Lets talk first about Employee Retention Credit Related Individuals :
Our group here what do these people doing everyone in this space is assisting teach people about ERC and uh constantly supply a stunning breakfast and have individuals truly learn about the program we ought to head to the room where we are able to display a few of the checks that we are getting for business and I want to see that what is this this is uh hundreds of countless dollars literally Kevin hundreds of millions of dollars so these are duplicate copies of the letters that go to customers verifying that the check is on the method I indicate you understand if you simply begin to 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 mean consider how many actual clients that went through the program yeah this is the very end this is the party at the end when the check is verified 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 have the ability to track it you understand when you
receive this you know the check is opted for sure and that’s when they pay so they don’t pay anything until they in fact get the money they do not pay bottom line Wonder trust anything till this letter is confirmed the check is on the way they transfer it into their checking account and they can truly rely on Wonder trust that the procedure has actually been completed and the number of you believe you have actually processed given that you began this we’re about 35 000 of these for
about 6 billion dollars wow so clearly they know what they’re doing and that’s what you require you need 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 discussing something actually essential today the employee retention credit which the majority of you have actually never ever become aware of I definitely had not heard of it up until extremely recently and learned a lot about it because this is probably the most affordable cost of capital for any small business anywhere
anytime if you have employees between five and five hundred so I’ve got the specialist with me this is Josh Fox he’s the creator and CEO of bottom line Ideas they’re the largest processor of these ERC credits this is a 170 page program so it’s difficult this isn’t like PPP we just call your bank manager and say offer 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 like this program it’s going away very soon you got to learn everything 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 came up with the cares Act and the cares act used businesses 3 opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly everybody it makes a huge distinction right there 2 of them are loans and one’s a refund precisely so the ERC is a refund that’s.
fix the cash money payroll tax refund all right go on sorry I simply have to make certain we got that point I imply that’s a huge distinction a loan versus cash 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 lovely hard check in the mail where you get real cash from the internal revenue service all right so let’s speak about how it works because it sounds like to me if it’s a if it’s employee retention credit that individual needed to be an employee so I’m going to make the Assumption this cash is not for the owner not for people on the cap table not for investors it’s for workers right you needed to have actually owned a company however it’s based upon you having W-2 employees in America not 10.99. so as long as you had W-2 employees 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 need to be on payroll for the very first six 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 2 3 and four of 2020 and you had quarters one 2 and 3 of 2021. alright so that’s how it’s measured you need to be on the W-2 throughout that duration now let’s talk my preferred part money just how much can you get back per employee that was on a W-2 in those 6 quarters so the estimation in 2020 to be specific Kevin is 50 of the staff member’s income to a maximum of 5 thousand dollars per staff member for the year of 2020 and in 2021 the numbers increased to 70 of the employee’s salary to an optimum of 7 thousand per quarter how did that occur um they just altered 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 as much as five thousand Max and after that 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 employee that is because that’s a lot of money it is now there’s a caveat 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 lower the 26 000 so what we’re seeing on average Kevin is if you took PPP money someplace around ten thousand dollars a person so let’s say hypothetically you owned a restaurant in New york city City where I’m from and you had a hundred workers and you took PPP money you would still get a million dollar in the mail from the IRS so it’s big obviously now the huge question is why does nobody learn about this because look when I initially became aware of this when I initially met Josh you know I have actually got great deals of financial investments in great deals of companies I’m a significant advocate for entrepreneurship in America and make numerous numerous investments in entrepreneurs of which lots of suffered through the pandemic when I first became aware of this I called BS I don’t think it since I use the PPP we went through the money center Banks to get it it was really 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 wisely to stay alive during the pandemic so when I heard about this I stated nah it can’t hold true but when I dug around I even contacted us to my political leader friends Governor Senators they didn’t learn about it I imply that’s how you know that’s how misinformation is that there’s no information out there then a lot of people informed 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 nobody learn about the employee retention credit you understand what’s fascinating you’re speaking about the banks Kevin since in the PPP loan procedure 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 procedure process that’s all um and here there was turmoil due to the fact that keep in mind in the original cares act you could refrain from doing both programs so if you had done PPP you might not do ERC in the original program and when they changed the law in 2021 the banks were refraining from doing ERC because 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 understand how to do this not really he or she’s never done it previously do the banks do it nope the banks don’t do it the payroll business 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 went into this business and bottom line my company Kevin has actually been in business since 2009 and we have actually been dealing with the federal government and the state federal government to recuperate money for Fortune 500 Fortune 1000 business so a lot of our huge huge corporate customers have worked with bottom line to recuperate other government programs we have actually 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 federal government programs.
The worker retention tax credit is a broad based refundable tax credit created to encourage.
employers to keep staff members on their payroll. The credit is 50% of up to $10,000 in wages paid by an.
Since of COVID-19 or whose gross receipts, company whose business is completely or partially suspended.
decrease by more than 50%.
1. The credit is offered to all companies regardless of size including tax exempt organizations. There are.
only 2 exceptions: (1) state and local governments and their instrumentalities and (2) small.
businesses who take Small Business Loans.
2. To certify, the employer has to meet one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the employer’s business is totally or partially suspended by government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross invoices are below 50% of the comparable quarter in 2019. When the.
company’s gross receipts go above 80% of an equivalent quarter in 2019 they no longer qualify.
after the end of that quarter.
Calculation of the Credit.
The amount of the credit is 50% of the certifying earnings paid up to $10,000 in total.
It works for incomes paid after March 13th and prior to December 31, 2020.
The meaning of qualifying incomes differs by whether an employer had, typically, more or less than.
100 employees in 2019.
Companies that focus on ERC filing assistance usually offer proficiency and assistance to assist services navigate the complicated process of declaring the credit. They can provide different services, including:.
How is the employee retention credit calculated? Employee Retention Credit Related Individuals
Eligibility Evaluation: These companies will evaluate your business’s eligibility for the ERC based upon elements such as your industry, revenue, and operations. They can help identify if you fulfill the requirements for the credit and recognize the maximum credit amount you can claim.
Paperwork and Calculation: ERC filing services will assist in gathering the required documents, such as payroll records and monetary declarations, to support your claim. They will also assist compute the credit quantity based on qualified salaries and other qualifying expenses.
Retroactive Claim Review: If you are eligible to declare the ERC for prior quarters, these companies can evaluate your past payroll records and financials to determine possible chances for retroactive credits. They can help you amend prior income tax return to claim these refunds.
Filing Support: Business concentrating on ERC filings will prepare and send the required types and documents in your place. This consists of completing Kind 941 or any other required tax return.
Compliance and Updates: ERC regulations and assistance have actually progressed in time. These business remain updated with the most recent modifications and make sure that your filings adhere to the most existing guidelines. If the Internal revenue service requests additional info or conducts an audit related to your ERC claim, they can also supply ongoing assistance.
It is very important to research and veterinarian any company offering ERC filing help to ensure their credibility and expertise. Search for recognized companies with experience in tax and payroll services, or consider reaching out to trusted accounting companies or tax professionals who offer ERC submitting assistance.
Remember that while these companies can supply valuable assistance, it’s constantly a great concept to have a standard understanding of the ERC requirements and process yourself. This will assist you make notified 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 goal of the ERC is to encourage companies to keep and pay their employees throughout the pandemic, even if their operations have actually been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is offered to eligible companies, including for-profit companies, tax-exempt companies, and certain governmental entities. To qualify, companies must fulfill one of two requirements:.
The business operations were fully or partially suspended due to a federal government order related to COVID-19.
The business experienced a significant decrease in gross receipts. As mentioned previously, for 2021, a substantial decline is specified as a 20% decrease in gross receipts compared to the 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% decline in gross receipts compared to the immediately preceding quarter.
Credit Quantity: 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 (up to 70%) of certified incomes paid to staff members, including specific health plan expenditures. The maximum credit per employee 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 Security Program (PPP) loan were not qualified for the ERC. However, legislation passed in late 2020 and extended in 2021 enables businesses to claim the ERC even if they received a PPP loan. The same salaries can not be utilized to claim 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 supplies an opportunity for businesses to change prior-year tax returns and receive refunds.
Declaring the Credit: Companies can claim the ERC by reporting it on their work income tax return, typically Type 941. The excess can be refunded to the employer if the credit surpasses the quantity of employment taxes owed.
It is necessary to keep in mind that the ERC arrangements and eligibility criteria have evolved over time. The very best strategy is to consult with a tax professional or check out the main internal revenue service site for the most updated and detailed details regarding the ERC, including any current legal changes or updates.
To qualify for the ERC, an organization must meet among the following criteria:.
Business operations were completely or partly suspended due to a government order related to COVID-19.
The business experienced a significant decline in gross invoices. For 2021, a considerable decline is defined as a 20% decline in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a significant decline is specified as a 20% decline in gross receipts compared to the exact same quarter in 2019, or a 20% decrease in gross invoices compared to the immediately preceding quarter.
The ERC is available to companies of all sizes, including tax-exempt organizations, but there are some exceptions. For instance, federal government entities and companies that got a PPP loan might have restrictions on claiming the credit.
The process for declaring the ERC involves completing the needed types and consisting of the credit on your work income tax return (normally Type 941). The exact time it takes to process the credit can differ based on a number of factors, consisting of the intricacy of your service and the work of the IRS. It’s recommended to speak with a tax professional for guidance particular to your circumstance.
There are several companies that can help with the process of claiming the ERC. These include accounting companies, tax advisory services, and payroll service providers. Some well-known companies that provide support with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s recommended to research study and get in touch with these companies directly to inquire about their charges and services.
Please note that the details offered here is based upon basic understanding and might not reflect the most current updates or modifications to the ERC. It is necessary to consult with a tax expert or check out the official IRS website for the most up-to-date and accurate details relating to eligibility, declaring treatments, and available help.
Less than 100. If the company had 100 or less workers on average in 2019, then the credit is based.
on wages paid to all employees whether they actually worked or not. In other words, even if the.
staff members worked full-time and earned 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.
enabled only for earnings paid to workers who did not work during the calendar quarter.
In both cases, “incomes” consists of not just cash payments but likewise a portion of the expense of employer.
provided healthcare. Employee Retention Credit Related Individuals
Companies can be right away compensated for the credit by minimizing the amount of payroll taxes they.