Lets talk first about Employee Retention Credit For Working Through The Pandemic :
Our group here what do these guys doing everyone in this space is helping teach people about ERC and uh constantly supply a stunning breakfast and have individuals really find out about the program we must head to the room where we are able to show some of the checks that we are getting for business and I ‘d like to see that what is this this is uh numerous millions of dollars actually Kevin numerous millions of dollars so these are replicate copies of the letters that go to clients verifying that the check is on the way I imply you know if you simply start to take a look at some of these here I indicate this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I imply it’s simply I mean consider how many actual customers that went through the program yeah this is the very end this is the celebration at the end when the check is verified the numbers are confirmed 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
get this you know the check is chosen sure and that’s when they pay so they do not pay anything till they in fact get the cash they don’t pay bottom line Wonder trust anything till this letter is validated the check is on the way they deposit it into their bank account and they can truly rely on Wonder trust that the process has actually been completed and the number of you think you have actually processed since you began this we’re about 35 000 of these for
about 6 billion dollars wow so plainly they understand what they’re doing which’s what you require you need experts 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 really important today the employee retention credit which most of you have never heard of I definitely hadn’t heard of it until extremely recently and learned a lot about it since this is most likely the most affordable cost of capital for any small company anywhere
anytime if you have workers between 5 and five hundred so I’ve got the professional with me this is Josh Fox he’s the founder and CEO of bottom line Ideas 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 just call 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 us all about it and how to get it and why I’ve become yes the Ambassador and paid representative for this I love this program it’s going away very soon you got to learn everything about it let’s talk worker retention credit Josh Fox what is an ERC let’s simply begin there so throughout the Trump Administration when President Trump was enacted they created the cares Act and the cares act provided companies three opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly everyone it makes a huge difference 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 just need to make sure we got that point I imply that’s a big difference a loan versus cash money I like money money that’s what we’re speaking 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 hard check in the mail where you get real money from the IRS all right so let’s talk about how it works due to the fact that it seems 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 shareholders it’s for employees right you had to have actually owned a business however it’s based on you having W-2 staff members in America not 10.99. As long as you had W-2 staff members and you paid federal payroll taxes that’s why you would be eligible so you have to be on payroll in 2020 on the W-2 and you have to be on payroll for the first 6 months of 2021 on the W-2 proper so there were 6 quarters the program was open well stroll us through the 6 quarters so you had quarters two 3 and 4 of 2020 and you had quarters one 2 and three of 2021. alright so that’s how it’s determined you need to be on the W-2 during that duration 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 employee’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 wage to a maximum of 7 thousand per quarter how did that occur um they just altered the rules in.
2021 versus since the mayhem of the pandemic so they wanted 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 after that what occurs 21 000 Max in 2021 oh that’s how you develop twenty 6 thousand twenty one thousand to twenty twenty one plus five thousand in twenty twenty that’s twenty six thousand dollars per staff member that is because that’s a lot of money it is now there’s a caution here the PPP cash would need to be lowered from the twenty six thousand dollars so if you took PPP loan one and PPP loan two you would reduce the 26 000 so what we’re seeing usually Kevin is if you took PPP money somewhere around ten thousand dollars an individual so let’s state hypothetically you owned a restaurant in New York City where I’m from and you had a hundred workers and you took PPP money you would still get a million dollar in the mail from the IRS so it’s huge undoubtedly now the huge concern is why does no one learn about this because appearance when I first found out about this when I initially satisfied Josh you know I have actually got lots of investments in lots of companies I’m a significant supporter for entrepreneurship in America and make many lots of investments in business owners of which lots of suffered through the pandemic when I initially 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 extremely easy to do we had our CEOs call the banks they got their loans and that were well should have and we used them carefully to stay alive throughout the pandemic so when I heard about this I stated nah it can’t hold true but when I dug around I even called to my politician good friends Guv Senators they didn’t understand about it I imply that’s how you know that’s how false information is that there’s no information out there then a bunch of people informed me well you can’t get it because you took the PPP likewise not real so let’s ask Josh why does nobody know about the worker retention credit you understand what’s interesting you’re talking about the banks Kevin due to the fact that in the PPP loan procedure the federal government made it very clear that if you desired a PPP loan you would call Wells Fargo Citibank Bank of America any of the huge banks in our nation and they would process process in Canada a pre-pp loan there’s no loans in Canada by the way it’s just process procedure that’s all um and here there was chaos because keep in mind in the initial cares act you could not do both programs so if you had actually done PPP you could refrain from doing 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 federal 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 companies yeah some of them are doing it as a payroll business your accountant no your accountant’s never done this before unless you have an account that went into this business and bottom line my firm Kevin has actually been in business since 2009 and we have actually been working with the federal government and the state federal government to recuperate money for Fortune 500 Fortune 1000 companies so a great deal of our big big business clients have actually worked with bottom line to recover other federal government programs we’ve done sales tax and utilize tax unemployment tax work opportunity tax credits research and development tax credits unclaimed property property tax all of these other federal government programs.
The employee 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 up to $10,000 in wages paid by an.
company whose organization is fully or partly suspended because of COVID-19 or whose gross invoices.
decrease by more than 50%.
1. The credit is available to all companies regardless of size consisting of tax exempt organizations. There are.
just two exceptions: (1) state and local governments and their instrumentalities and (2) small.
organizations who take Small company Loans.
2. To certify, the employer needs to fulfill one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the employer’s organization is completely or partially suspended by federal government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross receipts are below 50% of the similar quarter in 2019. Once the.
employer’s gross invoices exceed 80% of a comparable quarter in 2019 they no longer qualify.
after the end of that quarter.
Calculation of the Credit.
The quantity 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 prior to December 31, 2020.
The meaning of certifying incomes varies by whether an employer had, typically, more or less than.
100 staff members in 2019.
Companies that focus on ERC filing help normally offer know-how and support to help organizations navigate the complicated process of declaring the credit. They can offer various services, including:.
How is the employee retention credit calculated? Employee Retention Credit For Working Through The Pandemic
Eligibility Evaluation: These companies will assess your service’s eligibility for the ERC based upon aspects such as your industry, income, and operations. They can assist figure out if you satisfy the requirements for the credit and determine the maximum credit amount you can claim.
Paperwork and Computation: ERC filing services will assist in gathering the required documents, such as payroll records and financial declarations, to support your claim. They will also help determine the credit quantity based upon qualified earnings and other qualifying expenditures.
Retroactive Claim Evaluation: If you are qualified to claim the ERC for prior quarters, these companies can evaluate your past payroll records and financials to identify potential chances for retroactive credits. They can help you change previous tax returns to declare these refunds.
Filing Help: Business concentrating on ERC filings will prepare and send the required types and paperwork on your behalf. This consists of finishing Kind 941 or any other necessary tax forms.
Compliance and Updates: ERC guidelines and assistance have actually evolved with time. These business stay updated with the latest modifications and guarantee that your filings comply with the most current standards. If the IRS requests additional information or performs an audit related to your ERC claim, they can also provide ongoing assistance.
It is essential to research and veterinarian any business offering ERC filing help to ensure their reliability and know-how. Search for recognized firms with experience in tax and payroll services, or consider reaching out to trusted accounting firms or tax experts who use ERC filing support.
Remember that while these business can supply valuable support, it’s always an excellent concept to have a basic understanding of the ERC requirements and procedure yourself. This will help you make informed choices and ensure 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 procedures. The objective of the ERC is to encourage businesses to maintain and pay their employees 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 companies, including for-profit businesses, tax-exempt organizations, and particular governmental entities. To qualify, companies need to satisfy one of two requirements:.
Business operations were totally or partially suspended due to a government order related to COVID-19.
The business experienced a significant decrease in gross invoices. As pointed out previously, for 2021, a considerable decrease is defined as a 20% decline in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a significant decline is specified as a 20% decline in gross receipts compared to the exact same quarter in 2019, or a 20% decline in gross invoices compared to the immediately preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the employer’s share of Social Security taxes. The credit quantity is equal to a portion (as much as 70%) of certified incomes paid to employees, including particular health insurance costs. The optimum credit per staff member is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, companies that got an Income Protection Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 allows organizations to declare the ERC even if they got a PPP loan. The same wages can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively broadened and improved, permitting eligible companies to claim the credit for certified earnings paid as far back as March 13, 2020. This retroactive arrangement supplies a chance for companies to modify prior-year income tax return 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 surpasses the quantity of employment taxes owed.
It is necessary to keep in mind that the ERC arrangements and eligibility criteria have actually progressed gradually. The best strategy is to consult with a tax expert or visit the official IRS site for the most detailed and current details concerning the ERC, including any recent legal modifications or updates.
To receive the ERC, a company should satisfy one of the following requirements:.
Business operations were completely or partially suspended due to a government order related to COVID-19.
Business experienced a substantial decline in gross receipts. For 2021, a considerable decline is specified as a 20% decline in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a substantial decline is specified as a 20% decline in gross invoices compared to the very same quarter in 2019, or a 20% decline in gross invoices compared to the right away preceding quarter.
The ERC is offered to businesses of all sizes, including tax-exempt organizations, however there are some exceptions. For example, federal government entities and companies that received a PPP loan might have restrictions on declaring the credit.
The process for declaring the ERC includes completing the essential kinds and consisting of the credit on your work tax return (normally Form 941). The exact time it requires to process the credit can differ based upon numerous factors, consisting of the complexity of your business and the workload of the IRS. It’s suggested to talk to a tax expert for guidance particular to your circumstance.
There are several companies that can assist with the process of claiming the ERC. Some popular business that provide help with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the information supplied here is based upon basic understanding and may not show the most recent updates or changes to the ERC. It is essential to speak with a tax expert or go to the main internal revenue service site for the most accurate and up-to-date information relating to eligibility, declaring treatments, and readily available support.
Less than 100. The credit is based if the company had 100 or less staff members on average in 2019.
on incomes paid to all workers whether they really worked or not. Simply put, even if the.
employees worked full-time and made money for full-time work, the employer still gets the credit.
Greater than 100. The credit is if the employer had more than 100 workers on average in 2019.
allowed just for incomes paid to employees who did not work during the calendar quarter.
In both cases, “incomes” includes not just cash payments but also a part of the expense of company.
provided healthcare. Employee Retention Credit For Working Through The Pandemic
Employers can be immediately reimbursed for the credit by lowering the quantity of payroll taxes they.