Lets talk first about Employee Retention Credit Irma :
Our team here what do these guys doing everybody in this room is assisting teach people about ERC and uh constantly supply a stunning breakfast and have people truly find out about the program we should head to the space where we have the ability to display some of the checks that we are getting for companies and I ‘d like to see that what is this this is uh numerous millions of dollars literally Kevin hundreds of countless dollars so these are duplicate copies of the letters that go to customers confirming that the check is on the method I indicate you understand 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 suggest it’s just I imply think about the number of real customers that went through the program yeah this is the very end this is the celebration at the end when the check is validated the numbers are confirmed and the check is on the mail in the mail from the internal revenue service heading to the customer so that’s how you’re able to track it you understand when you
receive this you understand the check is chosen sure and that’s when they pay so they don’t pay anything till they actually get the cash they do not pay bottom line Wonder trust anything up until this letter is confirmed the check is on the way they deposit it into their savings account and they can really trust Wonder trust that the procedure has been completed and the number of you believe you’ve processed because you began this we’re about 35 000 of these for
about 6 billion dollars wow so clearly they understand what they’re doing which’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 speaking about something really crucial today the employee retention credit which most of you have never heard of I certainly hadn’t become aware of it until very recently and learned a lot about it due to the fact that this is probably the most affordable expense of capital for any small business anywhere
anytime if you have staff members in between five and five hundred so I have actually 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 not easy this isn’t like PPP we simply call your bank supervisor and say give me a loan it doesn’t 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 become yes the Ambassador and paid representative for this I enjoy 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 start there so during the Trump Administration when President Trump was enacted they came up with the cares Act and the cares act used services 3 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 two of them are loans and one’s a refund exactly so the ERC is a refund that’s.
remedy the cash money payroll tax refund fine go on sorry I just need to ensure we got that point I suggest that’s a big distinction a loan versus money cash I like money money that’s what we’re discussing 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 initial cares Act is the ERC and yes Kevin it is a stunning tough check in the mail where you get actual money from the IRS all right so let’s speak about 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 a staff member so I’m going to make the Assumption this money is not for the owner not for individuals on the cap table not for investors it’s for workers right you had to have owned an organization however it’s based on 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 first 6 months of 2021 on the W-2 right so there were six quarters the program was open well walk us through the six quarters so you had quarters 2 three and 4 of 2020 and you had quarters one 2 and 3 of 2021. okay so that’s how it’s measured you need to be on the W-2 throughout that duration now let’s talk my favorite part cash how much can you return per staff member that was on a W-2 in those 6 quarters so the calculation in 2020 to be specific 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 an optimum of 7 thousand per quarter how did that take place um they just changed the rules in.
2021 versus due to the fact that the mayhem 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 5 thousand Max and then what occurs 21 000 Max in 2021 oh that’s how you come up with twenty 6 thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty six thousand dollars per worker that is because that’s a lot of cash it is now there’s a caveat here the PPP money would need to be decreased from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan two you would decrease the 26 000 so what we’re seeing usually Kevin is if you took PPP money somewhere around ten thousand dollars a person so let’s say hypothetically you owned a restaurant 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 IRS so it’s big clearly now the big question is why does no one learn about this since appearance when I first became aware of this when I initially satisfied Josh you know I’ve got great deals of financial 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 first became aware of this I called BS I do not think it due to the fact that I use 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 which were well deserved and we used them sensibly to stay alive during the pandemic so when I became aware of this I said nah it can’t hold true however when I dug around I even called to my political leader friends Guv Senators they didn’t understand about it I mean that’s how you know that’s how false information is that there’s no info out there then a bunch of people told 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 interesting you’re talking about the banks Kevin since in the PPP loan process the federal government made it really clear that if you wanted a PPP loan you would call Wells Fargo Citibank Bank of America any of the big banks in our nation and they would process procedure in Canada a pre-pp loan there’s no loans in Canada by the way it’s simply procedure process that’s all um and here there was mayhem because remember in the original cares act you could not do both programs so if you had actually done PPP you might refrain from doing ERC in the original program and when they altered the law in 2021 the banks were not doing ERC because it’s not alone so you’re getting a tax refund so the government never made it clear to anybody about how to.
do this does your CFO understand how to do this not really 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 a few of them are doing it as a payroll business your accounting professional no your accountant’s never ever done this prior to unless you have an account that entered into this company and bottom line my firm Kevin has actually stayed in business considering that 2009 and we have actually been working with the federal government and the state federal government to recuperate cash for Fortune 500 Fortune 1000 companies so a lot of our huge huge corporate clients have actually dealt 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 property property tax all of these other government programs.
The worker retention tax credit is a broad based refundable tax credit created to motivate.
employers to keep employees on their payroll. The credit is 50% of up to $10,000 in earnings paid by an.
Since of COVID-19 or whose gross invoices, company whose organization is totally or partially suspended.
decrease by more than 50%.
1. The credit is offered to all companies no matter size including tax exempt companies. 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 company needs to satisfy one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the employer’s business is totally or partly suspended by government order due to COVID-19.
during the calendar quarter or.
o the employer’s gross receipts are below 50% of the similar quarter in 2019. When the.
company’s gross invoices go above 80% of a comparable quarter in 2019 they no longer certify.
after the end of that quarter.
Computation of the Credit.
The amount of the credit is 50% of the certifying incomes paid up to $10,000 in total.
It works for wages paid after March 13th and prior to December 31, 2020.
The definition of qualifying earnings varies by whether a company had, on average, more or less than.
100 workers in 2019.
Companies that concentrate on ERC filing assistance typically supply expertise and support to help organizations browse the complex process of claiming the credit. They can offer various services, including:.
How is the employee retention credit calculated? Employee Retention Credit Irma
Eligibility Assessment: These companies will assess your business’s eligibility for the ERC based upon factors such as your market, profits, and operations. They can help determine if you satisfy the requirements for the credit and identify the maximum credit quantity you can claim.
Documentation and Computation: ERC filing services will assist in gathering the needed paperwork, such as payroll records and monetary statements, to support your claim. They will also help calculate the credit amount based on qualified salaries and other certifying costs.
Retroactive Claim Evaluation: If you are qualified to claim the ERC for previous quarters, these business can review your past payroll records and financials to identify prospective opportunities for retroactive credits. They can assist you change previous tax returns to claim these refunds.
Filing Support: Business focusing on ERC filings will prepare and submit the needed types and documentation on your behalf. This includes completing Type 941 or any other necessary tax forms.
Compliance and Updates: ERC policies and assistance have evolved over time. These business remain updated with the current modifications and ensure that your filings comply with the most present standards. They can likewise offer ongoing assistance if the IRS demands extra info or carries out an audit related to your ERC claim.
It is necessary to research and vet any business using ERC filing help to guarantee their reliability and competence. Try to find established companies with experience in tax and payroll services, or consider connecting to relied on accounting firms or tax professionals who offer ERC submitting support.
Keep in mind that while these business can supply valuable support, it’s constantly a good idea to have a fundamental understanding of the ERC requirements and procedure yourself. This will assist you make informed decisions and ensure precise filings.
The Worker Retention Credit (ERC) is a refundable tax credit presented by the U.S. federal government as part of COVID-19 relief steps. The objective of the ERC is to encourage services to maintain and pay their employees throughout the pandemic, even if their operations have been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is readily available to qualified employers, including for-profit organizations, tax-exempt companies, and specific governmental entities. To certify, employers must fulfill one of two requirements:.
Business operations were totally or partly suspended due to a federal government order related to COVID-19.
The business experienced a substantial decline in gross invoices. As pointed out previously, for 2021, a substantial decline is defined as a 20% decline in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a considerable decline is specified as a 20% decrease in gross invoices compared to the very 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 company’s share of Social Security taxes. The credit amount amounts to a percentage (as much as 70%) of qualified earnings paid to employees, consisting of specific health plan expenses. The maximum credit per staff member is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, businesses that received a Paycheck Protection Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 allows businesses to claim the ERC even if they got a PPP loan. The exact same incomes 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 eligible companies to claim the credit for certified earnings paid as far back as March 13, 2020. This retroactive provision offers a chance for companies to modify prior-year income tax return and receive refunds.
Declaring the Credit: Companies can declare the ERC by reporting it on their employment income tax return, usually Form 941. The excess can be refunded to the employer if the credit exceeds the amount of employment taxes owed.
It is necessary to note that the ERC provisions and eligibility requirements have evolved with time. The best course of action is to consult with a tax professional or check out the official IRS site for the most in-depth and up-to-date details concerning the ERC, including any recent legal modifications or updates.
To receive the ERC, a service must meet among the following requirements:.
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 receipts. For 2021, a significant decline is specified as a 20% decrease in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a considerable decline is specified as a 20% decrease in gross receipts compared to the same quarter in 2019, or a 20% decrease in gross invoices compared to the immediately preceding quarter.
The ERC is available to organizations of all sizes, consisting of tax-exempt companies, however there are some exceptions. For instance, government entities and organizations that got a PPP loan might have restrictions on declaring the credit.
The process for claiming the ERC includes completing the needed types and consisting of the credit on your work income tax return (typically Kind 941). The exact time it takes to process the credit can vary based on numerous elements, including the intricacy of your service 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 a number of companies that can help with the procedure of declaring the ERC. Some widely known business that offer support with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the info offered here is based upon basic understanding and may not show the most recent updates or changes to the ERC. It is very important to consult with a tax professional or check out the main IRS website for the most current and accurate information regarding eligibility, claiming treatments, and available assistance.
Less than 100. If the company had 100 or fewer employees on average in 2019, then the credit is based.
on earnings paid to all employees whether they actually 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 staff members on average in 2019.
enabled only for salaries paid to workers who did not work throughout the calendar quarter.
In both cases, “incomes” includes not just cash payments however likewise a portion of the cost of employer.
provided healthcare. Employee Retention Credit Irma
Companies can be right away repaid for the credit by decreasing the amount of payroll taxes they.