Lets talk first about Employee Retention Credit .Gov :
Our group here what do these guys doing everybody in this room is assisting teach individuals about ERC and uh constantly offer a gorgeous breakfast and have individuals really find out about the program we ought to head to the room where we have the ability 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 countless dollars literally Kevin hundreds of millions of dollars so these are duplicate copies of the letters that go to customers verifying that the check is on the way I indicate you know if you just start to take a look at some of these here I imply this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I indicate it’s simply I imply consider the number of real clients that went through the program yeah this is the very end this is the celebration at the end when the check is confirmed the numbers are confirmed 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 understand when you
receive this you know the check is gone for sure and that’s when they pay so they do not pay anything up until they in fact receive the cash they don’t pay bottom line Wonder trust anything until this letter is confirmed the check is on the way they transfer it into their checking account and they can truly trust Wonder trust that the process has actually been completed and how many you think you’ve processed considering that you started this we have to do with 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 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 really important today the employee retention credit which the majority of you have never ever become aware of I certainly hadn’t heard of it until really just recently and learned a lot about it since this is most likely the lowest cost of capital for any small company anywhere
anytime if you have employees in between 5 and five hundred so I’ve got the specialist with me this is Josh Fox he’s the founder and CEO of bottom line Concepts 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 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’ve ended up being yes the Ambassador and paid representative for this I enjoy this program it’s going away soon you got to discover all about it let’s talk employee 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 companies three opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically everybody it makes a big difference right there 2 of them are loans and one’s a refund precisely so the ERC is a refund that’s.
fix the money cash payroll tax refund fine go on sorry I simply have to make certain we got that point I suggest that’s a huge difference a loan versus cash money I like cash money that’s what we’re speaking 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 original cares Act is the ERC and yes Kevin it is a beautiful hard check in the mail where you get real cash from the internal revenue service all right so let’s speak about how it works because it sounds like to me if it’s a if it’s staff member retention credit that person had to be a staff member 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 employees right you had to have actually owned a company but it’s based on you having W-2 employees 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 correct so there were six quarters the program was open well stroll us through the six quarters so you had quarters 2 three and 4 of 2020 and you had quarters one 2 and three of 2021. alright so that’s how it’s measured you need to be on the W-2 throughout that period now let’s talk my preferred part cash just how much can you return per staff member that was on a W-2 in those six quarters so the estimation in 2020 to be exact Kevin is 50 of the staff member’s wage to a maximum of five thousand dollars per staff member for the year of 2020 and in 2021 the numbers increased to 70 of the employee’s income to an optimum of seven thousand per quarter how did that happen um they just altered the rules in.
2021 versus since 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 approximately 5 thousand Max and after that what occurs 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 six thousand dollars per employee that is since that’s a great deal of cash it is now there’s a caveat here the PPP cash would have to be reduced 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 dining establishment in New york city City where I’m from and you had a hundred workers 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 big concern is why does no one learn about this due to the fact that appearance when I initially heard about this when I first fulfilled Josh you understand I have actually got lots of investments in lots of business I’m a significant supporter for entrepreneurship in America and make lots of numerous financial investments in entrepreneurs of which numerous suffered through the pandemic when I first became aware of this I called BS I don’t think it due to the fact that I utilize the PPP we went through the cash center Banks to get it it was really 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 stay alive during the pandemic so when I became aware of this I stated nah it can’t hold true but when I dug around I even called to my political leader pals Governor Senators they didn’t know about it I imply that’s how you understand that’s how false information is that there’s no info out there then a lot of people told me well you can’t get it because you took the PPP also not true so let’s ask Josh why does nobody learn about the staff member retention credit you understand what’s intriguing you’re discussing the banks Kevin since in the PPP loan process 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 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 process process that’s all um and here there was turmoil because keep in mind in the original cares act you could not do both programs so if you had actually done PPP you might not do ERC in the initial 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 know how to do this not actually she or he’s never ever done it before do the banks do it nope the banks do not do it the payroll business yeah some 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 actually been in business since 2009 and we have actually been dealing with the federal government and the state government to recuperate money for Fortune 500 Fortune 1000 companies so a great deal of our huge big business customers have worked with bottom line to recover other federal government programs we have actually done sales tax and use tax joblessness tax work chance tax credits research and development tax credits unclaimed home property tax all of these other government programs.
The staff member retention tax credit is a broad based refundable tax credit designed to encourage.
companies to keep workers on their payroll. The credit is 50% of approximately $10,000 in salaries paid by an.
Since of COVID-19 or whose gross invoices, employer whose company is fully or partially suspended.
decline by more than 50%.
1. The credit is available to all employers no matter size including tax exempt companies. There are.
just two exceptions: (1) state and city governments and their instrumentalities and (2) little.
organizations who take Small Business Loans.
2. To certify, the company has to meet one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the employer’s company is totally or partially suspended by government order due to COVID-19.
during the calendar quarter or.
o the employer’s gross invoices are listed below 50% of the equivalent quarter in 2019. Once the.
company’s gross invoices exceed 80% of an equivalent quarter in 2019 they no longer certify.
after the end of that quarter.
Computation of the Credit.
The quantity of the credit is 50% of the certifying earnings paid up to $10,000 in overall.
It is effective for incomes paid after March 13th and prior to December 31, 2020.
The meaning of certifying earnings differs by whether an employer had, typically, basically than.
100 workers in 2019.
Companies that concentrate on ERC filing help normally provide proficiency and assistance to help companies navigate the complex procedure of claiming the credit. They can use numerous services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit .Gov
Eligibility Evaluation: These companies will evaluate your company’s eligibility for the ERC based upon factors such as your market, profits, and operations. They can help identify if you meet the requirements for the credit and identify the maximum credit amount you can claim.
Documentation and Computation: ERC filing services will help in gathering the essential paperwork, such as payroll records and financial declarations, to support your claim. They will also help calculate the credit quantity based on eligible earnings and other certifying costs.
Retroactive Claim Evaluation: If you are qualified to declare the ERC for prior quarters, these business can evaluate your previous payroll records and financials to determine potential opportunities for retroactive credits. They can assist you amend prior tax returns to declare these refunds.
Filing Support: Companies focusing on ERC filings will prepare and send the required kinds and paperwork in your place. This consists of finishing Form 941 or any other necessary tax return.
Compliance and Updates: ERC regulations and assistance have developed gradually. These business stay upgraded with the latest modifications and make sure that your filings abide by the most present guidelines. If the IRS requests extra information or conducts an audit related to your ERC claim, they can likewise supply ongoing assistance.
It is very important to research study and vet any business offering ERC filing assistance to guarantee their reliability and expertise. Look for recognized companies with experience in tax and payroll services, or consider reaching out to relied on accounting companies or tax experts who use ERC submitting assistance.
Bear in mind that while these business can provide valuable help, it’s always a good concept to have a basic understanding of the ERC requirements and procedure yourself. This will help you make informed decisions and guarantee accurate filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit introduced by the U.S. federal government as part of COVID-19 relief steps. The objective of the ERC is to motivate organizations to retain and pay their staff members 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 qualified companies, consisting of for-profit services, tax-exempt organizations, and particular governmental entities. To certify, employers must satisfy one of two criteria:.
The business operations were totally or partially suspended due to a government order related to COVID-19.
The business experienced a considerable decrease in gross invoices. As pointed out previously, for 2021, a significant decline 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 specified as a 20% decline in gross receipts compared to the same quarter in 2019, or a 20% decline in gross invoices compared to the immediately preceding quarter.
Credit Amount: 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 qualified earnings paid to employees, consisting of particular health insurance expenditures. 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 a Paycheck Defense Program (PPP) loan were not eligible for the ERC. However, legislation passed in late 2020 and extended in 2021 permits companies to declare the ERC even if they received a PPP loan. However, the exact same incomes can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively expanded and enhanced, allowing eligible companies to claim the credit for certified incomes paid as far back as March 13, 2020. This retroactive arrangement provides an opportunity for businesses to modify prior-year tax returns and receive refunds.
Claiming the Credit: Employers can claim the ERC by reporting it on their work tax returns, typically Kind 941. If the credit goes beyond the quantity of employment taxes owed, the excess can be refunded to the employer.
It is essential to keep in mind that the ERC arrangements and eligibility requirements have evolved gradually. The best strategy is to speak with a tax expert or visit the main internal revenue service site for the most up-to-date and comprehensive information relating to the ERC, including any recent legal modifications or updates.
To receive the ERC, a company needs to satisfy among the following requirements:.
The business operations were completely or partly suspended due to a government order related to COVID-19.
Business experienced a considerable decrease in gross receipts. For 2021, a substantial decrease is defined as a 20% decrease in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a considerable decrease is specified as a 20% decrease in gross receipts compared to the very same quarter in 2019, or a 20% decline in gross invoices compared to the instantly preceding quarter.
The ERC is offered to services of all sizes, including tax-exempt organizations, but there are some exceptions. Government entities and organizations that received a PPP loan may have restrictions on claiming the credit.
The procedure for declaring the ERC includes completing the necessary forms and consisting of the credit on your employment tax return (usually Kind 941). The exact time it requires to process the credit can vary based on a number of factors, including the intricacy of your service and the work of the IRS. It’s suggested to speak with a tax professional for assistance particular to your circumstance.
There are several business that can assist with the process of claiming the ERC. Some popular companies that offer assistance with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the info offered here is based on general knowledge and may not show the most current updates or modifications to the ERC. It is essential to seek advice from a tax expert or go to the main internal revenue service site for the most accurate and current info relating to eligibility, declaring procedures, and offered assistance.
Less than 100. The credit is based if the employer had 100 or less employees on average in 2019.
on earnings paid to all employees whether they in fact worked or not. To put it simply, even if the.
employees worked full time and earned money for full time work, the employer still gets the credit.
Greater than 100. The credit is if the company had more than 100 workers on average in 2019.
allowed only for earnings paid to employees who did not work during the calendar quarter.
In both cases, “earnings” consists of not just money payments but likewise a portion of the expense of company.
supplied healthcare. Employee Retention Credit .Gov
Companies can be immediately reimbursed for the credit by reducing the quantity of payroll taxes they.