Lets talk first about How Do I Apply For The Employee Retention Credit :
Our group here what do these men doing everyone in this room is assisting teach individuals about ERC and uh constantly supply a stunning breakfast and have people really discover the program we must head to the space where we have the ability 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 actually 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 imply 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 mean it’s simply I indicate think about how many real clients 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 validated 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 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 method they deposit it into their savings account and they can really rely on Wonder trust that the process has actually been completed and how many you believe you’ve processed because you started 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 truly crucial today the staff member retention credit which most of you have never ever become aware of I certainly had not become aware of it until extremely just recently and learned a lot about it due to the fact that this is most likely the lowest expense of capital for any small company anywhere
anytime if you have employees between 5 and five hundred so I have actually got the professional with me this is Josh Fox he’s the founder and CEO of bottom line Concepts 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 simply contact your bank manager and state offer 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 enjoy this program it’s going away soon you got to discover everything about it let’s talk worker retention credit Josh Fox what is an ERC let’s just start there so during the Trump Administration when President Trump was enacted they created the cares Act and the cares act used businesses 3 chances 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 two of them are loans and one’s a refund precisely so the ERC is a refund that’s.
correct the cash money payroll tax refund fine go on sorry I just have to ensure we got that point I indicate that’s a big difference a loan versus money cash I like cash money that’s what we’re speaking 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 hard check in the mail where you get actual money 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 had to be a worker so I’m going to make the Assumption this cash is not for the owner not for people on the cap table not for shareholders it’s for staff members right you had to have owned a service but 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 have to be on payroll in 2020 on the W-2 and you need 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 stroll 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. fine so that’s how it’s determined you have to be on the W-2 throughout that duration now let’s talk my favorite part money how much can you get back per staff member 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 income 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 employee’s wage to an optimum of seven thousand per quarter how did that occur um they just changed the rules in.
2021 versus due to the fact that the mayhem of the pandemic so they wished to even get more to keep those staff members on payroll 100 so if you can get 5 000 per person Max in twenty that was 50 in 2020 as much as 5 thousand Max and after that what happens 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 worker that is since that’s a lot of cash it is now there’s a caveat here the PPP cash 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 someplace around ten thousand dollars an individual so let’s state hypothetically you owned a dining establishment in New York City where I’m from and you had a hundred workers and you took PPP cash you would still get a million dollar in the mail from the IRS so it’s huge clearly now the huge question is why does no one understand about this because look when I initially heard about this when I first met Josh you know I’ve got lots of investments in lots of companies I’m a major advocate for entrepreneurship in America and make many lots of investments in entrepreneurs of which numerous suffered through the pandemic when I initially became aware of this I called BS I do not think it due to the fact that I use 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 said nah it can’t be true however when I dug around I even called to my political leader buddies Governor 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 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 no one know about the staff member retention credit you understand what’s fascinating you’re talking about the banks Kevin because in the PPP loan process the federal government made it really 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 process in Canada a pre-pp loan there’s no loans in Canada by the way it’s just process procedure that’s all um and here there was chaos due to the fact that remember in the initial cares act you could refrain from doing both programs so if you had actually done PPP you might not do ERC in the initial program and when they altered the law in 2021 the banks were refraining from doing ERC due to the fact that it’s not alone so you’re getting a tax refund so the federal government never ever made it clear to anybody about how to.
do this does your CFO know how to do this not truly he or she’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 accountant no your accountant’s never ever done this prior to unless you have an account that entered into this business and bottom line my company Kevin has been in business considering that 2009 and we have actually been working with the federal government and the state federal government to recuperate cash for Fortune 500 Fortune 1000 companies so a lot of our huge huge corporate clients have actually worked with bottom line to recover other federal government programs we’ve done sales tax and use tax unemployment tax work opportunity tax credits research and development tax credits unclaimed home real estate tax all of these other government programs.
The employee retention tax credit is a broad based refundable tax credit created to motivate.
employers to keep employees on their payroll. The credit is 50% of up to $10,000 in earnings paid by an.
Because of COVID-19 or whose gross receipts, company whose company is completely or partially suspended.
decline by more than 50%.
1. The credit is offered to all employers regardless of size including tax exempt companies. There are.
only 2 exceptions: (1) state and city governments and their instrumentalities and (2) little.
companies who take Small company Loans.
2. To certify, the employer has to satisfy one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the employer’s business is fully or partly suspended by federal government order due to COVID-19.
during the calendar quarter or.
o the company’s gross invoices are listed below 50% of the similar quarter in 2019. When the.
company’s gross receipts exceed 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 incomes paid up to $10,000 in total.
It works for salaries paid after March 13th and before December 31, 2020.
The meaning of certifying earnings varies by whether an employer had, on average, more or less than.
100 employees in 2019.
Companies that specialize in ERC filing support generally provide expertise and support to assist companies navigate the complicated process of claiming the credit. They can use various services, including:.
How is the employee retention credit calculated? How Do I Apply For The Employee Retention Credit
Eligibility Assessment: These business will evaluate your company’s eligibility for the ERC based on factors such as your market, profits, and operations. They can assist identify if you meet the requirements for the credit and recognize the optimum credit quantity you can declare.
Documentation and Estimation: ERC filing services will assist in collecting the required documentation, such as payroll records and financial declarations, to support your claim. They will likewise help compute the credit quantity based on qualified earnings and other certifying expenditures.
Retroactive Claim Review: If you are qualified to claim the ERC for previous quarters, these business can review your past payroll records and financials to determine potential opportunities for retroactive credits. They can assist you change prior tax returns to declare these refunds.
Filing Support: Companies concentrating on ERC filings will prepare and submit the essential forms and documentation in your place. This includes finishing Type 941 or any other required tax return.
Compliance and Updates: ERC policies and guidance have developed over time. These companies remain upgraded with the most recent modifications and ensure that your filings abide by the most current guidelines. They can also offer ongoing assistance if the IRS demands additional information or conducts an audit related to your ERC claim.
It is necessary to research and veterinarian any company offering ERC filing assistance to guarantee their credibility and competence. Try to find recognized firms with experience in tax and payroll services, or consider connecting to relied on accounting firms or tax professionals who offer ERC submitting assistance.
Remember that while these companies can offer important support, it’s always 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 Worker Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief steps. The goal of the ERC is to motivate organizations to keep and pay their employees throughout the pandemic, even if their operations have been impacted.
Here are some key points about the ERC:.
Eligibility: The ERC is offered to qualified employers, consisting of for-profit businesses, tax-exempt organizations, and specific governmental entities. To certify, companies should 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 significant decline in gross receipts. As mentioned previously, for 2021, a considerable decline is defined as a 20% decrease in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a substantial decline is specified as a 20% decrease in gross invoices compared to the exact same quarter in 2019, or a 20% decrease in gross invoices 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 amount amounts to a percentage (approximately 70%) of certified salaries paid to staff members, including particular health plan expenditures. The maximum credit per worker is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, businesses that received a Paycheck Security Program (PPP) loan were not eligible for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 allows organizations to claim the ERC even if they received a PPP loan. The very same incomes can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively broadened and boosted, enabling eligible employers to claim the credit for qualified wages paid as far back as March 13, 2020. This retroactive arrangement provides a chance for companies to change prior-year tax returns and get refunds.
Claiming the Credit: Companies can claim the ERC by reporting it on their employment tax returns, usually Kind 941. The excess can be reimbursed to the employer if the credit surpasses the amount of employment taxes owed.
It’s important to note that the ERC arrangements and eligibility requirements have actually developed over time. The best strategy is to talk to a tax expert or visit the official IRS website for the most current and comprehensive info concerning the ERC, consisting of any current legal changes or updates.
To receive the ERC, a service should fulfill one of the following requirements:.
Business operations were fully or partly suspended due to a government order related to COVID-19.
Business experienced a significant decline in gross invoices. 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 substantial decrease is specified as a 20% decrease in gross invoices compared to the same quarter in 2019, or a 20% decrease in gross invoices compared to the instantly preceding quarter.
The ERC is available to companies of all sizes, including tax-exempt companies, but there are some exceptions. Government entities and businesses that received a PPP loan might have limitations on declaring the credit.
The procedure for claiming the ERC includes completing the needed kinds and including the credit on your work tax return (typically Type 941). The exact time it requires to process the credit can differ based upon a number of factors, consisting of the intricacy of your business and the work of the IRS. It’s recommended to consult with a tax expert for guidance specific to your circumstance.
There are a number of companies that can assist with the procedure of claiming the ERC. Some widely known companies that offer help with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the information offered here is based upon general understanding and might not show the most current updates or modifications to the ERC. It is essential to speak with a tax expert or check out the official internal revenue service website for the most updated and accurate information regarding eligibility, declaring treatments, and readily available support.
Less than 100. The credit is based if the company had 100 or less staff members on average in 2019.
on earnings paid to all employees whether they actually worked or not. In other words, even if the.
workers worked full time and made money for full time work, the employer still gets the credit.
Greater than 100. The credit is if the company had more than 100 employees on average in 2019.
enabled just for salaries paid to staff members who did not work during the calendar quarter.
In both cases, “wages” includes not just money payments however also a part of the expense of company.
supplied healthcare. How Do I Apply For The Employee Retention Credit
Employers can be right away repaid for the credit by lowering the amount of payroll taxes they.