Lets talk first about Employee Retention Credit Lookback :
Our team here what do these men doing everyone in this space is helping teach people about ERC and uh constantly supply a beautiful breakfast and have people actually learn more about the program we must head to the space where we have the ability to display a few 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 replicate copies of the letters that go to clients validating that the check is on the method I mean you understand if you simply begin to take a look at a few of these here I imply this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I mean it’s simply I suggest consider how many actual 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 client so that’s how you’re able to track it you know when you
get this you know the check is opted for sure and that’s when they pay so they don’t pay anything till they actually get the money they don’t pay bottom line Wonder trust anything till this letter is confirmed the check is on the method they deposit it into their bank account and they can really trust Wonder trust that the process has actually been completed and how many you think you’ve processed because you started 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 need you require 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 Terrific here you’re at my YouTube channel we’re speaking about something truly important today the employee retention credit which most of you have never ever heard of I definitely had not become aware of it until very just recently and discovered a lot about it because this is probably the most affordable expense of capital for any small company anywhere
anytime if you have workers 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 Ideas 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 just contact your bank supervisor and say give 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 ended up being yes the Ambassador and paid spokesperson for this I enjoy this program it’s going away soon you got to discover everything about it let’s talk worker retention credit Josh Fox what is an ERC let’s simply start there so throughout the Trump Administration when President Trump was enacted they created the cares Act and the cares act offered companies three chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and almost everybody it makes a big difference right there two of them are loans and one’s a refund precisely so the ERC is a refund that’s.
remedy the cash cash payroll tax refund okay go on sorry I just need to make certain we got that point I indicate that’s a big difference a loan versus cash money I like cash 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 beautiful difficult check in the mail where you get actual cash 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 staff member retention credit that person needed to be an employee so I’m going to make the Assumption this money is not for the owner not for individuals on the cap table not for shareholders it’s for staff members right you had to have owned a service however it’s based on you having W-2 workers 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 eligible so you need 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 stroll us through the six quarters so you had quarters two 3 and four of 2020 and you had quarters one 2 and 3 of 2021. alright so that’s how it’s determined you have to be on the W-2 during that duration now let’s talk my favorite part cash how much can you get back per employee that was on a W-2 in those 6 quarters so the calculation in 2020 to be exact Kevin is 50 of the staff member’s salary to an optimum of five thousand dollars per employee for the year of 2020 and in 2021 the numbers escalated to 70 of the staff member’s income to a maximum of seven thousand per quarter how did that take place um they simply changed the rules in.
2021 versus due to the fact that the turmoil 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 five thousand Max and then what occurs 21 000 Max in 2021 oh that’s how you develop twenty six thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty 6 thousand dollars per staff member 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 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 cash somewhere around 10 thousand dollars an individual so let’s say 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 huge undoubtedly now the huge concern is why does no one understand about this because look when I initially found out about this when I first fulfilled Josh you understand I have actually got lots of financial investments in lots of companies I’m a significant supporter for entrepreneurship in America and make many numerous financial investments in business owners of which numerous suffered through the pandemic when I first found out about this I called BS I do not believe 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 deserved and we utilized them sensibly to survive during the pandemic so when I became aware of this I stated nah it can’t be true but when I dug around I even contacted us to my political leader pals Guv Senators they didn’t learn about it I suggest that’s how you know 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 real so let’s ask Josh why does nobody learn about the employee retention credit you know 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 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 simply process procedure that’s all um and here there was chaos since keep in mind in the initial 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 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 anyone about how to.
do this does your CFO know how to do this not actually she or he’s never 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 accounting professional no your accountant’s never ever done this prior to unless you have an account that went into this service and bottom line my company Kevin has actually stayed in business given that 2009 and we’ve been working with the federal government and the state federal government to recuperate money for Fortune 500 Fortune 1000 business so a great deal of our big huge corporate clients have dealt with bottom line to recover other government programs we have actually done sales tax and use tax joblessness tax work chance tax credits research and development tax credits unclaimed home real estate tax all of these other government programs.
The worker retention tax credit is a broad based refundable tax credit created to motivate.
companies to keep employees on their payroll. The credit is 50% of as much as $10,000 in earnings paid by an.
company whose business is totally or partially suspended because of COVID-19 or whose gross receipts.
decline by more than 50%.
1. The credit is available to all employers despite size consisting of tax exempt companies. There are.
just two exceptions: (1) state and local governments and their instrumentalities and (2) little.
businesses who take Small Business Loans.
2. To qualify, the company has to meet one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the employer’s service is totally or partially suspended by government order due to COVID-19.
throughout the calendar quarter or.
o the employer’s gross invoices are listed below 50% of the comparable quarter in 2019. As soon as the.
company’s gross invoices exceed 80% of a similar quarter in 2019 they no longer certify.
after the end of that quarter.
Estimation of the Credit.
The quantity of the credit is 50% of the qualifying earnings paid up to $10,000 in total.
It works for earnings paid after March 13th and before December 31, 2020.
The meaning of certifying incomes varies by whether an employer had, usually, basically than.
100 employees in 2019.
Companies that specialize in ERC filing support typically provide knowledge and assistance to help organizations browse the complicated process of claiming the credit. They can offer different services, including:.
How is the employee retention credit calculated? Employee Retention Credit Lookback
Eligibility Assessment: These companies will assess your service’s eligibility for the ERC based upon factors such as your industry, earnings, and operations. They can help identify if you fulfill the requirements for the credit and recognize the optimum credit quantity you can declare.
Documents and Estimation: ERC filing services will help in gathering the needed documents, such as payroll records and financial statements, to support your claim. They will also help calculate the credit amount based on qualified incomes and other qualifying expenditures.
Retroactive Claim Evaluation: If you are qualified to claim the ERC for previous quarters, these business can evaluate your previous payroll records and financials to identify potential chances for retroactive credits. They can help you amend previous income tax return to claim these refunds.
Filing Help: Companies focusing on ERC filings will prepare and submit the needed types and documents in your place. This includes finishing Type 941 or any other required tax return.
Compliance and Updates: ERC guidelines and assistance have actually evolved with time. These companies stay updated with the current modifications and guarantee that your filings abide by the most current standards. They can also provide continuous assistance if the IRS demands extra information or conducts an audit related to your ERC claim.
It’s important to research study and vet any company using ERC filing support to guarantee their trustworthiness and knowledge. Look for recognized companies with experience in tax and payroll services, or consider connecting to trusted accounting firms or tax experts who use ERC submitting assistance.
Remember that while these companies can offer important help, it’s constantly an excellent concept to have a fundamental understanding of the ERC requirements and procedure yourself. This will assist you make notified choices and ensure 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 businesses to retain and pay their staff members throughout the pandemic, even if their operations have been impacted.
Here are some key points about the ERC:.
Eligibility: The ERC is available to eligible companies, including for-profit businesses, tax-exempt companies, and certain governmental entities. To certify, companies need to meet one of two requirements:.
The business operations were completely or partially suspended due to a government order related to COVID-19.
Business experienced a substantial decline in gross receipts. As mentioned earlier, for 2021, a considerable decline is defined as a 20% decrease in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a substantial decrease is defined as a 20% decrease in gross receipts compared to the very same quarter in 2019, or a 20% decrease in gross receipts compared to the instantly preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the employer’s share of Social Security taxes. The credit quantity amounts to a percentage (approximately 70%) of certified incomes paid to employees, including certain health plan expenditures. The optimum credit per worker 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 services to claim the ERC even if they received a PPP loan. Nevertheless, the exact same salaries can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively broadened and improved, allowing qualified companies to claim the credit for certified wages paid as far back as March 13, 2020. This retroactive provision supplies an opportunity for businesses to change prior-year income tax return and get refunds.
Claiming the Credit: Employers can claim the ERC by reporting it on their work tax returns, generally Type 941. The excess can be refunded to the employer if the credit goes beyond the quantity of employment taxes owed.
It is very important to note that the ERC arrangements and eligibility requirements have actually developed in time. The best strategy is to consult with a tax professional or check out the main IRS site for the most current and comprehensive information relating to the ERC, including any current legal changes or updates.
To get approved for the ERC, a business must satisfy among the following criteria:.
Business operations were totally or partly suspended due to a federal government order related to COVID-19.
Business experienced a considerable decrease in gross receipts. For 2021, a considerable decrease is defined as a 20% decrease in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a substantial decrease is defined as a 20% decline in gross invoices compared to the exact same quarter in 2019, or a 20% decline in gross invoices compared to the right away preceding quarter.
The ERC is readily available to services of all sizes, including tax-exempt companies, however there are some exceptions. Government entities and organizations that received a PPP loan may have restrictions on declaring the credit.
The process for declaring the ERC involves completing the essential types and including the credit on your employment tax return (normally Kind 941). The exact time it takes to process the credit can differ based upon several elements, including the complexity of your service and the work of the internal revenue service. It’s suggested to speak with a tax professional for assistance particular to your scenario.
There are a number of companies that can help with the process of claiming the ERC. Some well-known business that use support with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the details offered here is based on basic understanding and might not reflect the most recent updates or changes to the ERC. It is necessary to speak with a tax professional or go to the main internal revenue service website for the most updated and precise details concerning eligibility, claiming procedures, and offered help.
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 staff members whether they really worked or not. Simply put, even if the.
staff members worked full time and made money for full time work, the company still gets the credit.
Greater than 100. The credit is if the company had more than 100 staff members on average in 2019.
permitted only for salaries paid to workers who did not work throughout the calendar quarter.
In both cases, “earnings” consists of not simply money payments but likewise a portion of the cost of company.
supplied healthcare. Employee Retention Credit Lookback
Companies can be right away reimbursed for the credit by reducing the amount of payroll taxes they.