet any company offering ERC filing help to guarantee their reliability and know-how. Search for recognized companies with experience in tax and payroll services, or think about reaching out to trusted accounting firms or tax specialists who use ERC submitting support.
Bear in mind that while these business can offer valuable support, it’s always a great concept to have a standard understanding of the ERC requirements and procedure yourself. This will assist you make informed decisions and ensure precise filings.
The Employee Retention Credit (ERC) is a refundable tax credit introduced by the U.S. federal government as part of COVID-19 relief measures. The objective of the ERC is to encourage businesses to retain and pay their workers throughout the pandemic, even if their operations have been impacted.
Here are some key points about the ERC:.
Eligibility: The ERC is offered to qualified companies, consisting of for-profit organizations, tax-exempt companies, and specific governmental entities. To certify, employers must meet one of two requirements:.
The business operations were completely or partially suspended due to a federal government order related to COVID-19.
The business experienced a significant decrease in gross receipts. As pointed out earlier, for 2021, a considerable decrease is specified as a 20% decrease in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a significant decline is specified as a 20% decline in gross invoices compared to the same quarter in 2019, or a 20% decline in gross invoices compared to the immediately preceding quarter.
Credit Amount: The ERC is a refundable tax credit that offsets the employer’s share of Social Security taxes. The credit quantity is equal to a percentage (approximately 70%) of certified salaries paid to staff members, consisting of particular health plan expenditures. The maximum credit per worker is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, services that received an Income Protection Program (PPP) loan were not qualified for the ERC. However, legislation passed in late 2020 and extended in 2021 allows businesses to declare the ERC even if they received a PPP loan. Nevertheless, the same wages can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively expanded and improved, allowing eligible companies to declare the credit for qualified wages paid as far back as March 13, 2020. This retroactive arrangement offers an opportunity for organizations to change prior-year tax returns and receive refunds.
Claiming the Credit: Employers can declare the ERC by reporting it on their employment tax returns, typically Kind 941. If the credit surpasses the amount of work taxes owed, the excess can be reimbursed to the employer.
It is necessary to keep in mind that the ERC provisions and eligibility criteria have actually progressed with time. The best strategy is to consult with a tax expert or go to the main internal revenue service website for the most comprehensive and up-to-date details relating to the ERC, including any current legislative modifications or updates.
To qualify for the ERC, a service needs to fulfill among the following requirements:.
The business operations were completely or partially suspended due to a government order related to COVID-19.
The business experienced a considerable decrease in gross receipts. For 2021, a considerable decline is specified as a 20% decline in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a considerable decrease is specified as a 20% decline in gross invoices compared to the same quarter in 2019, or a 20% decrease in gross receipts compared to the instantly preceding quarter.
The ERC is readily available to businesses of all sizes, including tax-exempt organizations, however there are some exceptions. For example, federal government entities and organizations that received a PPP loan might have constraints on declaring the credit.
The process for declaring the ERC includes finishing the required types and including the credit on your employment tax return (normally Type 941). The exact time it requires to process the credit can differ based on numerous factors, including the complexity of your company and the workload of the IRS. It’s suggested to seek advice from a tax professional for guidance specific to your scenario.
There are numerous business that can assist with the process of declaring the ERC. Some popular business that use help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the details supplied here is based upon general understanding and might not show the most recent updates or modifications to the ERC. It is necessary to consult with a tax expert or go to the main internal revenue service website for the most precise and current information concerning eligibility, declaring treatments, and readily available help.
Less than 100. If the employer had 100 or less employees on average in 2019, then the credit is based.
on salaries paid to all workers whether they actually worked or not. In other words, even if the.
workers worked full-time and made money for full time work, the company still gets the credit.
Greater than 100. If the company had more than 100 employees usually in 2019, then the credit is.
permitted only for salaries paid to workers who did not work during the calendar quarter.
In both cases, “earnings” includes not simply cash payments but likewise a portion of the expense of company.
supplied healthcare. Employee Retention Credit 2020
Payment.
Companies can be immediately repaid for the credit by lowering the amount of payroll taxes they.