Lets talk first about Employee Retention Credit Audit :
Our group here what do these men doing everybody in this space is assisting teach people about ERC and uh always offer a beautiful breakfast and have people really learn more about the program we need to head to the room where we are able to display a few of the checks that we are getting for companies and I wish to see that what is this this is uh hundreds of millions of dollars actually Kevin numerous millions of dollars so these are duplicate copies of the letters that go to customers confirming that the check is on the method I indicate you know if you just start to look at a few 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 how many actual clients that went through the program yeah this is the very end this is the party at the end when the check is validated the numbers are validated and the check is on the mail in the mail from the internal revenue service heading to the client so that’s how you have the ability to track it you understand when you
receive this you know the check is gone for sure which’s when they pay so they do not pay anything until they actually receive the money they do not pay bottom line Wonder trust anything up until this letter is confirmed the check is on the way they transfer it into their bank account and they can genuinely trust Wonder trust that the procedure has actually been finished and how many you think you have actually processed because you began this we’re about 35 000 of these for
about 6 billion dollars wow so plainly they know 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 Fantastic here you’re at my YouTube channel we’re discussing something actually crucial today the staff member retention credit which most of you have never heard of I certainly had not become aware of it until really just recently and discovered a lot about it because this is most likely the most affordable cost of capital for any small business 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 Concepts they’re the largest processor of these ERC credits this is a 170 page program so it’s difficult this isn’t like PPP we just call up your bank manager and state provide me a loan it does not work there’s not a loan it’s an application and Josh is going to tell all of us about it and how to get it and why I have actually become yes the Ambassador and paid representative for this I love this program it’s disappearing soon you got to learn all about it let’s talk worker retention credit Josh Fox what is an ERC let’s just start 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 opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and almost 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 all right go on sorry I simply have to make certain we got that point I suggest that’s a big difference a loan versus money money I like cash cash that’s what we’re talking about okay 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 initial cares Act is the ERC and yes Kevin it is a beautiful hard check in the mail where you get real cash from the IRS all right so let’s discuss how it works since it sounds like to me if it’s a if it’s staff member retention credit that individual 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 staff members right you needed to have actually owned a business but it’s based on you having W-2 workers in America not 10.99. As long as you had W-2 employees 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 first six months of 2021 on the W-2 appropriate so there were 6 quarters the program was open well stroll us through the six quarters so you had quarters 2 3 and four of 2020 and you had quarters one 2 and 3 of 2021. all right so that’s how it’s measured you need to be on the W-2 during that period now let’s talk my preferred part cash how much can you return per employee that was on a W-2 in those six quarters so the computation in 2020 to be precise Kevin is 50 of the staff member’s income to an optimum of 5 thousand dollars per staff member for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the worker’s wage to a maximum of 7 thousand per quarter how did that happen um they simply altered the rules in.
2021 versus since the mayhem 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 up to five 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 worker that is because that’s a lot of cash it is now there’s a caveat here the PPP cash would need to be decreased 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 usually Kevin is if you took PPP cash 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 staff members and you took PPP cash you would still get a million dollar in the mail from the internal revenue service so it’s substantial undoubtedly now the huge question is why does no one know about this since appearance when I initially became aware of this when I initially met Josh you know I’ve got lots of investments in great deals of business I’m a major supporter for entrepreneurship in America and make numerous many investments in entrepreneurs of which lots of suffered through the pandemic when I initially found out about this I called BS I don’t think it because I utilize the PPP we went through the money center Banks to get it it was very easy to do we had our CEOs call the banks they got their loans and that were well should have and we utilized them sensibly to survive during 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 political leader buddies Guv Senators they didn’t know about it I indicate that’s how you understand that’s how misinformation is that there’s no info out there then a bunch of people informed me well you can’t get it since you took the PPP also not real so let’s ask Josh why does nobody understand 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 process 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 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 process procedure that’s all um and here there was mayhem because keep in mind in the initial cares act you could refrain from doing 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 not doing ERC due to the fact that it’s not alone so you’re getting a tax refund so the government never ever made it clear to any person about how to.
do this does your CFO understand how to do this not really he or she’s never ever done it in the past do the banks do it nope the banks do not do it the payroll companies yeah a few of them are doing it as a payroll company your accountant no your accountant’s never ever done this prior to unless you have an account that entered into this company and bottom line my company Kevin has actually stayed in business since 2009 and we’ve been dealing with the federal government and the state government to recover money for Fortune 500 Fortune 1000 companies so a lot of our huge big corporate customers have actually dealt with bottom line to recuperate other government programs we have actually done sales tax and utilize tax unemployment tax work chance tax credits research and development tax credits unclaimed home property tax all of these other government programs.
The worker 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 up to $10,000 in incomes paid by an.
Since of COVID-19 or whose gross invoices, company whose service is totally or partly suspended.
decline by more than 50%.
Schedule.
1. The credit is offered to all companies regardless of size consisting of tax exempt organizations. There are.
just two exceptions: (1) state and city governments and their instrumentalities and (2) small.
organizations who take Small Business Loans.
2. To qualify, the employer needs to fulfill one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the company’s company is totally or partially suspended by government order due to COVID-19.
throughout the calendar quarter or.
o the employer’s gross invoices are below 50% of the similar quarter in 2019. When the.
employer’s gross invoices exceed 80% of a similar quarter in 2019 they no longer qualify.
after the end of that quarter.
Computation of the Credit.
The amount of the credit is 50% of the qualifying earnings paid up to $10,000 in overall.
It works for salaries paid after March 13th and prior to December 31, 2020.
The meaning of qualifying salaries differs by whether an employer had, typically, more or less than.
100 workers in 2019.
Companies that concentrate on ERC filing support generally supply know-how and support to help services browse the complex process of claiming the credit. They can provide numerous services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit Audit
Eligibility Evaluation: These companies will assess your organization’s eligibility for the ERC based on factors such as your market, profits, and operations. They can help identify if you fulfill the requirements for the credit and recognize the maximum credit quantity you can declare.
Documentation and Calculation: ERC filing services will assist in collecting the essential documentation, such as payroll records and financial declarations, to support your claim. They will likewise help determine the credit amount based on eligible wages and other qualifying costs.
Retroactive Claim Review: If you are qualified to claim the ERC for prior quarters, these companies can examine your previous payroll records and financials to recognize prospective chances for retroactive credits. They can assist you change prior income tax return to claim these refunds.
Filing Assistance: Companies focusing on ERC filings will prepare and submit the necessary kinds and documentation on your behalf. This consists of completing Form 941 or any other required tax forms.
Compliance and Updates: ERC regulations and assistance have actually progressed in time. These business stay upgraded with the most recent modifications and ensure that your filings adhere to the most current standards. They can likewise provide ongoing assistance if the IRS requests additional details or performs an audit related to your ERC claim.
It’s important to research and vet any company offering ERC filing assistance to ensure their trustworthiness and competence. Look for established firms with experience in tax and payroll services, or think about reaching out to trusted accounting companies or tax professionals who use ERC filing assistance.
Bear in mind that while these companies can offer important support, it’s constantly an excellent concept to have a basic understanding of the ERC requirements and process yourself. This will help you make notified choices and guarantee precise filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit presented by the U.S. government as part of COVID-19 relief steps. The goal of the ERC is to motivate companies 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 eligible employers, consisting of for-profit organizations, tax-exempt companies, and specific governmental entities. To qualify, employers should fulfill one of two requirements:.
The 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 considerable decline is defined as a 20% decline in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a significant decline is defined as a 20% decrease in gross invoices compared to the same quarter in 2019, or a 20% decline in gross receipts compared to the right away preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit quantity is equal to a percentage (approximately 70%) of qualified incomes paid to employees, consisting of specific health plan expenses. The maximum 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 got an Income Security Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 allows businesses to declare the ERC even if they received a PPP loan. Nevertheless, the exact same earnings can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively broadened and enhanced, allowing eligible employers to claim the credit for qualified salaries paid as far back as March 13, 2020. This retroactive arrangement offers a chance for services to amend prior-year tax returns and get refunds.
Declaring the Credit: Companies can declare the ERC by reporting it on their work tax returns, usually Kind 941. If the credit surpasses the amount of work taxes owed, the excess can be refunded to the employer.
It is necessary to keep in mind that the ERC arrangements and eligibility criteria have progressed gradually. The best strategy is to seek advice from a tax professional or check out the main IRS website for the most up-to-date and comprehensive information relating to the ERC, including any current legislative changes or updates.
To receive the ERC, a company must meet one of the following criteria:.
Business operations were totally or partly suspended due to a government order related to COVID-19.
Business experienced a considerable decrease in gross invoices. For 2021, a significant decline is defined as a 20% decline in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a substantial decline is defined as a 20% decline in gross invoices compared to the same quarter in 2019, or a 20% decline in gross invoices compared to the instantly preceding quarter.
The ERC is available to companies of all sizes, including tax-exempt companies, however there are some exceptions. For instance, federal government entities and organizations that got a PPP loan might have restrictions on claiming the credit.
The procedure for declaring the ERC involves completing the necessary kinds and consisting of the credit on your employment income tax return (normally Form 941). The exact time it takes to process the credit can vary based upon a number of factors, consisting of the complexity of your organization and the work of the IRS. It’s suggested to talk to a tax professional for assistance particular to your situation.
There are a number of companies that can aid with the process of claiming the ERC. These include accounting companies, tax advisory services, and payroll service providers. Some well-known companies that use support with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s recommended to research study and call these companies directly to ask about their services and costs.
Please keep in mind that the information offered here is based on basic understanding and might not show the most current updates or changes to the ERC. It is very important to speak with a tax professional or go to the official internal revenue service site for the most updated and accurate details regarding eligibility, declaring procedures, and available help.
Less than 100. If the company had 100 or less staff members on average in 2019, then the credit is based.
on earnings paid to all staff members whether they actually worked or not. Simply put, even if the.
staff members worked full time and earned money for full-time work, the company still gets the credit.
Greater than 100. The credit is if the employer had more than 100 workers on average in 2019.
permitted only for earnings paid to employees who did not work during the calendar quarter.
In both cases, “wages” consists of not simply money payments but likewise a part of the cost of employer.
provided healthcare. Employee Retention Credit Audit
Payment.
Companies can be right away reimbursed for the credit by decreasing the amount of payroll taxes they.