Lets talk first about Employee Retention Credit Owner Wages S Corp :
Our team here what do these guys doing everybody in this room is assisting teach people about ERC and uh always provide a lovely breakfast and have people really find out about the program we should head to the room where we have the ability to show a few of the checks that we are getting for business and I wish to see that what is this this is uh hundreds of countless dollars literally Kevin hundreds of countless dollars so these are duplicate copies of the letters that go to customers validating that the check is on the way I indicate you know if you simply start to look at some of these here I mean this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I imply it’s simply I mean think about how many real customers 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 verified and the check is on the mail in the mail from the IRS heading to the customer so that’s how you’re able to track it you understand when you
get this you know the check is gone for sure which’s when they pay so they do not pay anything till they actually 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 savings account and they can truly trust Wonder trust that the process 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 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 among these that’s what matters all right Mr Terrific here you’re at my YouTube channel we’re speaking about something truly essential today the staff member retention credit which the majority of you have never become aware of I definitely had not become aware of it up until extremely 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 5 and five hundred so I have actually got the expert with me this is Josh Fox he’s the founder and CEO of bottom line Principles they’re the biggest processor of these ERC credits this is a 170 page program so it’s not easy this isn’t like PPP we just call your bank supervisor and state give me a loan it doesn’t work there’s not a loan it’s an application and Josh is going to inform us all about it and how to get it and why I have actually become yes the Ambassador and paid representative for this I enjoy this program it’s going away soon you got to learn all about it let’s talk staff member retention credit Josh Fox what is an ERC let’s just start there so throughout the Trump Administration when President Trump was enacted they came up with the cares Act and the cares act used services 3 chances 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 exactly so the ERC is a refund that’s.
correct the money cash payroll tax refund fine go on sorry I just have to ensure we got that point I indicate that’s a huge difference a loan versus cash money I like money money that’s what we’re discussing 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 gorgeous hard check in the mail where you get actual cash from the internal revenue service all right so let’s discuss 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 had to be a staff member so I’m going to make the Presumption this money is not for the owner not for individuals on the cap table not for shareholders it’s for workers right you had to have owned a company however it’s based upon 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 six quarters so you had quarters two three and four of 2020 and you had quarters one two and three of 2021. okay so that’s how it’s determined you have to be on the W-2 throughout that period now let’s talk my favorite part cash just how much can you return per worker that was on a W-2 in those six quarters so the estimation in 2020 to be precise Kevin is 50 of the worker’s salary to a maximum of 5 thousand dollars per employee for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the worker’s income to a maximum of 7 thousand per quarter how did that happen um they just altered 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 5 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 five thousand in twenty twenty that’s twenty 6 thousand dollars per staff member that is because that’s a great deal of money it is now there’s a caveat here the PPP cash would need to be reduced from the twenty six thousand dollars so if you took PPP loan one and PPP loan two you would minimize the 26 000 so what we’re seeing usually Kevin is if you took PPP money someplace around 10 thousand dollars a person so let’s say hypothetically you owned a dining establishment in New york city City where I’m from and you had a hundred staff members and you took PPP money you would still get a million dollar in the mail from the internal revenue service so it’s huge certainly now the big concern is why does no one learn about this because look when I first heard about this when I first met Josh you understand I’ve got great deals of financial investments in lots of business I’m a major supporter for entrepreneurship in America and make lots of many financial investments in business owners of which numerous suffered through the pandemic when I first heard about this I called BS I do not think it because I utilize the PPP we went through the cash 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 wisely to survive throughout 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 good friends Guv Senators they didn’t know about it I imply that’s how you understand that’s how misinformation is that there’s no information out there then a bunch of people told me well you can’t get it due to the fact that you took the PPP likewise not true so let’s ask Josh why does no one learn about the employee retention credit you understand what’s intriguing you’re talking about the banks Kevin because 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 just process process that’s all um and here there was turmoil since keep in mind in the original cares act you could not do both programs so if you had done PPP you could refrain from doing ERC in the original program and when they altered the law in 2021 the banks were not doing ERC since 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 she or he’s never 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 accounting professional no your accountant’s never ever done this before unless you have an account that entered into this company and bottom line my firm Kevin has been in business because 2009 and we’ve been dealing with the federal government and the state federal government to recuperate cash for Fortune 500 Fortune 1000 business so a lot of our huge huge corporate clients have dealt with bottom line to recuperate other government programs we’ve done sales tax and use tax joblessness tax work opportunity tax credits research and development tax credits unclaimed property real estate tax all of these other federal government programs.
The staff member retention tax credit is a broad based refundable tax credit designed to encourage.
employers to keep staff members 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, employer whose business is totally or partly suspended.
decline by more than 50%.
Accessibility.
1. The credit is readily available to all companies regardless of size consisting of tax exempt companies. There are.
just 2 exceptions: (1) state and local governments and their instrumentalities and (2) little.
businesses who take Small company Loans.
2. To qualify, the employer needs to satisfy one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the company’s organization is totally or partly suspended by government order due to COVID-19.
during the calendar quarter or.
o the company’s gross receipts are listed below 50% of the similar quarter in 2019. Once the.
company’s gross receipts go above 80% of an equivalent quarter in 2019 they no longer certify.
after completion 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 salaries paid after March 13th and prior to December 31, 2020.
The definition of qualifying wages varies by whether an employer had, usually, more or less than.
100 workers in 2019.
Companies that concentrate on ERC filing support usually provide knowledge and assistance to assist organizations navigate the complicated procedure of claiming the credit. They can offer different services, including:.
How is the employee retention credit calculated? Employee Retention Credit Owner Wages S Corp
Eligibility Assessment: These companies will assess your organization’s eligibility for the ERC based upon aspects such as your industry, revenue, and operations. They can help determine if you fulfill the requirements for the credit and identify the maximum credit amount you can claim.
Paperwork and Computation: ERC filing services will assist in collecting the required documents, such as payroll records and monetary statements, to support your claim. They will also assist compute 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 examine your previous payroll records and financials to identify potential chances for retroactive credits. They can assist you modify prior tax returns to declare these refunds.
Filing Support: Companies specializing in ERC filings will prepare and send the required types and paperwork on your behalf. This includes finishing Kind 941 or any other required tax forms.
Compliance and Updates: ERC regulations and guidance have developed with time. These companies stay upgraded with the most recent changes and guarantee that your filings comply with the most current guidelines. If the Internal revenue service demands additional details or performs an audit associated to your ERC claim, they can also supply ongoing support.
It is essential to research and veterinarian any company using ERC filing support to ensure their trustworthiness and expertise. Try to find established firms with experience in tax and payroll services, or think about reaching out to relied on accounting companies or tax professionals who use ERC filing support.
Bear in mind that while these companies can provide valuable support, it’s constantly a good concept to have a basic understanding of the ERC requirements and procedure yourself. This will assist you make notified decisions and ensure precise filings.
The Employee Retention Credit (ERC) is a refundable tax credit presented by the U.S. government as part of COVID-19 relief measures. The objective of the ERC is to motivate services to retain and pay their employees 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 employers, including for-profit organizations, tax-exempt organizations, and particular governmental entities. To qualify, companies must fulfill one of two criteria:.
The business operations were completely or partially suspended due to a government order related to COVID-19.
The business experienced a substantial decrease in gross receipts. As mentioned earlier, for 2021, a substantial decline is specified as a 20% decrease in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a significant decline is specified as a 20% decline in gross invoices compared to the exact same quarter in 2019, or a 20% decrease 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 amount amounts to a percentage (approximately 70%) of certified incomes paid to employees, including certain health insurance costs. 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, services that got a Paycheck Protection Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 enables services to claim the ERC even if they got a PPP loan. The exact same wages can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively expanded and boosted, permitting qualified companies to claim the credit for certified earnings paid as far back as March 13, 2020. This retroactive arrangement offers a chance for services to modify prior-year income tax return and get refunds.
Claiming the Credit: Companies can claim the ERC by reporting it on their work tax returns, typically Form 941. If the credit surpasses the quantity of work taxes owed, the excess can be refunded to the company.
It’s important to note that the ERC arrangements and eligibility criteria have actually developed in time. The very best course of action is to seek advice from a tax expert or go to the official IRS website for the most updated and comprehensive details concerning the ERC, including any recent legal changes or updates.
To receive the ERC, an organization needs to satisfy one of the following criteria:.
Business operations were completely or partly suspended due to a federal government order related to COVID-19.
Business experienced a considerable decline in gross invoices. For 2021, a significant decline is defined as a 20% decrease in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a significant decline is specified as a 20% decline in gross invoices compared to the same quarter in 2019, or a 20% decrease in gross receipts compared to the instantly preceding quarter.
The ERC is readily available to organizations of all sizes, consisting of tax-exempt organizations, however there are some exceptions. For instance, government entities and companies that got a PPP loan might have restrictions on declaring the credit.
The procedure for claiming the ERC involves completing the necessary types and including the credit on your employment tax return (usually Type 941). The exact time it requires to process the credit can vary based upon a number of factors, including the intricacy of your organization and the work of the internal revenue service. It’s advised to seek advice from a tax professional for guidance specific to your situation.
There are numerous companies that can assist with the procedure of declaring the ERC. Some widely known business that use assistance with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the information offered here is based upon general knowledge and may not reflect the most recent updates or modifications to the ERC. It is essential to talk to a tax professional or check out the main internal revenue service website for the most accurate and up-to-date info regarding eligibility, claiming procedures, and available support.
Less than 100. The credit is based if the employer had 100 or fewer staff members on average in 2019.
on incomes paid to all workers whether they in fact worked or not. In other words, even if the.
employees worked full time and got paid for full time work, the employer still gets the credit.
Greater than 100. The credit is if the company had more than 100 employees on average in 2019.
allowed just for wages paid to staff members who did not work throughout the calendar quarter.
In both cases, “incomes” includes not simply cash payments but also a part of the cost of employer.
offered healthcare. Employee Retention Credit Owner Wages S Corp
Payment.
Companies can be right away compensated for the credit by reducing the amount of payroll taxes they.