Lets talk first about Employee Retention Credit Vs Ppp Loan :
Our team here what do these people doing everyone in this room is helping teach people about ERC and uh constantly provide a beautiful breakfast and have individuals truly find out about the program we ought to head to the space where we are able to display a few of the checks that we are getting for companies and I want to see that what is this this is uh numerous millions of dollars literally Kevin numerous millions of dollars so these are replicate copies of the letters that go to customers confirming that the check is on the method I mean you understand if you simply 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 mean it’s just I suggest think about how many actual customers 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 confirmed and the check is on the mail in the mail from the IRS heading to the customer 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 until they actually receive the money they do not pay bottom line Wonder trust anything till this letter is verified the check is on the way they transfer it into their savings account and they can really trust Wonder trust that the process has actually been ended up and the number of you believe you’ve processed since you started this we’re about 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 require specialists 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 Wonderful here you’re at my YouTube channel we’re talking about something really essential today the worker retention credit which most of you have actually never become aware of I definitely had not become aware of it up until very recently and discovered a lot about it due to the fact that this is probably the lowest cost of capital for any small company anywhere
anytime if you have employees between five and five hundred so I’ve got the professional with me this is Josh Fox he’s the creator and CEO of bottom line Ideas they’re the biggest processor of these ERC credits this is a 170 page program so it’s challenging this isn’t like PPP we just call up 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 tell all of us about it and how to get it and why I’ve ended up being yes the Ambassador and paid representative for this I love this program it’s disappearing very soon you got to learn everything about it let’s talk employee 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 provided companies 3 chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and almost everyone it makes a huge distinction right there two of them are loans and one’s a refund exactly so the ERC is a refund that’s.
correct the cash cash payroll tax refund alright go on sorry I just need to make certain we got that point I mean that’s a big difference a loan versus money money I like money money that’s what we’re discussing alright 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 gorgeous tough check in the mail where you get actual cash from the internal revenue service all right so let’s talk about how it works due to the fact that it sounds like to me if it’s a if it’s staff member retention credit that person needed to be an employee so I’m going to make the Presumption this money is not for the owner not for people on the cap table not for shareholders it’s for workers right you needed to have actually 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 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 first 6 months of 2021 on the W-2 correct 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 two and 3 of 2021. okay 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 get back per worker that was on a W-2 in those six quarters so the computation in 2020 to be precise Kevin is 50 of the employee’s salary to an optimum of five thousand dollars per staff member for the year of 2020 and in 2021 the numbers increased to 70 of the staff member’s salary to an optimum of 7 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 approximately five 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 6 thousand dollars per staff member that is since that’s a great deal of money it is now there’s a caveat here the PPP cash would have 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 typically Kevin is if you took PPP money somewhere 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 internal revenue service so it’s huge obviously now the big concern is why does no one learn about this since appearance when I first found out about this when I initially met Josh you understand I’ve got lots of financial investments in lots of companies I’m a major supporter for entrepreneurship in America and make many numerous investments in business owners of which numerous suffered through the pandemic when I initially became aware of this I called BS I don’t think it due to the fact that I use the PPP we went through the cash center Banks to get it it was extremely easy to do we had our CEOs call the banks they got their loans and that were well been worthy of and we utilized them sensibly to stay alive during the pandemic so when I became aware of this I stated nah it can’t hold true however when I dug around I even called to my political leader pals Governor Senators they didn’t learn about it I suggest that’s how you know that’s how false information is that there’s no information out there then a bunch of people informed me well you can’t get it since you took the PPP likewise not real so let’s ask Josh why does nobody understand about the staff member retention credit you understand what’s intriguing you’re talking 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 nation 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 chaos because remember in the original cares act you could not do both programs so if you had done PPP you could not do ERC in the original 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 anybody 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 don’t do it the payroll business yeah a few of them are doing it as a payroll company your accountant no your accountant’s never done this before unless you have an account that went into this service and bottom line my company Kevin has been in business because 2009 and we’ve been working with the federal government and the state federal government to recuperate money for Fortune 500 Fortune 1000 companies so a lot of our big huge business clients have actually worked with bottom line to recuperate other government programs we’ve done sales tax and utilize tax unemployment tax work opportunity tax credits research and development tax credits unclaimed home real estate 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.
Since of COVID-19 or whose gross receipts, company whose organization is completely or partially suspended.
decrease by more than 50%.
1. The credit is available to all companies despite size including tax exempt companies. There are.
just 2 exceptions: (1) state and local governments and their instrumentalities and (2) little.
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 company is completely or partially suspended by federal 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 exceed 80% of a comparable quarter in 2019 they no longer certify.
after completion of that quarter.
Estimation of the Credit.
The amount of the credit is 50% of the certifying incomes paid up to $10,000 in total.
It is effective for incomes paid after March 13th and prior to December 31, 2020.
The meaning of qualifying earnings differs by whether a company had, usually, more or less than.
100 staff members in 2019.
Companies that specialize in ERC filing support usually provide competence and assistance to help organizations browse the intricate process of declaring the credit. They can offer different services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit Vs Ppp Loan
Eligibility Evaluation: These business will evaluate your organization’s eligibility for the ERC based upon factors such as your market, income, and operations. They can assist determine if you fulfill the requirements for the credit and recognize the maximum credit amount you can declare.
Documents and Calculation: ERC filing services will assist in gathering the essential documents, such as payroll records and financial declarations, to support your claim. They will also assist determine the credit amount based on eligible wages and other qualifying expenditures.
Retroactive Claim Review: If you are eligible to declare the ERC for prior quarters, these companies can review your previous payroll records and financials to determine prospective chances for retroactive credits. They can help you amend previous tax returns to claim these refunds.
Filing Support: Business concentrating on ERC filings will prepare and send the needed kinds and documents on your behalf. This includes finishing Form 941 or any other required tax forms.
Compliance and Updates: ERC policies and guidance have actually evolved in time. These business remain updated with the latest changes and make sure that your filings abide by the most existing guidelines. They can also provide ongoing assistance if the internal revenue service demands extra details or carries out an audit related to your ERC claim.
It’s important to research and vet any company providing ERC filing assistance to ensure their trustworthiness and know-how. Look for established firms with experience in tax and payroll services, or think about reaching out to trusted accounting companies or tax specialists who offer ERC filing support.
Keep in mind that while these business can provide valuable help, it’s always a great idea to have a standard understanding of the ERC requirements and process yourself. This will assist you make notified decisions and make sure accurate filings.
The Employee Retention Credit (ERC) is a refundable tax credit presented by the U.S. government as part of COVID-19 relief steps. The goal of the ERC is to encourage organizations to retain and pay their staff members 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 employers, consisting of for-profit businesses, tax-exempt organizations, and specific governmental entities. To certify, companies should meet one of two criteria:.
The business operations were completely or partly suspended due to a government order related to COVID-19.
Business experienced a significant decrease in gross receipts. As pointed out earlier, for 2021, a significant decrease is defined as a 20% decline in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a considerable decline is specified as a 20% decrease in gross receipts compared to the same quarter in 2019, or a 20% decline in gross invoices compared to the right away preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit quantity amounts to a percentage (approximately 70%) of qualified earnings paid to employees, 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 a Paycheck Protection Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 enables organizations to declare the ERC even if they got a PPP loan. Nevertheless, the same earnings can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively broadened and improved, permitting eligible companies to claim the credit for certified incomes paid as far back as March 13, 2020. This retroactive provision offers an opportunity for services to amend prior-year income tax return and get refunds.
Declaring the Credit: Employers can claim the ERC by reporting it on their work income tax return, usually Form 941. If the credit exceeds the quantity of work taxes owed, the excess can be reimbursed to the employer.
It is essential to note that the ERC provisions and eligibility requirements have progressed gradually. The best course of action is to consult with a tax expert or check out the official internal revenue service website for the most detailed and updated details concerning the ERC, including any current legal changes or updates.
To qualify for the ERC, a company should meet among the following criteria:.
The business operations were fully or partly suspended due to a government order related to COVID-19.
The business experienced a substantial decline in gross receipts. For 2021, a considerable decrease is specified as a 20% decline in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a substantial decline is specified as a 20% decrease in gross invoices compared to the very same quarter in 2019, or a 20% decline in gross invoices compared to the immediately preceding quarter.
The ERC is readily available to businesses of all sizes, including tax-exempt organizations, however there are some exceptions. Federal government entities and organizations that received a PPP loan might have restrictions on claiming the credit.
The procedure for declaring the ERC includes completing the necessary types and including the credit on your employment income tax return (typically Kind 941). The exact time it takes to process the credit can vary based upon numerous elements, consisting of the complexity of your service and the work of the IRS. It’s recommended to consult with a tax expert for assistance particular to your scenario.
There are a number of business that can aid with the process of declaring the ERC. These include accounting companies, tax advisory services, and payroll provider. Some popular companies that use help with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s a good idea to research and call these companies straight to inquire about their services and charges.
Please keep in mind that the info offered here is based upon basic knowledge and might not reflect the most current updates or changes to the ERC. It is essential to talk to a tax expert or go to the official internal revenue service website for the most precise and current info concerning eligibility, claiming treatments, and readily available support.
Less than 100. The credit is based if the company had 100 or fewer staff members on average in 2019.
on incomes paid to all employees whether they really worked or not. To put it simply, 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.
enabled only for salaries paid to staff members who did not work throughout the calendar quarter.
In both cases, “salaries” includes not just money payments however also a part of the expense of employer.
provided health care. Employee Retention Credit Vs Ppp Loan
Employers can be instantly repaid for the credit by lowering the amount of payroll taxes they.