Lets talk first about Employee Retention Credit Ppp2 :
Our team here what do these guys doing everyone in this room is helping teach individuals about ERC and uh always provide a gorgeous breakfast and have people really learn about the program we should head to the room where we have the ability to display 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 verifying that the check is on the way I mean you understand if you just start 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 suggest it’s just I indicate think about how many real clients 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 validated 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
receive this you understand the check is gone for sure which’s when they pay so they do not pay anything up until they really receive the money 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 genuinely trust Wonder trust that the process has been finished and how many you believe you have actually processed since you began this we’re about 35 000 of these for
about six billion dollars wow so plainly they understand what they’re doing which’s what you need you need professionals 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 talking about something truly essential today the employee retention credit which the majority of you have actually never become aware of I definitely hadn’t become aware of it till extremely just recently and found out a lot about it due to the fact that this is probably the lowest expense of capital for any small company anywhere
anytime if you have employees in between 5 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 Principles they’re the biggest processor of these ERC credits this is a 170 page program so it’s hard this isn’t like PPP we simply call your bank manager and say 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’ve become yes the Ambassador and paid spokesperson for this I love this program it’s going away soon you got to learn all about it let’s talk employee retention credit Josh Fox what is an ERC let’s just start there so throughout the Trump Administration when President Trump was enacted they developed the cares Act and the cares act provided organizations 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 big 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 money payroll tax refund okay go on sorry I just need to ensure we got that point I indicate that’s a big distinction a loan versus cash money I like money money that’s what we’re talking about 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 original cares Act is the ERC and yes Kevin it is a stunning difficult check in the mail where you get actual cash from the internal revenue service all right so let’s discuss 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 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 investors it’s for employees right you needed to have owned a business but it’s based upon you having W-2 workers 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 eligible so you have to be on payroll in 2020 on the W-2 and you have to be on payroll for the very first 6 months of 2021 on the W-2 appropriate so there were six quarters the program was open well stroll us through the 6 quarters so you had quarters two three and 4 of 2020 and you had quarters one two and three of 2021. alright so that’s how it’s determined you have to be on the W-2 throughout that duration now let’s talk my favorite part cash just how much can you return per employee that was on a W-2 in those six quarters so the calculation in 2020 to be specific Kevin is 50 of the worker’s salary to an optimum of 5 thousand dollars per staff member for the year of 2020 and in 2021 the numbers escalated to 70 of the staff member’s income to a maximum of 7 thousand per quarter how did that take place um they simply altered the rules in.
2021 versus because the turmoil of the pandemic so they wanted 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 happens 21 000 Max in 2021 oh that’s how you create 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 since that’s a lot of cash it is now there’s a caution here the PPP cash would need to be reduced from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan 2 you would decrease the 26 000 so what we’re seeing on average Kevin is if you took PPP cash someplace 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 workers and you took PPP cash you would still get a million dollar in the mail from the IRS so it’s substantial obviously now the huge concern is why does nobody understand about this due to the fact that appearance when I first found out about this when I initially met Josh you understand I have actually got great deals of investments in lots of companies I’m a major advocate for entrepreneurship in America and make many many 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 due to the fact that 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 which were well been worthy of and we utilized them carefully to survive throughout the pandemic so when I found out about this I said nah it can’t hold true but when I dug around I even contacted us to my politician pals Guv Senators they didn’t learn about it I mean that’s how you understand 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 because you took the PPP likewise not real so let’s ask Josh why does no one learn about the employee retention credit you know what’s intriguing you’re talking about the banks Kevin since in the PPP loan procedure the federal government made it very clear that if you wanted a PPP loan you would call Wells Fargo Citibank Bank of America any of the big 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 simply process process that’s all um and here there was mayhem due to the fact that remember in the initial 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 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 federal government never made it clear to anyone about how to.
do this does your CFO know 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 company your accounting professional no your accountant’s never done this before unless you have an account that went into this company and bottom line my company Kevin has stayed in business because 2009 and we have actually been dealing with the federal government and the state federal government to recover cash for Fortune 500 Fortune 1000 companies so a great deal of our big huge corporate clients have dealt with bottom line to recover other government programs we’ve done sales tax and use tax joblessness tax work opportunity 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 designed to motivate.
companies to keep workers on their payroll. The credit is 50% of up to $10,000 in earnings paid by an.
Due to the fact that of COVID-19 or whose gross receipts, company whose service is totally or partly suspended.
decrease by more than 50%.
1. The credit is available to all employers despite size consisting of tax exempt companies. There are.
just 2 exceptions: (1) state and local governments and their instrumentalities and (2) small.
companies who take Small Business Loans.
2. To qualify, the company needs to fulfill one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the company’s business is totally or partly suspended by federal government order due to COVID-19.
during the calendar quarter or.
o the company’s gross invoices are listed below 50% of the comparable quarter in 2019. When the.
employer’s gross receipts exceed 80% of a similar 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 qualifying earnings paid up to $10,000 in total.
It works for earnings paid after March 13th and prior to December 31, 2020.
The meaning of certifying wages differs by whether an employer had, usually, basically than.
100 staff members in 2019.
Business that specialize in ERC filing assistance typically offer competence and assistance to assist services browse the intricate procedure of claiming the credit. They can use various services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit Ppp2
Eligibility Assessment: These companies will evaluate your business’s eligibility for the ERC based upon factors such as your market, profits, and operations. If you fulfill the requirements for the credit and identify the optimum credit amount you can declare, they can assist figure out.
Documents and Estimation: ERC filing services will assist in collecting the needed documents, such as payroll records and monetary statements, to support your claim. They will also help calculate the credit quantity based upon qualified earnings and other qualifying costs.
Retroactive Claim Review: If you are eligible to claim the ERC for previous quarters, these companies can evaluate your past payroll records and financials to identify potential chances for retroactive credits. They can help you modify previous tax returns to claim these refunds.
Filing Assistance: Business specializing in ERC filings will prepare and send the needed forms and documents in your place. This includes completing Type 941 or any other required tax return.
Compliance and Updates: ERC policies and assistance have evolved over time. These companies stay updated with the current modifications and guarantee that your filings abide by the most present guidelines. If the Internal revenue service requests additional details or performs an audit related to your ERC claim, they can also offer continuous assistance.
It is essential to research study and veterinarian any business providing ERC filing support to ensure their reliability and expertise. Look for recognized companies with experience in tax and payroll services, or consider connecting to trusted accounting firms or tax professionals who use ERC submitting support.
Keep in mind that while these companies can supply valuable help, it’s always a great idea to have a fundamental understanding of the ERC requirements and procedure yourself. This will assist you make informed decisions and ensure accurate filings.
The Worker Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief steps. The goal of the ERC is to encourage organizations to keep and pay their staff members during the pandemic, even if their operations have actually been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is readily available to eligible employers, including for-profit businesses, tax-exempt organizations, and specific governmental entities. To qualify, companies should meet one of two requirements:.
Business operations were fully or partially suspended due to a government order related to COVID-19.
The business experienced a substantial decline in gross invoices. As discussed previously, for 2021, a considerable decrease is defined as a 20% decrease in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a significant decrease is defined as a 20% decline in gross receipts compared to the same quarter in 2019, or a 20% decrease in gross receipts compared to the instantly 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 certified wages paid to workers, including certain health insurance costs. The optimum credit per worker 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 eligible for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 permits companies to claim the ERC even if they got a PPP loan. Nevertheless, the very same wages can not be utilized to claim both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has actually been retroactively expanded and boosted, enabling qualified companies to claim the credit for qualified wages paid as far back as March 13, 2020. This retroactive arrangement supplies a chance for businesses to change prior-year income tax return and receive refunds.
Claiming the Credit: Employers can declare the ERC by reporting it on their work tax returns, normally Type 941. The excess can be reimbursed to the company if the credit exceeds the amount of work taxes owed.
It’s important to note that the ERC arrangements and eligibility requirements have evolved over time. The very best strategy is to talk to a tax expert or check out the main internal revenue service site for the most up-to-date and detailed information regarding the ERC, including any current legislative modifications or updates.
To receive the ERC, an organization needs to meet one of the following criteria:.
The 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. For 2021, a considerable decline is defined as a 20% decline in gross invoices 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 exact same quarter in 2019, or a 20% decrease in gross receipts compared to the right away preceding quarter.
The ERC is readily available to services of all sizes, including tax-exempt organizations, but there are some exceptions. Federal government entities and companies that received a PPP loan might have constraints on claiming the credit.
The procedure for claiming the ERC involves completing the essential forms and consisting of the credit on your work income tax return (typically Form 941). The exact time it takes to process the credit can differ based upon a number of aspects, including the complexity of your organization and the workload of the IRS. It’s suggested to speak with a tax professional for assistance particular to your circumstance.
There are numerous business that can help with the process of claiming the ERC. These include accounting firms, tax advisory services, and payroll provider. Some widely known companies that provide help with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s recommended to research and get in touch with these companies directly to inquire about their services and costs.
Please keep in mind that the info provided here is based on general understanding and may not show the most recent updates or changes to the ERC. It is very important to talk to a tax expert or visit the official IRS site for the most up-to-date and accurate information relating to eligibility, claiming procedures, and available support.
Less than 100. The credit is based if the company had 100 or less employees on average in 2019.
on wages paid to all workers whether they really worked or not. In other words, even if the.
workers worked full-time and made money for full-time work, the company still gets the credit.
Greater than 100. If the employer had more than 100 staff members usually in 2019, then the credit is.
allowed just for incomes paid to employees who did not work during the calendar quarter.
In both cases, “incomes” includes not simply cash payments but also a portion of the expense of company.
provided healthcare. Employee Retention Credit Ppp2
Companies can be right away reimbursed for the credit by lowering the quantity of payroll taxes they.