Lets talk first about Employee Retention Credit And Ppp2 :
Our group here what do these men doing everybody in this room is helping teach individuals about ERC and uh always offer a beautiful breakfast and have people really learn about the program we need to head to the space where we are able to show some of the checks that we are getting for business and I want to see that what is this this is uh hundreds of countless dollars actually Kevin hundreds of countless dollars so these are replicate copies of the letters that go to clients confirming that the check is on the method I mean you know if you simply begin to 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 indicate it’s just I mean consider 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 confirmed 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’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 don’t pay anything up until they actually receive the cash they do not pay bottom line Wonder trust anything till this letter is validated the check is on the method they deposit it into their bank account and they can really trust Wonder trust that the procedure has been completed and how many you think you’ve processed since you began this we have to do with 35 000 of these for
about 6 billion dollars wow so plainly they understand 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 among these that’s what matters all right Mr Terrific here you’re at my YouTube channel we’re discussing something actually important today the employee retention credit which most of you have never become aware of I definitely had not heard of it up until very just recently and found out a lot about it due to the fact that this is most likely the most affordable expense of capital for any small company anywhere
anytime if you have staff members 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 supervisor and state offer 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 have actually become yes the Ambassador and paid spokesperson for this I like this program it’s going away very soon you got to discover everything about it let’s talk employee retention credit Josh Fox what is an ERC let’s just begin there so throughout the Trump Administration when President Trump was enacted they came up with the cares Act and the cares act provided companies 3 chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly everyone 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 money money payroll tax refund fine go on sorry I just need to make sure we got that point I indicate that’s a big difference a loan versus money money I like money 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 lovely difficult check in the mail where you get actual money from the IRS all right so let’s talk 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 a worker so I’m going to make the Presumption this cash is not for the owner not for individuals on the cap table not for investors it’s for workers right you needed to have actually owned a business 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 qualified so you have to be on payroll in 2020 on the W-2 and you need to be on payroll for the first six months of 2021 on the W-2 right so there were six quarters the program was open well walk us through the 6 quarters so you had quarters 2 3 and 4 of 2020 and you had quarters one 2 and three of 2021. fine 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 money how much can you get back per worker 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 income to an optimum of 5 thousand dollars per employee for the year of 2020 and in 2021 the numbers increased to 70 of the staff member’s income to a maximum of seven thousand per quarter how did that occur um they just altered the rules in.
2021 versus due to the fact that the turmoil of the pandemic so they wanted to even get more to keep those employees 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 takes place 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 6 thousand dollars per employee that is because that’s a great deal of cash it is now there’s a caveat here the PPP money would need to be minimized from the twenty six thousand dollars so if you took PPP loan one and PPP loan two you would decrease the 26 000 so what we’re seeing typically Kevin is if you took PPP money somewhere around ten thousand dollars a person so let’s state hypothetically you owned a restaurant in New York 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 IRS so it’s substantial undoubtedly now the big concern is why does no one understand about this since look when I first heard about this when I first met Josh you know I have actually got lots of financial investments in great deals of business I’m a major supporter for entrepreneurship in America and make numerous lots of investments in business owners of which numerous suffered through the pandemic when I initially became aware of this I called BS I do not believe it due to the fact that I use 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 used them wisely to survive throughout the pandemic so when I heard about this I said nah it can’t hold true however when I dug around I even contacted us to my politician pals Governor Senators they didn’t know about it I suggest that’s how you know that’s how false information is that there’s no information out there then a bunch of people told me well you can’t get it because you took the PPP likewise not true so let’s ask Josh why does no one know about the worker retention credit you understand what’s fascinating you’re speaking about the banks Kevin since 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 huge banks in our country and they would process procedure 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 turmoil due to the fact that keep in mind in the original 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 altered the law in 2021 the banks were not doing ERC since 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 know how to do this not really she or he’s never done it previously 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 service and bottom line my firm Kevin has stayed in business because 2009 and we’ve been dealing with the federal government and the state government to recover money for Fortune 500 Fortune 1000 business so a great deal of our big big corporate clients have actually dealt with bottom line to recover other government programs we have actually done sales tax and use tax unemployment tax work opportunity 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 designed to motivate.
employers to keep staff members on their payroll. The credit is 50% of as much as $10,000 in earnings paid by an.
company whose service is completely or partially suspended because of COVID-19 or whose gross receipts.
decline by more than 50%.
1. The credit is offered to all employers no matter size including tax exempt organizations. There are.
just two exceptions: (1) state and local governments and their instrumentalities and (2) small.
companies who take Small Business Loans.
2. To qualify, the company has to satisfy one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the employer’s company is fully or partially suspended by federal government order due to COVID-19.
during the calendar quarter or.
o the employer’s gross invoices are below 50% of the comparable quarter in 2019. Once the.
company’s gross receipts exceed 80% of an equivalent quarter in 2019 they no longer certify.
after completion of that quarter.
Estimation of the Credit.
The amount of the credit is 50% of the certifying incomes paid up to $10,000 in total.
It is effective for wages paid after March 13th and prior to December 31, 2020.
The definition of certifying earnings differs by whether an employer had, on average, more or less than.
100 employees in 2019.
Business that concentrate on ERC filing support usually provide know-how and assistance to assist services navigate the intricate procedure of declaring the credit. They can provide different services, including:.
How is the employee retention credit calculated? Employee Retention Credit And Ppp2
Eligibility Assessment: These business will examine your organization’s eligibility for the ERC based upon factors such as your market, profits, and operations. They can help determine if you meet the requirements for the credit and recognize the maximum credit quantity you can declare.
Documentation and Computation: ERC filing services will assist in gathering the essential documentation, such as payroll records and financial statements, to support your claim. They will also assist calculate the credit quantity based upon qualified earnings and other qualifying costs.
Retroactive Claim Evaluation: If you are eligible to declare the ERC for prior quarters, these business can evaluate your previous payroll records and financials to determine possible chances for retroactive credits. They can help you modify prior income tax return to declare these refunds.
Filing Support: Companies focusing on ERC filings will prepare and send the necessary forms and documents on your behalf. This consists of finishing Kind 941 or any other required tax forms.
Compliance and Updates: ERC policies and assistance have actually developed gradually. These business remain updated with the latest modifications and ensure that your filings comply with the most existing standards. They can likewise provide continuous assistance if the IRS requests additional details or conducts an audit related to your ERC claim.
It’s important to research and veterinarian any company using ERC filing help to ensure their trustworthiness and expertise. Search for established companies with experience in tax and payroll services, or consider connecting to trusted accounting companies or tax experts who provide ERC submitting assistance.
Bear in mind that while these companies can offer valuable assistance, it’s constantly a great concept to have a standard understanding of the ERC requirements and process yourself. This will assist you make notified choices and guarantee precise filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief measures. The objective of the ERC is to encourage organizations to maintain and pay their workers during the pandemic, even if their operations have actually been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is offered to qualified employers, consisting of for-profit services, tax-exempt companies, and particular governmental entities. To certify, employers should fulfill one of two criteria:.
Business operations were completely or partly suspended due to a federal government order related to COVID-19.
Business experienced a substantial decrease in gross receipts. As discussed previously, for 2021, a substantial decrease is specified as a 20% decline in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a considerable decline is defined 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 immediately preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit amount amounts to a percentage (approximately 70%) of certified wages paid to workers, consisting of particular health insurance 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: At first, services that received an Income Defense Program (PPP) loan were not qualified for the ERC. However, legislation passed in late 2020 and extended in 2021 allows services to declare the ERC even if they received a PPP loan. The same salaries can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively expanded and boosted, permitting qualified employers to declare the credit for certified earnings 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.
Declaring the Credit: Companies can claim the ERC by reporting it on their employment income tax return, normally Type 941. If the credit surpasses the amount of work taxes owed, the excess can be reimbursed to the company.
It is necessary to keep in mind that the ERC arrangements and eligibility requirements have evolved over time. The very best strategy is to seek advice from a tax expert or visit the official internal revenue service website for the most detailed and current info concerning the ERC, including any current legal modifications or updates.
To get approved for the ERC, a service needs to satisfy one of the following requirements:.
The business operations were fully or partly suspended due to a federal government order related to COVID-19.
The business experienced a substantial decrease in gross receipts. For 2021, a significant decrease is specified as a 20% decrease in gross invoices compared to the 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 immediately preceding quarter.
The ERC is available to businesses of all sizes, including tax-exempt organizations, however there are some exceptions. For example, government entities and services that received a PPP loan may have limitations on declaring the credit.
The process for declaring the ERC includes completing the necessary types and including the credit on your work income tax return (typically Kind 941). The exact time it requires to process the credit can differ based upon a number of factors, including the intricacy of your service and the workload of the IRS. It’s suggested to speak with a tax expert for assistance specific to your circumstance.
There are several companies that can assist with the procedure of claiming the ERC. Some widely known companies that offer assistance with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the information supplied here is based upon basic understanding and might not reflect the most current updates or changes to the ERC. It’s important to speak with a tax expert or visit the main internal revenue service site for the most precise and up-to-date information relating to eligibility, claiming procedures, and offered help.
Less than 100. The credit is based if the employer had 100 or less workers on average in 2019.
on salaries paid to all workers whether they really worked or not. In other words, even if the.
staff members 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 usually in 2019, then the credit is.
permitted only for wages paid to workers who did not work during the calendar quarter.
In both cases, “incomes” consists of not just cash payments but also a part of the expense of employer.
supplied healthcare. Employee Retention Credit And Ppp2
Companies can be right away compensated for the credit by decreasing the quantity of payroll taxes they.