Lets talk first about Employee Retention Credit And Eidl :
Our group here what do these guys doing everyone in this space is helping teach people about ERC and uh constantly offer a stunning breakfast and have individuals actually learn about the program we need to head to the room where we are able to show some 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 actually Kevin hundreds of millions of dollars so these are replicate copies of the letters that go to customers validating that the check is on the method I mean you know if you simply begin 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 indicate it’s just I mean think of the number of real clients 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 validated and the check is on the mail in the mail from the IRS heading to the customer so that’s how you have the ability to track it you understand when you
get this you know the check is chosen sure which’s when they pay so they don’t pay anything until they actually get the money they do not pay bottom line Wonder trust anything up until this letter is validated the check is on the way they deposit it into their bank account and they can truly trust Wonder trust that the process has been completed and how many you think you’ve processed because you started this we’re about 35 000 of these for
about six billion dollars wow so plainly they know what they’re doing and that’s what you require 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 discussing something actually essential today the worker retention credit which most of you have actually never heard of I certainly hadn’t heard of it till really just recently and found out a lot about it since this is most likely the most affordable cost of capital for any small company anywhere
anytime if you have staff members between five 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 hard this isn’t like PPP we simply phone your bank manager and say give me a loan it doesn’t 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 spokesperson for this I like this program it’s going away soon you got to discover everything about it let’s talk staff member 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 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 precisely so the ERC is a refund that’s.
remedy the cash money payroll tax refund all right go on sorry I simply need to ensure we got that point I indicate that’s a big distinction a loan versus money cash I like money money that’s what we’re speaking 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 beautiful difficult check in the mail where you get actual money from the internal revenue service all right so let’s discuss how it works due to the fact that it sounds like to me if it’s a if it’s worker retention credit that person had to be an employee so I’m going to make the Presumption this cash is not for the owner not for people on the cap table not for investors it’s for workers right you needed to have actually owned a company 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 qualified so you have to be on payroll in 2020 on the W-2 and you have to be on payroll for the very first 6 months of 2021 on the W-2 correct so there were 6 quarters the program was open well walk us through the six quarters so you had quarters 2 3 and four of 2020 and you had quarters one 2 and three of 2021. all right so that’s how it’s measured you have to be on the W-2 throughout that period now let’s talk my favorite part money 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 precise Kevin is 50 of the staff member’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 staff member’s wage to a maximum of 7 thousand per quarter how did that take place um they just altered the rules in.
2021 versus because 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 as much as 5 thousand Max and then what happens 21 000 Max in 2021 oh that’s how you come up with twenty six thousand twenty one thousand to twenty twenty one plus five thousand in twenty twenty that’s twenty 6 thousand dollars per staff member that is since that’s a great deal of money it is now there’s a caveat here the PPP cash would need to be minimized from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan 2 you would lower the 26 000 so what we’re seeing on average Kevin is if you took PPP cash somewhere around 10 thousand dollars a person so let’s state hypothetically you owned a dining establishment in New York 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 substantial clearly now the big concern is why does nobody understand about this due to the fact that appearance when I initially became aware of this when I first met Josh you know I’ve got lots of financial investments in great deals of business I’m a significant advocate for entrepreneurship in America and make numerous lots of investments in entrepreneurs of which lots of suffered through the pandemic when I first heard about this I called BS I don’t think 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 deserved and we used them wisely to survive during the pandemic so when I became aware of this I stated nah it can’t be true but when I dug around I even called to my politician friends Governor Senators they didn’t learn about it I imply that’s how you understand 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 employee 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 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 procedure procedure that’s all um and here there was chaos since keep in mind in the initial cares act you might 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 because it’s not alone so you’re getting a tax refund so the government never ever made it clear to anyone about how to.
do this does your CFO understand how to do this not truly he or she’s never ever done it previously do the banks do it nope the banks do not do it the payroll companies yeah some of them are doing it as a payroll company your accounting professional no your accountant’s never done this before unless you have an account that went into this company and bottom line my firm Kevin has stayed in business considering that 2009 and we’ve been working with the federal government and the state government to recuperate cash for Fortune 500 Fortune 1000 business so a great deal of our huge big corporate clients have actually 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 home property tax all of these other federal government programs.
The employee retention tax credit is a broad based refundable tax credit created to motivate.
companies to keep workers on their payroll. The credit is 50% of as much as $10,000 in salaries paid by an.
company whose business is completely or partially suspended because of COVID-19 or whose gross receipts.
decrease by more than 50%.
1. The credit is available to all companies regardless of size consisting of tax exempt companies. There are.
only two exceptions: (1) state and city governments and their instrumentalities and (2) little.
businesses who take Small company Loans.
2. To certify, the company has to meet one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the company’s company is completely or partially suspended by federal government order due to COVID-19.
during the calendar quarter or.
o the company’s gross invoices are below 50% of the similar quarter in 2019. When the.
employer’s gross receipts exceed 80% of a similar quarter in 2019 they no longer qualify.
after the end of that quarter.
Estimation of the Credit.
The amount of the credit is 50% of the certifying earnings paid up to $10,000 in overall.
It is effective for earnings paid after March 13th and before December 31, 2020.
The meaning of certifying salaries varies by whether a company had, on average, basically than.
100 workers in 2019.
Companies that focus on ERC filing assistance generally provide know-how and assistance to help services browse the complicated procedure of claiming the credit. They can offer various services, including:.
How is the employee retention credit calculated? Employee Retention Credit And Eidl
Eligibility Assessment: These companies will assess your business’s eligibility for the ERC based upon elements such as your market, income, and operations. If you fulfill the requirements for the credit and determine the optimum credit amount you can claim, they can assist determine.
Paperwork and Computation: ERC filing services will help in gathering the necessary documentation, such as payroll records and financial statements, to support your claim. They will also assist determine the credit quantity based upon qualified earnings and other qualifying expenses.
Retroactive Claim Review: If you are qualified to declare the ERC for previous quarters, these companies can examine your previous payroll records and financials to identify potential chances for retroactive credits. They can help you amend previous income tax return to declare these refunds.
Filing Assistance: Business concentrating on ERC filings will prepare and send the required kinds and documents on your behalf. This consists of completing Type 941 or any other required tax forms.
Compliance and Updates: ERC policies and guidance have actually evolved in time. These companies stay updated with the most recent modifications and guarantee that your filings abide by the most present guidelines. If the Internal revenue service requests extra information or conducts an audit related to your ERC claim, they can also offer continuous assistance.
It is very important to research study and vet any business offering ERC filing assistance to ensure their trustworthiness and know-how. Look for recognized companies with experience in tax and payroll services, or consider connecting to trusted accounting firms or tax professionals who use ERC filing support.
Bear in mind that while these companies can supply important support, it’s always an excellent idea to have a standard understanding of the ERC requirements and process yourself. This will help you make informed decisions and make sure 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 steps. The goal of the ERC is to motivate organizations to retain and pay their workers throughout the pandemic, even if their operations have actually been impacted.
Here are some key points about the ERC:.
Eligibility: The ERC is offered to eligible companies, consisting of for-profit services, tax-exempt organizations, and certain governmental entities. To qualify, companies must fulfill one of two criteria:.
Business operations were totally or partly suspended due to a government order related to COVID-19.
The business experienced a substantial decrease in gross receipts. As mentioned earlier, 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 substantial decline is specified as a 20% decrease in gross receipts compared to the very same quarter in 2019, or a 20% decline in gross receipts compared to the right away preceding quarter.
Credit Amount: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit quantity amounts to a percentage (as much as 70%) of qualified salaries paid to staff members, consisting of certain health plan costs. 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, companies that received a Paycheck Security Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 permits organizations to declare the ERC even if they received a PPP loan. Nevertheless, the exact same incomes can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively broadened and boosted, allowing eligible companies to claim the credit for qualified salaries paid as far back as March 13, 2020. This retroactive arrangement offers a chance for services to modify prior-year income tax return and get refunds.
Claiming the Credit: Employers can claim the ERC by reporting it on their work tax returns, usually Form 941. If the credit goes beyond the quantity of work taxes owed, the excess can be reimbursed to the company.
It’s important to note that the ERC provisions and eligibility requirements have developed gradually. The best course of action is to consult with a tax expert or visit the main IRS site for the most in-depth and up-to-date info regarding the ERC, consisting of any recent legal changes or updates.
To get approved for the ERC, a service must fulfill one of the following requirements:.
Business operations were completely or partly 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 defined as a 20% decline in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a considerable decrease 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 immediately preceding quarter.
The ERC is readily available to services of all sizes, including tax-exempt organizations, but there are some exceptions. Federal government entities and businesses that received a PPP loan might have constraints on claiming the credit.
The process for declaring the ERC involves finishing the required forms and consisting of the credit on your employment tax return (generally Form 941). The exact time it takes to process the credit can differ based on a number of aspects, including the intricacy of your company and the workload of the internal revenue service. It’s recommended to consult with a tax expert for guidance particular to your situation.
There are numerous companies that can help with the procedure of declaring the ERC. Some well-known business that offer help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the info provided here is based upon basic knowledge and may not reflect the most current updates or changes to the ERC. It’s important to seek advice from a tax expert or visit the main internal revenue service website for the most updated and accurate info regarding eligibility, claiming treatments, and readily available help.
Less than 100. If the employer had 100 or fewer employees typically in 2019, then the credit is based.
on salaries paid to all staff members whether they really worked or not. In other words, even if the.
staff members worked full time and made money for full time work, the employer still gets the credit.
Greater than 100. If the employer had more than 100 staff members typically in 2019, then the credit is.
allowed only for earnings paid to workers who did not work throughout the calendar quarter.
In both cases, “wages” consists of not just money payments however likewise a portion of the cost of company.
offered health care. Employee Retention Credit And Eidl
Companies can be right away reimbursed for the credit by reducing the quantity of payroll taxes they.