Lets talk first about Employee Retention Credit September 30 :
Our team here what do these people doing everyone in this space is assisting teach individuals about ERC and uh constantly provide a lovely breakfast and have people truly learn more about the program we need 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 numerous countless dollars actually Kevin hundreds of countless dollars so these are replicate copies of the letters that go to customers verifying that the check is on the way I mean you know if you just begin to take a look at a few of these here I indicate this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I indicate it’s just I indicate think about 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 internal revenue service heading to the client so that’s how you’re able to track it you know when you
get this you understand the check is gone for sure and that’s when they pay so they don’t pay anything until they really get the money they don’t pay bottom line Wonder trust anything till this letter is verified the check is on the way they transfer it into their checking account and they can genuinely trust Wonder trust that the process has been ended up and how many you believe you’ve processed since you began this we’re about 35 000 of these for
about six billion dollars wow so clearly they understand 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 one of these that’s what matters all right Mr Wonderful here you’re at my YouTube channel we’re talking about something really crucial today the employee retention credit which most of you have actually never ever heard of I definitely hadn’t become aware of it until really recently and learned a lot about it since this is probably the lowest cost of capital for any small company anywhere
anytime if you have workers in between 5 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 biggest processor of these ERC credits this is a 170 page program so it’s not easy this isn’t like PPP we simply call your bank manager and state offer 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 ended up being 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 worker retention credit Josh Fox what is an ERC let’s just begin there so during the Trump Administration when President Trump was enacted they developed the cares Act and the cares act provided services 3 chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically everyone 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.
correct the money money payroll tax refund okay go on sorry I simply have to ensure we got that point I imply that’s a big difference a loan versus money money I like cash money that’s what we’re talking about okay 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 hard check in the mail where you get real money from the internal revenue service all right so let’s talk about how it works because it sounds like to me if it’s a if it’s employee retention credit that individual had to be a staff member so I’m going to make the Assumption this cash is not for the owner not for individuals on the cap table not for shareholders it’s for employees right you needed to have actually owned a service however it’s based on you having W-2 workers in America not 10.99. so as long as you had W-2 staff members 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 have to be on payroll for the very first 6 months of 2021 on the W-2 appropriate so there were 6 quarters the program was open well walk us through the six quarters so you had quarters two 3 and four of 2020 and you had quarters one 2 and three of 2021. fine so that’s how it’s measured you have to be on the W-2 during that period now let’s talk my favorite part cash 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 staff member’s income to a maximum of 5 thousand dollars per employee for the year of 2020 and in 2021 the numbers escalated to 70 of the staff member’s wage to an optimum of seven thousand per quarter how did that occur um they simply changed the rules in.
2021 versus since the chaos 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 then what takes place 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 6 thousand dollars per worker that is because that’s a great deal of money it is now there’s a caution here the PPP money would need to be decreased from the twenty six thousand dollars so if you took PPP loan one and PPP loan 2 you would decrease the 26 000 so what we’re seeing usually Kevin is if you took PPP money somewhere around ten thousand dollars an individual 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 cash you would still get a million dollar in the mail from the IRS so it’s substantial undoubtedly now the big question is why does no one understand about this since appearance when I first became aware of this when I initially met Josh you know I’ve got lots of investments in lots of business I’m a major advocate for entrepreneurship in America and make numerous lots of investments in entrepreneurs of which many suffered through the pandemic when I first heard about this I called BS I do not believe 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 and that were well should have and we utilized them carefully to stay alive during the pandemic so when I found out about this I stated nah it can’t be true however when I dug around I even called to my politician good friends Governor Senators they didn’t learn about it I mean that’s how you know that’s how false information is that there’s no details 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 know about the employee retention credit you understand what’s fascinating you’re talking about the banks Kevin due to the fact that in the PPP loan process the federal government made it very clear that if you desired 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 simply 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 not do both programs so if you had done PPP you might not do ERC in the initial program and when they changed 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 know how to do this not actually she or he’s never done it previously do the banks do it nope the banks do not do it the payroll business yeah a few 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 business and bottom line my firm Kevin has actually been in business given that 2009 and we’ve been dealing with the federal government and the state government to recuperate money for Fortune 500 Fortune 1000 companies so a great deal of our huge big corporate clients have worked with bottom line to recover other government programs we have actually done sales tax and use tax unemployment 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 designed to motivate.
employers to keep employees on their payroll. The credit is 50% of up to $10,000 in incomes paid by an.
Since of COVID-19 or whose gross invoices, employer whose business is fully or partly suspended.
decline by more than 50%.
1. The credit is available to all companies no matter size including tax exempt companies. There are.
just two exceptions: (1) state and city governments and their instrumentalities and (2) small.
organizations who take Small Business Loans.
2. To certify, the company needs to satisfy one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the employer’s organization is completely or partly suspended by federal government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross invoices are listed below 50% of the comparable quarter in 2019. As soon as the.
employer’s gross invoices go above 80% of a similar quarter in 2019 they no longer qualify.
after completion of that quarter.
Computation of the Credit.
The amount of the credit is 50% of the qualifying wages paid up to $10,000 in overall.
It works for earnings paid after March 13th and before December 31, 2020.
The definition of certifying earnings varies by whether a company had, typically, more or less than.
100 staff members in 2019.
Business that specialize in ERC filing assistance generally offer knowledge and support to help businesses browse the complex procedure of claiming the credit. They can use various services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit September 30
Eligibility Assessment: These companies will examine your company’s eligibility for the ERC based on elements such as your industry, profits, and operations. If you fulfill the requirements for the credit and determine the maximum credit amount you can claim, they can help figure out.
Documentation and Calculation: ERC filing services will assist in collecting the necessary paperwork, such as payroll records and financial declarations, to support your claim. They will likewise assist determine the credit quantity based on eligible earnings and other certifying expenses.
Retroactive Claim Review: If you are eligible to declare the ERC for prior quarters, these companies can evaluate your previous payroll records and financials to identify prospective opportunities for retroactive credits. They can assist you modify prior income tax return to declare these refunds.
Filing Assistance: Business concentrating on ERC filings will prepare and submit the needed types and paperwork in your place. This includes completing Type 941 or any other required tax forms.
Compliance and Updates: ERC policies and guidance have developed with time. These companies remain updated with the most recent changes and guarantee that your filings adhere to the most current standards. If the IRS demands additional info or performs an audit related to your ERC claim, they can likewise provide ongoing assistance.
It is essential to research and vet any business offering ERC filing help to guarantee their reliability and know-how. Look for established firms with experience in tax and payroll services, or think about reaching out to relied on accounting firms or tax specialists who use ERC submitting support.
Bear in mind that while these business can provide valuable support, it’s constantly a great concept to have a standard understanding of the ERC requirements and procedure yourself. This will help you make informed choices and make sure accurate filings.
The Employee Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief steps. The objective of the ERC is to encourage businesses to keep and pay their employees throughout the pandemic, even if their operations have been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is readily available to qualified companies, including for-profit organizations, tax-exempt organizations, and specific governmental entities. To certify, companies need to satisfy one of two 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. As discussed previously, for 2021, a substantial decrease is specified as a 20% decrease in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a significant decrease is specified as a 20% decrease in gross invoices compared to the exact same quarter in 2019, or a 20% decline in gross receipts 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 portion (as much as 70%) of qualified incomes paid to workers, including certain health insurance expenses. 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, companies that received an Income Protection 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. The very same salaries can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively expanded and enhanced, allowing qualified companies to declare the credit for certified earnings paid as far back as March 13, 2020. This retroactive provision provides an opportunity for businesses to amend prior-year income tax return and receive refunds.
Claiming the Credit: Companies can claim the ERC by reporting it on their work income tax return, usually Kind 941. The excess can be refunded 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 evolved over time. The very best strategy is to consult with a tax professional or visit the main internal revenue service website for the most in-depth and current details concerning the ERC, consisting of any recent legislative changes or updates.
To receive the ERC, a service must fulfill among the following 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. For 2021, a considerable decline is defined as a 20% decrease in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a considerable decline is defined as a 20% decrease in gross invoices compared to the very same quarter in 2019, or a 20% decline in gross receipts compared to the instantly preceding quarter.
The ERC is readily available to businesses of all sizes, including tax-exempt companies, but there are some exceptions. Federal government entities and businesses that got a PPP loan might have limitations on declaring the credit.
The procedure for claiming the ERC includes finishing the required types and consisting of the credit on your employment income tax return (normally Kind 941). The exact time it takes to process the credit can vary based on numerous factors, consisting of the intricacy of your service and the workload of the IRS. It’s advised to consult with a tax professional for assistance particular to your scenario.
There are a number of business that can assist with the process of claiming the ERC. Some widely known business that provide help with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the info supplied here is based on general knowledge and might not show the most current updates or modifications to the ERC. It is necessary to speak with a tax expert or check out the main IRS website for the most updated and precise details regarding eligibility, claiming treatments, and offered 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 really worked or not. In other words, even if the.
employees worked full time and got paid 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.
permitted just for incomes paid to staff members who did not work during the calendar quarter.
In both cases, “wages” includes not just cash payments however likewise a part of the cost of company.
supplied health care. Employee Retention Credit September 30
Employers can be immediately compensated for the credit by reducing the quantity of payroll taxes they.