Lets talk first about Employee Retention Credit Q3 2021 :
Our team here what do these guys doing everybody in this room is assisting teach individuals about ERC and uh always supply a lovely breakfast and have individuals truly discover the program we should head to the space where we have the ability to display a few of the checks that we are getting for companies 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 clients confirming that the check is on the way I suggest you know 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 imply it’s simply I imply think about how many 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 verified and the check is on the mail in the mail from the IRS heading to the client so that’s how you have the ability to track it you know when you
receive this you know the check is opted for sure and that’s when they pay so they do not pay anything until they in fact get the money they don’t pay bottom line Wonder trust anything up until this letter is validated the check is on the way they transfer it into their checking account and they can genuinely trust Wonder trust that the process has actually been ended up and the number of you believe you’ve processed because you began this we’re about 35 000 of these for
about six billion dollars wow so plainly they understand what they’re doing and that’s what you require you require professionals 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 discussing something really essential today the staff member retention credit which the majority of you have never ever become aware of I definitely had not become aware of it up until really recently and discovered a lot about it since this is probably the most affordable cost of capital for any small business anywhere
anytime if you have workers between 5 and five hundred so I’ve 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 hard this isn’t like PPP we just call your bank manager and say provide 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 become yes the Ambassador and paid representative for this I love this program it’s disappearing soon you got to discover all about it let’s talk staff member retention credit Josh Fox what is an ERC let’s simply begin there so throughout the Trump Administration when President Trump was enacted they created the cares Act and the cares act offered businesses 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.
correct the money cash payroll tax refund fine go on sorry I simply have to make sure we got that point I mean that’s a big difference a loan versus money money I like cash money that’s what we’re speaking about fine 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 lovely hard check in the mail where you get real cash from the IRS all right so let’s discuss how it works because it seems like to me if it’s a if it’s worker retention credit that individual needed to be a staff member so I’m going to make the Presumption this money is not for the owner not for people on the cap table not for investors it’s for workers right you had to have owned a company however it’s based upon 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 very 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 three of 2021. all right so that’s how it’s determined you need to be on the W-2 during that duration now let’s talk my preferred part money 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 specific Kevin is 50 of the employee’s wage to an optimum of 5 thousand dollars per worker 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 occur 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 employees 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 five thousand in twenty twenty that’s twenty six thousand dollars per staff member that is because 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 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 ten thousand dollars a person so let’s say hypothetically you owned a dining establishment in New York 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 IRS so it’s huge undoubtedly now the huge concern is why does nobody know about this because appearance when I initially heard about this when I first met Josh you understand I’ve got lots of financial investments in great deals of companies I’m a major advocate for entrepreneurship in America and make numerous lots of financial investments in entrepreneurs of which lots of suffered through the pandemic when I initially found out about this I called BS I do not think it since I utilize the PPP we went through the cash 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 been worthy of and we used them carefully to survive throughout the pandemic so when I became aware of this I stated nah it can’t be true however when I dug around I even called to my political leader pals Governor Senators they didn’t understand about it I indicate that’s how you understand that’s how false information is that there’s no information out there then a lot of people informed me well you can’t get it since you took the PPP also not real so let’s ask Josh why does no one learn about the staff member retention credit you understand what’s interesting you’re discussing the banks Kevin since in the PPP loan procedure 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 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 just process process that’s all um and here there was turmoil since remember in the initial cares act you might not do both programs so if you had done PPP you might refrain from doing ERC in the original program and when they altered the law in 2021 the banks were refraining from doing ERC since it’s not alone so you’re getting a tax refund so the government never made it clear to anyone about how to.
do this does your CFO understand 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 companies yeah a few of them are doing it as a payroll business your accountant no your accounting professional’s never ever done this prior to unless you have an account that entered into this service and bottom line my firm Kevin has been in business given that 2009 and we’ve been working with the federal government and the state federal government to recover money for Fortune 500 Fortune 1000 business so a great deal of our huge big business clients have worked with bottom line to recuperate other federal government programs we’ve done sales tax and utilize tax joblessness tax work chance tax credits research and development tax credits unclaimed property property tax all of these other government programs.
The staff member retention tax credit is a broad based refundable tax credit developed to encourage.
employers to keep employees on their payroll. The credit is 50% of approximately $10,000 in wages paid by an.
Because of COVID-19 or whose gross receipts, company whose business is completely or partially suspended.
decline by more than 50%.
Availability.
1. The credit is available to all companies regardless of size including tax exempt companies. There are.
just two exceptions: (1) state and local governments and their instrumentalities and (2) small.
services who take Small company Loans.
2. To qualify, the company has to meet one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the company’s service is fully or partly suspended by federal government order due to COVID-19.
during the calendar quarter or.
o the employer’s gross invoices are below 50% of the equivalent quarter in 2019. Once the.
company’s gross receipts exceed 80% of an equivalent 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 wages paid up to $10,000 in overall.
It works for salaries paid after March 13th and before December 31, 2020.
The meaning of certifying earnings varies by whether a company had, usually, basically than.
100 workers in 2019.
Business that concentrate on ERC filing support usually provide know-how and assistance to help services navigate the complicated procedure of declaring the credit. They can provide different services, including:.
How is the employee retention credit calculated? Employee Retention Credit Q3 2021
Eligibility Evaluation: These business will assess your business’s eligibility for the ERC based upon aspects such as your industry, income, and operations. They can assist figure out if you satisfy the requirements for the credit and determine the maximum credit quantity you can declare.
Documents and Computation: ERC filing services will assist in collecting the required documentation, such as payroll records and financial statements, to support your claim. They will also help calculate the credit amount based on eligible incomes and other qualifying expenditures.
Retroactive Claim Evaluation: If you are qualified to claim the ERC for prior quarters, these business can evaluate your past payroll records and financials to determine potential chances for retroactive credits. They can help you modify prior income tax return to claim these refunds.
Filing Assistance: Business specializing in ERC filings will prepare and submit the required types and paperwork on your behalf. This includes finishing Kind 941 or any other necessary tax forms.
Compliance and Updates: ERC policies and assistance have actually progressed gradually. These business stay upgraded with the current changes and ensure that your filings adhere to the most current standards. If the Internal revenue service demands extra info or performs an audit associated to your ERC claim, they can also offer continuous assistance.
It’s important to research study and veterinarian any business using ERC filing assistance to ensure their reliability and competence. Search for recognized companies with experience in tax and payroll services, or consider reaching out to trusted accounting firms or tax experts who use ERC filing support.
Bear in mind that while these business can supply valuable assistance, it’s constantly a great concept to have a basic understanding of the ERC requirements and process yourself. This will help you make notified choices and guarantee precise 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 procedures. The goal of the ERC is to motivate companies to keep and pay their employees throughout the pandemic, even if their operations have been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is offered to eligible employers, consisting of for-profit organizations, tax-exempt companies, and specific governmental entities. To certify, companies should fulfill one of two requirements:.
The business operations were totally or partly suspended due to a federal government order related to COVID-19.
Business experienced a considerable decline in gross receipts. As mentioned previously, for 2021, a significant decline is defined as a 20% decrease in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a considerable decline is defined as a 20% decrease in gross receipts compared to the 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 amount amounts to a portion (as much as 70%) of qualified earnings paid to staff members, consisting of certain health insurance expenditures. The optimum credit per staff member is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: At first, services that received an Income Protection Program (PPP) loan were not eligible for the ERC. However, legislation passed in late 2020 and extended in 2021 allows companies to declare the ERC even if they received a PPP loan. The very same earnings can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively broadened and enhanced, enabling eligible employers to claim the credit for certified wages paid as far back as March 13, 2020. This retroactive arrangement supplies a chance for services to amend prior-year income tax return and receive refunds.
Claiming the Credit: Companies can declare the ERC by reporting it on their work income tax return, generally Type 941. The excess can be refunded to the company if the credit exceeds the amount of employment taxes owed.
It’s important to keep in mind that the ERC provisions and eligibility criteria have actually developed in time. The very best course of action is to speak with a tax professional or go to the official IRS site for the most detailed and updated information relating to the ERC, consisting of any current legislative changes or updates.
To get approved for the ERC, an organization must meet among the following criteria:.
The 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 decrease is defined as a 20% decline in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a significant decline is defined as a 20% decrease in gross invoices compared to the very same quarter in 2019, or a 20% decrease in gross receipts compared to the immediately preceding quarter.
The ERC is available to businesses of all sizes, consisting of tax-exempt organizations, but there are some exceptions. Federal government entities and companies that received a PPP loan might have constraints on declaring the credit.
The process for claiming the ERC includes completing the required forms and consisting of the credit on your work tax return (normally Type 941). The exact time it takes to process the credit can vary based on numerous aspects, consisting of the complexity of your company and the workload of the internal revenue service. It’s suggested to seek advice from a tax expert for assistance specific to your scenario.
There are several companies that can help with the procedure of declaring the ERC. These consist of accounting firms, tax advisory services, and payroll provider. Some popular companies that use support with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s recommended to research study and get in touch with these business directly to ask about their services and charges.
Please note that the details provided here is based on general knowledge and may not reflect the most recent updates or modifications to the ERC. It’s important to consult with a tax professional or go to the main IRS site for the most current and precise information concerning eligibility, claiming treatments, and available assistance.
Less than 100. If the employer had 100 or fewer workers usually in 2019, then the credit is based.
on salaries paid to all staff members whether they in fact worked or not. In other words, even if the.
workers worked full-time and got paid for full time work, the company still gets the credit.
Greater than 100. If the employer had more than 100 workers usually in 2019, then the credit is.
allowed just for wages paid to employees who did not work during the calendar quarter.
In both cases, “salaries” consists of not simply money payments but also a part of the cost of employer.
provided healthcare. Employee Retention Credit Q3 2021
Payment.
Employers can be instantly reimbursed for the credit by lowering the amount of payroll taxes they.