Lets talk first about Is The Employee Retention Credit Only For Full Time Employees :
Our group here what do these people doing everyone in this space is helping teach individuals about ERC and uh constantly offer a gorgeous breakfast and have people really learn more about the program we should head to the room where we are able to show some of the checks that we are getting for companies and I ‘d like to see that what is this this is uh numerous countless dollars literally Kevin numerous countless dollars so these are replicate copies of the letters that go to clients confirming that the check is on the method I mean you know if you just begin to take a look at some of these here I indicate this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I imply it’s just I indicate think of the number of 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 client so that’s how you have the ability to track it you understand when you
receive this you understand the check is gone for sure which’s when they pay so they don’t pay anything up until they actually get the cash they do not pay bottom line Wonder trust anything till this letter is confirmed the check is on the method they transfer it into their checking account and they can truly trust Wonder trust that the process has been finished and the number of you think you’ve processed because you began this we’re about 35 000 of these for
about 6 billion dollars wow so plainly they understand what they’re doing and that’s what you require you require professionals 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 truly important today the employee retention credit which most of you have never ever heard of I certainly hadn’t heard of it up until really recently and found out a lot about it due to the fact that this is most likely the lowest cost of capital for any small business anywhere
anytime if you have staff members in between five and five hundred so I’ve got the expert 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 difficult this isn’t like PPP we simply contact 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 inform us all about it and how to get it and why I have actually become yes the Ambassador and paid representative for this I like this program it’s disappearing soon you got to find out all about it let’s talk worker 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 organizations 3 opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and almost everybody it makes a huge difference right there two of them are loans and one’s a refund precisely so the ERC is a refund that’s.
fix the money cash payroll tax refund okay go on sorry I simply have to make sure we got that point I imply that’s a huge difference a loan versus cash money I like money cash that’s what we’re speaking about 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 lovely difficult check in the mail where you get actual cash from the IRS all right so let’s discuss how it works since 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 Presumption this money is not for the owner not for individuals on the cap table not for investors it’s for staff members right you had to have owned an organization however it’s based upon you having W-2 employees 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 six months of 2021 on the W-2 proper so there were six quarters the program was open well stroll us through the 6 quarters so you had quarters 2 three and 4 of 2020 and you had quarters one two and three of 2021. fine so that’s how it’s determined you have to be on the W-2 during that duration now let’s talk my preferred part cash just how much can you return per staff member that was on a W-2 in those six quarters so the computation in 2020 to be specific Kevin is 50 of the employee’s income to a maximum of five thousand dollars per worker for the year of 2020 and in 2021 the numbers escalated to 70 of the worker’s salary to an optimum of 7 thousand per quarter how did that occur um they just changed 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 staff members on payroll 100 so if you can get 5 000 per person Max in twenty that was 50 in 2020 approximately 5 thousand Max and after that what takes place 21 000 Max in 2021 oh that’s how you create twenty six 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 since that’s a lot of money it is now there’s a caution here the PPP money would need to be minimized from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan 2 you would minimize the 26 000 so what we’re seeing on average Kevin is if you took PPP money somewhere around 10 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 money you would still get a million dollar in the mail from the IRS so it’s big clearly now the big concern is why does nobody understand about this because look when I initially found out about this when I initially fulfilled Josh you know I’ve got great deals of investments in lots of companies I’m a significant supporter for entrepreneurship in America and make lots of many financial investments in entrepreneurs of which numerous suffered through the pandemic when I first became aware of this I called BS I do not think it since I utilize 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 which were well been worthy of and we used them wisely to survive 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 buddies Governor Senators they didn’t know about it I imply that’s how you understand that’s how misinformation is that there’s no info out there then a lot 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 no one know about the staff member retention credit you understand what’s fascinating you’re discussing the banks Kevin because in the PPP loan process the federal government made it extremely 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 procedure process that’s all um and here there was chaos 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 refrain from doing ERC in the initial program and when they changed the law in 2021 the banks were not doing ERC due to the fact that 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 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 accounting professional’s never done this before unless you have an account that went into this company and bottom line my firm Kevin has stayed in business considering that 2009 and we have actually been working with the federal government and the state government to recover money for Fortune 500 Fortune 1000 companies so a great deal of our huge huge business customers have actually worked with bottom line to recuperate other federal government programs we have actually 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 government programs.
The employee retention tax credit is a broad based refundable tax credit designed to encourage.
companies to keep staff members on their payroll. The credit is 50% of up to $10,000 in incomes paid by an.
employer whose business is totally or partially suspended because of COVID-19 or whose gross receipts.
decline by more than 50%.
1. The credit is readily available to all companies despite size consisting of tax exempt companies. There are.
just two exceptions: (1) state and city governments and their instrumentalities and (2) little.
businesses who take Small company Loans.
2. To qualify, the employer has to fulfill one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the employer’s business is totally or partly suspended by government order due to COVID-19.
during the calendar quarter or.
o the company’s gross receipts are listed below 50% of the similar quarter in 2019. When the.
employer’s gross invoices exceed 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 salaries paid after March 13th and before December 31, 2020.
The meaning of qualifying incomes differs by whether a company had, on average, basically than.
100 staff members in 2019.
Business that focus on ERC filing help typically provide know-how and support to assist services navigate the complicated procedure of declaring the credit. They can use numerous services, consisting of:.
How is the employee retention credit calculated? Is The Employee Retention Credit Only For Full Time Employees
Eligibility Evaluation: These business will evaluate your service’s eligibility for the ERC based on aspects such as your market, earnings, and operations. If you satisfy the requirements for the credit and determine the optimum credit quantity you can claim, they can assist determine.
Documentation and Computation: ERC filing services will assist in collecting the required paperwork, such as payroll records and monetary declarations, to support your claim. They will also assist compute the credit quantity based upon qualified wages and other certifying expenditures.
Retroactive Claim Evaluation: If you are eligible to claim the ERC for prior quarters, these companies can evaluate your previous payroll records and financials to identify potential chances for retroactive credits. They can help you amend prior tax returns to declare these refunds.
Filing Help: Companies focusing on ERC filings will prepare and send the necessary forms and documentation on your behalf. This consists of completing Type 941 or any other necessary tax return.
Compliance and Updates: ERC regulations and assistance have actually developed in time. These business remain upgraded with the current modifications and make sure that your filings adhere to the most existing standards. If the Internal revenue service requests extra details or conducts an audit related to your ERC claim, they can also offer continuous support.
It’s important to research study and vet any company providing ERC filing assistance to guarantee their trustworthiness and knowledge. Look for established firms with experience in tax and payroll services, or consider reaching out to trusted accounting firms or tax specialists who offer ERC submitting assistance.
Bear in mind that while these companies can provide valuable help, it’s constantly a good idea to have a standard understanding of the ERC requirements and procedure yourself. This will assist you make informed decisions and make sure precise filings.
The Employee Retention Credit (ERC) is a refundable tax credit introduced by the U.S. federal government as part of COVID-19 relief measures. The objective of the ERC is to motivate services to keep and pay their employees throughout the pandemic, even if their operations have been affected.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is readily available to qualified employers, including for-profit organizations, tax-exempt organizations, and particular governmental entities. To certify, employers need to satisfy one of two requirements:.
The business operations were fully or partly suspended due to a federal government order related to COVID-19.
The business experienced a considerable decline in gross receipts. As discussed earlier, for 2021, a significant decline is defined as a 20% decrease in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a considerable decrease is specified as a 20% decline in gross invoices compared to the same quarter in 2019, or a 20% decrease in gross invoices compared to the instantly preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit amount amounts to a percentage (approximately 70%) of certified earnings paid to staff members, including particular health insurance expenses. The optimum credit per employee is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: At first, companies that received an Income Security Program (PPP) loan were not eligible for the ERC. However, legislation passed in late 2020 and extended in 2021 allows services to declare the ERC even if they got a PPP loan. The very same incomes can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively broadened and enhanced, permitting qualified companies to declare the credit for certified wages paid as far back as March 13, 2020. This retroactive arrangement provides an opportunity for companies to change prior-year income tax return and get refunds.
Declaring the Credit: Employers can declare the ERC by reporting it on their employment income tax return, usually Kind 941. The excess can be refunded to the company if the credit surpasses the quantity of work taxes owed.
It is essential to note that the ERC arrangements and eligibility criteria have actually evolved in time. The very best course of action is to consult with a tax professional or check out the main IRS site for the most up-to-date and comprehensive info relating to the ERC, including any current legislative modifications or updates.
To qualify for the ERC, an organization must fulfill one of the following criteria:.
The business operations were fully or partly suspended due to a government order related to COVID-19.
Business experienced a substantial decrease in gross receipts. For 2021, a significant decline is defined as a 20% decline in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a substantial decline is defined as a 20% decrease in gross receipts compared to the very same quarter in 2019, or a 20% decrease in gross invoices compared to the instantly preceding quarter.
The ERC is readily available to organizations of all sizes, including tax-exempt organizations, but there are some exceptions. Federal government entities and companies that received a PPP loan might have constraints on claiming the credit.
The process for claiming the ERC involves finishing the needed forms and including the credit on your employment tax return (usually Kind 941). The exact time it takes to process the credit can vary based upon several aspects, including the complexity of your service and the work of the IRS. It’s advised to seek advice from a tax expert for guidance specific to your circumstance.
There are a number of companies that can help with the procedure of declaring the ERC. Some widely known companies that offer assistance with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the information provided here is based upon basic knowledge and may not show the most recent updates or modifications to the ERC. It is necessary to consult with a tax expert or visit the official IRS site for the most accurate and up-to-date details relating to eligibility, claiming treatments, and available assistance.
Less than 100. If the company had 100 or fewer staff members typically in 2019, then the credit is based.
on earnings paid to all employees whether they really worked or not. Simply put, even if the.
employees worked full-time and earned money for full-time work, the company still gets the credit.
Greater than 100. If the employer had more than 100 staff members usually in 2019, then the credit is.
allowed only for salaries paid to staff members who did not work during the calendar quarter.
In both cases, “wages” includes not just money payments however likewise a portion of the expense of employer.
offered health care. Is The Employee Retention Credit Only For Full Time Employees
Companies can be right away reimbursed for the credit by minimizing the quantity of payroll taxes they.