Lets talk first about Employee Retention Credit S Corporation :
Our team here what do these people doing everyone in this room is helping teach individuals about ERC and uh always supply a beautiful breakfast and have people really discover the program we need to head to the room where we are able to show some 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 replicate copies of the letters that go to clients verifying that the check is on the way I suggest you understand if you just start to take a look at a few of these here I suggest this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I suggest it’s just I suggest think about the number of 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 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 understand when you
receive this you understand the check is gone for sure and that’s when they pay so they do not pay anything till they really receive the money they do not pay bottom line Wonder trust anything until this letter is verified the check is on the way they deposit it into their bank account and they can truly trust Wonder trust that the procedure has been finished and the number of you think you have actually processed since you began this we have to do with 35 000 of these for
about 6 billion dollars wow so clearly they understand what they’re doing and that’s what you need you need specialists 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 speaking about something actually crucial today the staff member retention credit which most of you have never heard of I definitely hadn’t become aware of it up until extremely recently and found out a lot about it because this is most likely the lowest expense of capital for any small company 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 founder and CEO of bottom line Ideas they’re the largest processor of these ERC credits this is a 170 page program so it’s not easy this isn’t like PPP we simply contact your bank supervisor and state give me a loan it does not work there’s not a loan it’s an application and Josh is going to inform all of us 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 very soon you got to learn 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 came up with the cares Act and the cares act provided businesses 3 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 distinction right there 2 of them are loans and one’s a refund precisely so the ERC is a refund that’s.
fix the money money payroll tax refund fine go on sorry I simply have to make certain we got that point I imply that’s a huge difference a loan versus cash money I like cash cash 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 initial cares Act is the ERC and yes Kevin it is a lovely difficult check in the mail where you get real cash from the internal revenue service all right so let’s speak about how it works since it seems like to me if it’s a if it’s worker retention credit that person had to be a staff member so I’m going to make the Assumption this money 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 but it’s based upon you having W-2 employees 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 six 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 4 of 2020 and you had quarters one 2 and 3 of 2021. all right so that’s how it’s measured you need to be on the W-2 throughout that duration now let’s talk my favorite part money just how much can you return per employee that was on a W-2 in those six quarters so the estimation in 2020 to be exact Kevin is 50 of the employee’s income to an optimum of 5 thousand dollars per employee for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the worker’s wage to an optimum of seven thousand per quarter how did that take place 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 employees on payroll 100 so if you can get 5 000 per person Max in twenty that was 50 in 2020 up to 5 thousand Max and after that what takes place 21 000 Max in 2021 oh that’s how you come up with twenty 6 thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty six thousand dollars per staff member that is because that’s a lot of money it is now there’s a caution here the PPP cash would need to be minimized from the twenty six thousand dollars so if you took PPP loan one and PPP loan 2 you would reduce the 26 000 so what we’re seeing on average Kevin is if you took PPP cash 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 workers 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 question is why does nobody learn about this because appearance when I first became aware of this when I first fulfilled Josh you know I have actually got great deals of investments in great deals of business I’m a significant supporter for entrepreneurship in America and make numerous lots of financial investments in business owners of which numerous suffered through the pandemic when I first heard about this I called BS I don’t 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 which were well deserved and we used them sensibly to stay alive throughout the pandemic so when I heard about this I said nah it can’t hold true but when I dug around I even called to my political leader pals Guv Senators they didn’t learn about it I suggest that’s how you understand that’s how misinformation is that there’s no information out there then a lot of people told me well you can’t get it because you took the PPP likewise not true so let’s ask Josh why does no one know about the staff member retention credit you understand what’s fascinating you’re speaking about the banks Kevin because in the PPP loan procedure the federal government made it really clear that if you wanted a PPP loan you would call Wells Fargo Citibank Bank of America any of the big banks in our nation 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 mayhem because keep in mind in the initial cares act you could refrain from doing both programs so if you had done PPP you might refrain from doing ERC in the initial program and when they altered 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 any person about how to.
do this does your CFO know how to do this not really he or she’s never ever 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 company your accounting professional no your accounting professional’s never ever done this before unless you have an account that went into this company and bottom line my firm Kevin has stayed in business since 2009 and we’ve been working with the federal government and the state government to recuperate cash for Fortune 500 Fortune 1000 companies so a great deal of our big big business clients have actually worked with bottom line to recover other federal 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 employee retention tax credit is a broad based refundable tax credit developed to encourage.
companies to keep workers on their payroll. The credit is 50% of as much as $10,000 in wages paid by an.
Because of COVID-19 or whose gross invoices, company whose organization is fully or partly suspended.
decrease by more than 50%.
1. The credit is offered to all companies regardless of size consisting of tax exempt companies. There are.
only 2 exceptions: (1) state and city governments and their instrumentalities and (2) small.
services who take Small company Loans.
2. To qualify, the company needs to satisfy one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the company’s company is fully or partially suspended by federal government order due to COVID-19.
during the calendar quarter or.
o the company’s gross receipts are listed below 50% of the equivalent quarter in 2019. Once 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 is effective for incomes paid after March 13th and before December 31, 2020.
The definition of certifying earnings differs by whether a company had, on average, more or less than.
100 employees in 2019.
Companies that focus on ERC filing assistance normally offer proficiency and support to assist services browse the complex procedure of declaring the credit. They can provide different services, including:.
How is the employee retention credit calculated? Employee Retention Credit S Corporation
Eligibility Evaluation: These companies will examine your company’s eligibility for the ERC based on aspects such as your market, income, and operations. They can help figure out if you meet the requirements for the credit and determine the optimum credit amount you can claim.
Documentation and Calculation: ERC filing services will assist in collecting the necessary documents, such as payroll records and monetary statements, to support your claim. They will also assist compute the credit quantity based on qualified salaries and other qualifying costs.
Retroactive Claim Evaluation: If you are eligible to claim the ERC for previous quarters, these companies can examine your past payroll records and financials to determine possible chances for retroactive credits. They can help you amend prior tax returns to declare these refunds.
Filing Support: Companies specializing in ERC filings will prepare and submit the necessary kinds and paperwork in your place. This consists of finishing Type 941 or any other necessary tax forms.
Compliance and Updates: ERC guidelines and assistance have actually developed with time. These business remain updated with the latest changes and ensure that your filings abide by the most present guidelines. If the IRS demands extra details or conducts an audit associated to your ERC claim, they can likewise offer ongoing support.
It is very important to research study and veterinarian any business offering ERC filing assistance to guarantee their trustworthiness and competence. Try to find recognized firms with experience in tax and payroll services, or consider reaching out to trusted accounting firms or tax experts who use ERC filing assistance.
Keep in mind that while these companies can provide important assistance, it’s constantly a great idea to have a basic understanding of the ERC requirements and process yourself. This will assist you make informed 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 procedures. The goal of the ERC is to encourage organizations to retain and pay their workers during the pandemic, even if their operations have actually been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is available to qualified companies, including for-profit businesses, tax-exempt organizations, and certain governmental entities. To certify, employers must satisfy one of two criteria:.
Business operations were totally or partially suspended due to a government order related to COVID-19.
Business experienced a substantial decrease in gross receipts. As discussed earlier, for 2021, a substantial decrease is defined as a 20% decrease in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a significant decline is defined as a 20% decline in gross receipts compared to the very 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 quantity is equal to a percentage (as much as 70%) of qualified wages paid to staff members, including particular health plan expenses. 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, businesses that got an Income Defense Program (PPP) loan were not qualified for the ERC. However, legislation passed in late 2020 and extended in 2021 enables services to declare the ERC even if they received a PPP loan. Nevertheless, the same incomes can not be utilized 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 qualified earnings paid as far back as March 13, 2020. This retroactive arrangement provides a chance for organizations to change prior-year income tax return and receive refunds.
Declaring the Credit: Employers can claim the ERC by reporting it on their employment income tax return, typically Type 941. The excess can be reimbursed to the company if the credit goes beyond the amount of employment taxes owed.
It is necessary to keep in mind that the ERC arrangements and eligibility criteria have progressed with time. The very best strategy is to speak with a tax expert or go to the main internal revenue service site for the most current and comprehensive details regarding the ERC, consisting of any recent legal changes or updates.
To receive the ERC, a company needs to meet among the following criteria:.
The business operations were completely or partially suspended due to a federal government order related to COVID-19.
The business experienced a considerable decline in gross invoices. For 2021, a considerable decline is specified as a 20% decline in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a significant decrease is defined as a 20% decrease in gross receipts compared to the exact same quarter in 2019, or a 20% decline in gross receipts compared to the immediately preceding quarter.
The ERC is readily available to companies of all sizes, including tax-exempt organizations, but there are some exceptions. Federal government entities and businesses that got a PPP loan may have restrictions on claiming the credit.
The process for declaring the ERC includes completing the required types and consisting of the credit on your work income tax return (generally Type 941). The exact time it takes to process the credit can vary based upon several aspects, including the intricacy of your company and the workload of the internal revenue service. It’s suggested to talk to a tax professional for assistance specific to your scenario.
There are several business that can assist with the procedure of claiming the ERC. Some widely known business that offer help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the information offered here is based on general understanding and may not reflect the most current updates or changes to the ERC. It is essential to speak with a tax expert or check out the main internal revenue service website for the most precise and up-to-date information relating to eligibility, claiming procedures, and readily available assistance.
Less than 100. The credit is based if the employer had 100 or less workers on average in 2019.
on wages paid to all staff members whether they actually worked or not. In other words, even if the.
employees 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.
enabled only for earnings paid to staff members who did not work during the calendar quarter.
In both cases, “incomes” includes not just cash payments but also a portion of the expense of company.
provided health care. Employee Retention Credit S Corporation
Employers can be immediately repaid for the credit by reducing the amount of payroll taxes they.