Lets talk first about Is There An Employee Retention Credit :
Our team here what do these men doing everyone in this room is assisting teach individuals about ERC and uh constantly provide a lovely breakfast and have people truly learn more about the program we must head to the space where we are able to display a few of the checks that we are getting for business and I ‘d like to see that what is this this is uh numerous millions of dollars actually Kevin numerous millions of dollars so these are replicate copies of the letters that go to customers validating that the check is on the method I indicate you know if you just start to take a look at some of these here I mean this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I suggest it’s simply I indicate think about how many actual clients 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 validated 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 know the check is chosen sure and that’s when they pay so they don’t pay anything up until they in fact receive the money they don’t pay bottom line Wonder trust anything up until this letter is verified the check is on the way they deposit it into their checking account and they can genuinely rely on Wonder trust that the procedure has actually been completed and the number of you believe you’ve processed given that you started this we’re about 35 000 of these for
about 6 billion dollars wow so plainly they know what they’re doing and that’s what you require you need 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 Terrific here you’re at my YouTube channel we’re speaking about something really crucial today the employee retention credit which most of you have actually never become aware of I certainly hadn’t heard of it until extremely recently and learned a lot about it since this is most likely the most affordable expense of capital for any small company anywhere
anytime if you have employees in between 5 and five hundred so I have actually got the specialist with me this is Josh Fox he’s the creator and CEO of bottom line Principles they’re the largest processor of these ERC credits this is a 170 page program so it’s challenging this isn’t like PPP we just contact 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 tell all of us about it and how to get it and why I have actually become yes the Ambassador and paid spokesperson for this I enjoy this program it’s going away very soon you got to discover everything about it let’s talk employee 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 offered services three 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.
remedy the cash money payroll tax refund fine go on sorry I just need to make sure we got that point I imply that’s a big difference a loan versus cash money 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 tough check in the mail where you get actual cash from the internal revenue service all right so let’s speak about how it works because it seems like to me if it’s a if it’s worker retention credit that person needed to be a worker so I’m going to make the Assumption this money is not for the owner not for people on the cap table not for shareholders it’s for workers right you had to have actually owned an organization however it’s based on you having W-2 employees in America not 10.99. so as long as you had W-2 employees 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 first six months of 2021 on the W-2 proper so there were six quarters the program was open well walk us through the 6 quarters so you had quarters 2 3 and 4 of 2020 and you had quarters one 2 and 3 of 2021. alright 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 get back per staff member that was on a W-2 in those 6 quarters so the estimation in 2020 to be precise Kevin is 50 of the worker’s income to a maximum of 5 thousand dollars per staff member for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the employee’s salary to a maximum of seven thousand per quarter how did that happen um they simply changed the rules in.
2021 versus since the turmoil of the pandemic so they wanted 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 up to 5 thousand Max and after that what occurs 21 000 Max in 2021 oh that’s how you develop 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 since 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 6 thousand dollars so if you took PPP loan one and PPP loan two 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 an individual so let’s say 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 undoubtedly now the big question is why does nobody learn about this because look when I first became aware of this when I first met Josh you know I have actually got lots of investments in lots of companies I’m a significant advocate for entrepreneurship in America and make lots of lots of financial investments in entrepreneurs of which lots of suffered through the pandemic when I initially became aware of this I called BS I do not believe it because 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 utilized them wisely to stay alive during the pandemic so when I found out about this I said nah it can’t be true but when I dug around I even called to my politician buddies Governor Senators they didn’t learn about it I indicate that’s how you know that’s how misinformation is that there’s no info out there then a lot of individuals told me well you can’t get it since you took the PPP also not true so let’s ask Josh why does nobody learn about the worker retention credit you know what’s interesting you’re talking about the banks Kevin since in the PPP loan process the federal government made it very clear that if you wanted a PPP loan you would call Wells Fargo Citibank Bank of America any of the big 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 might not do both programs so if you had actually done PPP you could 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 know how to do this not actually he or she’s never ever done it previously do the banks do it nope the banks don’t do it the payroll companies yeah a few of them are doing it as a payroll company your accountant no your accounting professional’s never ever done this prior to unless you have an account that went into this company and bottom line my company Kevin has been in business considering that 2009 and we’ve been dealing with the federal government and the state federal government to recuperate money for Fortune 500 Fortune 1000 business so a lot of our big huge business clients have dealt with bottom line to recover other federal government programs we’ve done sales tax and utilize tax unemployment 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 developed to encourage.
companies to keep workers on their payroll. The credit is 50% of as much as $10,000 in incomes paid by an.
employer whose organization is completely or partially suspended because of COVID-19 or whose gross receipts.
decline by more than 50%.
1. The credit is available to all companies despite size including tax exempt organizations. There are.
only two exceptions: (1) state and city governments and their instrumentalities and (2) small.
businesses who take Small company Loans.
2. To certify, the company has to fulfill one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the employer’s business is fully or partly suspended by government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross invoices are listed below 50% of the equivalent quarter in 2019. Once the.
company’s gross receipts exceed 80% of an equivalent quarter in 2019 they no longer qualify.
after completion of that quarter.
Estimation of the Credit.
The amount of the credit is 50% of the certifying earnings paid up to $10,000 in overall.
It is effective for wages paid after March 13th and prior to December 31, 2020.
The meaning of qualifying earnings differs by whether an employer had, on average, basically than.
100 workers in 2019.
Business that concentrate on ERC filing assistance normally supply expertise and support to help businesses navigate the complicated procedure of claiming the credit. They can offer various services, including:.
How is the employee retention credit calculated? Is There An Employee Retention Credit
Eligibility Assessment: These companies will assess your business’s eligibility for the ERC based on elements such as your market, income, and operations. They can assist identify if you fulfill the requirements for the credit and determine the optimum credit quantity you can claim.
Documents and Estimation: ERC filing services will assist in gathering the required documentation, such as payroll records and monetary declarations, to support your claim. They will likewise help calculate the credit amount based upon qualified earnings and other certifying expenses.
Retroactive Claim Evaluation: If you are qualified to declare the ERC for prior quarters, these companies can review your past payroll records and financials to recognize possible opportunities for retroactive credits. They can assist you modify prior income tax return to claim these refunds.
Filing Support: Business specializing in ERC filings will prepare and send the needed forms and documentation on your behalf. This consists of finishing Form 941 or any other necessary tax return.
Compliance and Updates: ERC regulations and guidance have evolved gradually. These business remain upgraded with the latest modifications and ensure that your filings adhere to the most present standards. They can likewise supply ongoing support if the internal revenue service requests additional details or performs an audit related to your ERC claim.
It’s important to research and vet any business providing ERC filing support to ensure their trustworthiness and knowledge. Look for recognized companies with experience in tax and payroll services, or consider reaching out to trusted accounting firms or tax experts who provide ERC filing assistance.
Keep in mind that while these companies can offer valuable assistance, it’s always a great concept to have a standard understanding of the ERC requirements and procedure yourself. This will help you make notified decisions and make sure precise filings.
The Worker Retention Credit (ERC) is a refundable tax credit presented by the U.S. government as part of COVID-19 relief procedures. The objective of the ERC is to encourage companies to retain and pay their employees throughout the pandemic, even if their operations have actually been impacted.
Here are some key points about the ERC:.
Eligibility: The ERC is available to qualified employers, consisting of for-profit organizations, tax-exempt organizations, and certain governmental entities. To qualify, companies should meet one of two requirements:.
Business operations were completely or partly suspended due to a federal government order related to COVID-19.
Business experienced a significant decline in gross invoices. As pointed out earlier, for 2021, a considerable decline is specified as a 20% decline in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a significant decline is defined as a 20% decline in gross invoices compared to the very 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 employer’s share of Social Security taxes. The credit quantity amounts to a percentage (approximately 70%) of certified earnings paid to staff members, including certain health insurance expenditures. The maximum 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 got a Paycheck Security Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 permits services to declare the ERC even if they received a PPP loan. The very same earnings can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has actually been retroactively expanded and boosted, permitting qualified employers to claim the credit for certified salaries paid as far back as March 13, 2020. This retroactive arrangement supplies an opportunity for businesses to amend prior-year tax returns and receive refunds.
Claiming the Credit: Employers can declare the ERC by reporting it on their work income tax return, generally Kind 941. The excess can be reimbursed to the employer if the credit goes beyond the amount of employment taxes owed.
It’s important to note that the ERC arrangements and eligibility requirements have developed in time. The best strategy is to consult with a tax professional or visit the main internal revenue service site for the most comprehensive and current information relating to the ERC, including any recent legislative modifications or updates.
To receive the ERC, a company should fulfill one of the following requirements:.
The business operations were completely or partly suspended due to a government order related to COVID-19.
The business experienced a substantial decrease in gross invoices. For 2021, a considerable decrease is specified as a 20% decline in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a significant decrease is defined as a 20% decline in gross invoices compared to the very same quarter in 2019, or a 20% decline in gross invoices compared to the right away preceding quarter.
The ERC is readily available to businesses of all sizes, consisting of tax-exempt companies, however there are some exceptions. For example, federal government entities and services that got a PPP loan may have constraints on claiming the credit.
The procedure for declaring the ERC includes completing the needed kinds and including the credit on your work tax return (generally Kind 941). The exact time it takes to process the credit can vary based on a number of elements, consisting of the intricacy of your organization and the workload of the internal revenue service. It’s advised to talk to a tax professional for guidance specific to your scenario.
There are a number of business that can help with the process of claiming the ERC. Some well-known companies that provide support with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the info offered here is based upon basic knowledge and may not reflect the most current updates or modifications to the ERC. It is very important to consult with a tax professional or check out the main IRS site for the most up-to-date and precise info regarding eligibility, claiming treatments, and offered help.
Less than 100. If the employer had 100 or less staff members typically in 2019, then the credit is based.
on wages paid to all staff members whether they in fact worked or not. Simply put, even if the.
staff members 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 typically in 2019, then the credit is.
allowed only for salaries paid to workers who did not work throughout the calendar quarter.
In both cases, “wages” consists of not simply money payments however likewise a part of the cost of employer.
offered healthcare. Is There An Employee Retention Credit
Employers can be instantly repaid for the credit by reducing the amount of payroll taxes they.