Lets talk first about Employee Retention Credit 2021 Quarter 3 :
Our team here what do these guys doing everybody in this room is assisting teach individuals about ERC and uh constantly offer a beautiful breakfast and have individuals truly discover the program we should head to the room where we are able to show 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 countless dollars literally Kevin numerous countless dollars so these are duplicate copies of the letters that go to clients confirming that the check is on the method I indicate you know if you just start to 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 suggest it’s just I indicate think about the number of real 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 know when you
receive this you know the check is chosen sure and that’s when they pay so they do not pay anything until they in fact receive the money they don’t pay bottom line Wonder trust anything until this letter is verified the check is on the method they deposit it into their checking account and they can genuinely trust Wonder trust that the process has actually been finished and how many you believe you have actually processed considering that you started this we’re about 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 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 Fantastic here you’re at my YouTube channel we’re speaking about something actually important today the worker retention credit which the majority of you have never ever become aware of I certainly had not become aware 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 staff members in between five and five hundred so I have actually got the professional with me this is Josh Fox he’s the creator and CEO of bottom line Ideas they’re the biggest processor of these ERC credits this is a 170 page program so it’s challenging this isn’t like PPP we just phone your bank supervisor and say offer me a loan it does not 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 representative for this I enjoy this program it’s disappearing very soon you got to find out all about it let’s talk employee retention credit Josh Fox what is an ERC let’s just begin there so during the Trump Administration when President Trump was enacted they came up with the cares Act and the cares act offered services 3 chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically everyone it makes a big difference right there 2 of them are loans and one’s a refund exactly so the ERC is a refund that’s.
remedy the money money payroll tax refund fine go on sorry I just need to make certain we got that point I indicate that’s a big distinction a loan versus cash money I like money money that’s what we’re speaking about fine 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 stunning tough check in the mail where you get real 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 employee retention credit that person had to be an employee so I’m going to make the Assumption this money is not for the owner not for people on the cap table not for investors it’s for workers right you had to have actually owned an organization but it’s based upon you having W-2 staff members in America not 10.99. so as long as you had W-2 staff members and you paid federal payroll taxes that’s why you would be eligible so you need to be on payroll in 2020 on the W-2 and you need to be on payroll for the very first six 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 two three and 4 of 2020 and you had quarters one 2 and three of 2021. all right so that’s how it’s determined you have to be on the W-2 during that period now let’s talk my favorite part cash how much can you get back per worker that was on a W-2 in those 6 quarters so the computation in 2020 to be precise Kevin is 50 of the staff member’s salary to an optimum of 5 thousand dollars per employee for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the staff member’s salary to an optimum of 7 thousand per quarter how did that take place um they just altered the rules in.
2021 versus because the turmoil of the pandemic so they wished 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 as much as 5 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 5 thousand in twenty twenty that’s twenty six thousand dollars per staff member that is because that’s a great deal of cash it is now there’s a caution here the PPP money would have to be decreased from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan 2 you would decrease the 26 000 so what we’re seeing usually 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 obviously now the big question is why does no one learn about this since look when I first heard about this when I first satisfied Josh you understand I have actually got lots of financial investments in great deals of companies I’m a significant supporter for entrepreneurship in America and make numerous lots of investments in entrepreneurs of which lots of suffered through the pandemic when I initially became aware of this I called BS I don’t believe it because I use 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 stay alive throughout the pandemic so when I found out about this I stated 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 mean that’s how you know that’s how false information is that there’s no details out there then a lot of people told me well you can’t get it due to the fact that you took the PPP likewise not real so let’s ask Josh why does nobody learn about the staff member retention credit you understand what’s interesting you’re discussing the banks Kevin due to the fact that in the PPP loan procedure the federal government made it extremely 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 just procedure process that’s all um and here there was chaos since keep in mind in the initial cares act you might not do both programs so if you had actually done PPP you might not do 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 anyone about how to.
do this does your CFO know how to do this not actually she or he’s never ever done it previously do the banks do it nope the banks don’t 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 entered into this business and bottom line my firm Kevin has actually been in business considering that 2009 and we have actually been dealing with the federal government and the state government to recover cash for Fortune 500 Fortune 1000 companies so a lot of our big big business clients have dealt with bottom line to recover other federal government programs we’ve done sales tax and utilize tax joblessness tax work chance tax credits research and development tax credits unclaimed property property tax all of these other government programs.
The staff member retention tax credit is a broad based refundable tax credit developed to encourage.
employers to keep employees on their payroll. The credit is 50% of approximately $10,000 in incomes paid by an.
company whose business is fully or partly suspended because of COVID-19 or whose gross receipts.
decrease by more than 50%.
1. The credit is offered to all employers despite size including tax exempt organizations. There are.
only 2 exceptions: (1) state and local governments and their instrumentalities and (2) little.
services who take Small Business Loans.
2. To qualify, the employer needs to fulfill one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the company’s service is totally or partly suspended by federal government order due to COVID-19.
throughout the calendar quarter or.
o the employer’s gross receipts are listed below 50% of the similar quarter in 2019. Once the.
employer’s gross receipts go above 80% of an equivalent quarter in 2019 they no longer certify.
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 overall.
It works for salaries paid after March 13th and prior to December 31, 2020.
The definition of qualifying earnings varies by whether a company had, usually, basically than.
100 staff members in 2019.
Business that concentrate on ERC filing support normally offer knowledge and assistance to help services navigate the intricate process of claiming the credit. They can provide different services, including:.
How is the employee retention credit calculated? Employee Retention Credit 2021 Quarter 3
Eligibility Evaluation: These companies will assess your company’s eligibility for the ERC based upon elements such as your market, income, and operations. If you satisfy the requirements for the credit and recognize the optimum credit amount you can claim, they can help identify.
Documentation and Estimation: ERC filing services will assist in gathering the essential documentation, such as payroll records and monetary declarations, to support your claim. They will also assist calculate the credit quantity based upon qualified incomes and other qualifying expenses.
Retroactive Claim Evaluation: If you are qualified to declare the ERC for previous quarters, these business can review your previous payroll records and financials to recognize prospective chances for retroactive credits. They can help you change prior income tax return to claim these refunds.
Filing Assistance: Business focusing on ERC filings will prepare and submit the necessary kinds and documents in your place. This consists of completing Type 941 or any other required tax forms.
Compliance and Updates: ERC guidelines and assistance have actually progressed in time. These companies stay updated with the latest changes and ensure that your filings abide by the most present guidelines. If the Internal revenue service requests additional details or carries out an audit associated to your ERC claim, they can likewise supply ongoing assistance.
It is essential to research study and veterinarian any company providing ERC filing help to guarantee their credibility and proficiency. Search for established companies with experience in tax and payroll services, or think about reaching out to relied on accounting firms or tax specialists who offer ERC filing support.
Remember that while these companies can supply valuable help, it’s always a good concept to have a fundamental understanding of the ERC requirements and process yourself. This will help you make informed choices and ensure accurate filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit presented by the U.S. federal government as part of COVID-19 relief measures. The goal of the ERC is to motivate services to keep and pay their employees throughout the pandemic, even if their operations have actually been affected.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is readily available to eligible companies, including for-profit services, tax-exempt organizations, and particular governmental entities. To certify, companies must fulfill one of two criteria:.
Business operations were fully or partially suspended due to a federal government order related to COVID-19.
The business experienced a significant decline in gross receipts. As mentioned previously, for 2021, a substantial decline is specified as a 20% decrease in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a significant decline is specified as a 20% decrease in gross receipts compared to the exact 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 company’s share of Social Security taxes. The credit amount is equal to a percentage (approximately 70%) of qualified earnings paid to workers, including certain health insurance costs. The maximum credit per staff member 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 Defense Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 permits companies to claim the ERC even if they got a PPP loan. The very same incomes can not be utilized to claim both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has actually been retroactively broadened and boosted, allowing qualified companies to declare the credit for certified incomes paid as far back as March 13, 2020. This retroactive provision provides a chance for organizations to amend prior-year tax returns and get refunds.
Claiming the Credit: Employers can declare the ERC by reporting it on their work tax returns, usually Kind 941. The excess can be refunded to the company if the credit exceeds the quantity of employment taxes owed.
It is essential to keep in mind that the ERC arrangements and eligibility requirements have actually evolved gradually. The very best course of action is to talk to a tax professional or check out the official internal revenue service website for the most comprehensive and up-to-date info relating to the ERC, consisting of any recent legislative modifications or updates.
To get approved for the ERC, a company must satisfy one of the following requirements:.
The business operations were completely 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 significant decrease 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 receipts compared to the very same quarter in 2019, or a 20% decrease in gross invoices compared to the instantly preceding quarter.
The ERC is available to organizations of all sizes, consisting of tax-exempt organizations, but there are some exceptions. Federal government entities and services that received a PPP loan might have limitations on declaring the credit.
The process for claiming the ERC involves completing the required kinds and including the credit on your employment income tax return (typically Kind 941). The exact time it takes to process the credit can vary based on several elements, including the intricacy of your service and the work of the internal revenue service. It’s advised to speak with a tax professional for assistance specific to your circumstance.
There are several business that can assist with the procedure of declaring the ERC. These include accounting companies, tax advisory services, and payroll provider. Some widely known business that use help with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s recommended to research study and get in touch with these companies directly to ask about their services and charges.
Please keep in mind that the information supplied here is based upon basic knowledge and might not reflect the most current updates or changes to the ERC. It’s important to talk to a tax expert or go to the main internal revenue service site for the most accurate and updated information concerning eligibility, declaring procedures, and available assistance.
Less than 100. If the employer had 100 or less employees usually in 2019, then the credit is based.
on incomes paid to all workers whether they actually worked or not. Simply put, even if the.
employees worked full-time and got paid for full time work, the employer still gets the credit.
Greater than 100. If the employer had more than 100 workers on average in 2019, then the credit is.
enabled only for earnings paid to staff members who did not work during the calendar quarter.
In both cases, “salaries” consists of not just money payments but also a portion of the cost of company.
provided healthcare. Employee Retention Credit 2021 Quarter 3
Employers can be right away compensated for the credit by minimizing the quantity of payroll taxes they.