Lets talk first about Is There Such Thing As Employee Retention Credit :
Our group here what do these men doing everybody in this space is assisting teach individuals about ERC and uh always supply a beautiful breakfast and have people really learn about the program we need to head to the room where we have the ability to display some of the checks that we are getting for business and I wish to see that what is this this is uh numerous countless dollars literally Kevin hundreds of countless dollars so these are duplicate copies of the letters that go to customers confirming that the check is on the method I suggest you understand 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 mean it’s simply I indicate consider the number of real customers 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 confirmed 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 understand when you
receive this you understand the check is gone for sure which’s when they pay so they do not pay anything till they actually receive the cash they do not pay bottom line Wonder trust anything until this letter is verified the check is on the method they transfer it into their savings account and they can genuinely rely on Wonder trust that the procedure has actually been finished and how many you think you have actually processed because you began this we’re about 35 000 of these for
about six billion dollars wow so clearly they know what they’re doing and that’s what you require you require experts 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 important today the employee retention credit which the majority of you have never become aware of I definitely hadn’t heard of it until really recently and learned a lot about it due to the fact that this is most likely the most affordable cost of capital for any small business anywhere
anytime if you have workers between 5 and five hundred so I’ve got the expert with me this is Josh Fox he’s the creator and CEO of bottom line Principles 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 phone your bank manager and state give me a loan it doesn’t 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 disappearing soon you got to learn 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 created the cares Act and the cares act provided businesses 3 opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and almost everyone it makes a huge difference right there 2 of them are loans and one’s a refund precisely so the ERC is a refund that’s.
fix the cash cash payroll tax refund alright go on sorry I simply need to make certain we got that point I indicate that’s a huge distinction a loan versus money cash I like cash cash that’s what we’re talking 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 initial cares Act is the ERC and yes Kevin it is a stunning hard check in the mail where you get real money from the IRS 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 worker retention credit that individual had to be a staff member so I’m going to make the Assumption this money is not for the owner not for individuals on the cap table not for shareholders it’s for workers right you had to have actually owned a business 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 eligible so you have 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 six quarters the program was open well stroll us through the six quarters so you had quarters two three and four of 2020 and you had quarters one 2 and 3 of 2021. all right so that’s how it’s determined you need to be on the W-2 throughout that period now let’s talk my favorite part money how much can you return per staff member that was on a W-2 in those six quarters so the estimation in 2020 to be specific Kevin is 50 of the worker’s income to an optimum of five thousand dollars per worker for the year of 2020 and in 2021 the numbers increased to 70 of the staff member’s salary to a maximum of seven thousand per quarter how did that happen um they just altered the rules in.
2021 versus since the turmoil 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 5 thousand Max and after that what occurs 21 000 Max in 2021 oh that’s how you develop 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 cash it is now there’s a caution here the PPP money would have to be reduced from the twenty six thousand dollars so if you took PPP loan one and PPP loan two you would minimize the 26 000 so what we’re seeing on average Kevin is if you took PPP cash someplace around 10 thousand dollars a person so let’s state hypothetically you owned a restaurant in New York 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 concern is why does no one learn about this since look when I first heard about this when I initially satisfied Josh you know I’ve got lots of financial investments in great deals of business I’m a major supporter for entrepreneurship in America and make numerous numerous financial 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 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 and that were well deserved and we utilized them wisely to stay alive throughout 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 political leader pals Governor Senators they didn’t know 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 also not real so let’s ask Josh why does nobody know about the staff member retention credit you understand what’s intriguing you’re speaking about the banks Kevin because in the PPP loan procedure 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 big banks in our nation and they would process process in Canada a pre-pp loan there’s no loans in Canada by the way it’s simply process procedure that’s all um and here there was mayhem because remember in the original cares act you could not do both programs so if you had actually done PPP you could not do ERC in the original program and when they altered the law in 2021 the banks were not doing ERC since it’s not alone so you’re getting a tax refund so the federal government never made it clear to any person about how to.
do this does your CFO understand how to do this not truly she or he’s never done it previously do the banks do it nope the banks do not do it the payroll business yeah some of them are doing it as a payroll business your accounting professional no your accountant’s never done this before unless you have an account that went into this company and bottom line my firm Kevin has actually stayed in business given that 2009 and we’ve been working with the federal government and the state federal government to recuperate money for Fortune 500 Fortune 1000 business so a lot of our huge huge corporate customers have worked with bottom line to recuperate other government programs we have actually done sales tax and use tax unemployment tax work chance tax credits research and development tax credits unclaimed home property tax all of these other government programs.
The worker retention tax credit is a broad based refundable tax credit created to encourage.
employers to keep staff members on their payroll. The credit is 50% of approximately $10,000 in earnings paid by an.
company whose service is completely or partially suspended because of COVID-19 or whose gross invoices.
decline by more than 50%.
1. The credit is readily available to all companies regardless of size consisting of tax exempt organizations. There are.
only two exceptions: (1) state and local governments and their instrumentalities and (2) little.
businesses who take Small Business Loans.
2. To certify, the company needs to meet one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the company’s service is fully or partially suspended by federal government order due to COVID-19.
during the calendar quarter or.
o the employer’s gross invoices are listed below 50% of the similar quarter in 2019. Once the.
employer’s gross receipts go above 80% of a similar 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 qualifying earnings paid up to $10,000 in overall.
It works for salaries paid after March 13th and prior to December 31, 2020.
The meaning of certifying incomes varies by whether a company had, typically, more or less than.
100 staff members in 2019.
Companies that specialize in ERC filing support generally provide proficiency and support to help businesses browse the complicated process of declaring the credit. They can use various services, including:.
How is the employee retention credit calculated? Is There Such Thing As Employee Retention Credit
Eligibility Evaluation: These business will examine your company’s eligibility for the ERC based upon elements such as your industry, income, and operations. They can assist determine if you meet the requirements for the credit and determine the maximum credit amount you can claim.
Documentation and Computation: ERC filing services will assist in gathering the required paperwork, such as payroll records and monetary statements, to support your claim. They will likewise assist determine the credit amount based on eligible salaries and other qualifying costs.
Retroactive Claim Evaluation: If you are eligible to claim the ERC for prior quarters, these business can review your past payroll records and financials to identify prospective chances for retroactive credits. They can help you amend previous income tax return to declare these refunds.
Filing Help: Companies focusing on ERC filings will prepare and send the required types and documentation in your place. This consists of completing Form 941 or any other required tax forms.
Compliance and Updates: ERC guidelines and assistance have developed with time. These companies remain updated with the latest modifications and ensure that your filings abide by the most present standards. If the Internal revenue service requests additional information or carries out an audit related to your ERC claim, they can also supply continuous support.
It is very important to research study and veterinarian any business using ERC filing assistance to ensure their credibility and expertise. Try to find established firms with experience in tax and payroll services, or think about reaching out to relied on accounting companies or tax experts who offer ERC submitting support.
Keep in mind that while these business can provide important assistance, it’s constantly a great concept to have a basic understanding of the ERC requirements and procedure yourself. This will help you make informed choices and ensure accurate filings.
The Employee Retention Credit (ERC) is a refundable tax credit presented by the U.S. federal government as part of COVID-19 relief steps. The objective of the ERC is to motivate organizations 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 offered to qualified companies, including for-profit organizations, tax-exempt organizations, and specific governmental entities. To qualify, employers should satisfy one of two requirements:.
Business operations were totally or partially suspended due to a federal government order related to COVID-19.
The business experienced a significant decline in gross receipts. As discussed previously, for 2021, a significant decline is specified as a 20% decline in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a significant decline is defined as a 20% decline in gross receipts compared to the very same quarter in 2019, or a 20% decline in gross invoices 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 quantity amounts to a portion (approximately 70%) of qualified earnings paid to workers, consisting of particular health insurance expenses. 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 an Income Defense Program (PPP) loan were not qualified for the ERC. However, legislation passed in late 2020 and extended in 2021 enables services to claim the ERC even if they got a PPP loan. The exact same incomes can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has actually been retroactively broadened and enhanced, permitting qualified employers to declare the credit for certified incomes paid as far back as March 13, 2020. This retroactive arrangement offers a chance for services to amend prior-year tax returns and get refunds.
Claiming the Credit: Employers can claim the ERC by reporting it on their employment income tax return, normally Type 941. If the credit exceeds the quantity of work taxes owed, the excess can be refunded to the employer.
It is necessary to note that the ERC arrangements and eligibility requirements have actually developed in time. The best strategy is to consult with a tax professional or go to the main IRS website for the most detailed and updated information concerning the ERC, including any recent legislative modifications or updates.
To receive the ERC, a service should meet one of the following criteria:.
The business operations were completely or partially suspended due to a government order related to COVID-19.
Business experienced a significant decline in gross receipts. For 2021, a considerable decline is defined as a 20% decline in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a significant decline is specified as a 20% decline in gross receipts compared to the same quarter in 2019, or a 20% decrease in gross receipts compared to the immediately preceding quarter.
The ERC is available to businesses of all sizes, consisting of tax-exempt organizations, but there are some exceptions. For instance, government entities and businesses that received a PPP loan might have limitations on claiming the credit.
The procedure for declaring the ERC involves completing the essential forms and including the credit on your employment income tax return (generally Type 941). The exact time it requires to process the credit can differ based on a number of elements, consisting of the complexity of your organization and the workload of the IRS. It’s recommended to talk to a tax expert for assistance specific to your circumstance.
There are numerous business that can help with the process of declaring 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 details supplied here is based on basic understanding and might not show the most current updates or modifications to the ERC. It is essential to seek advice from a tax professional or go to the main internal revenue service site for the most accurate and up-to-date details concerning eligibility, declaring procedures, and available help.
Less than 100. If the company had 100 or less workers typically in 2019, then the credit is based.
on salaries paid to all staff members whether they actually worked or not. To put it simply, even if the.
workers worked full time and made money for full-time work, the employer still gets the credit.
Greater than 100. If the company had more than 100 workers typically in 2019, then the credit is.
permitted just for wages paid to staff members who did not work throughout the calendar quarter.
In both cases, “wages” includes not just cash payments however likewise a part of the cost of company.
provided healthcare. Is There Such Thing As Employee Retention Credit
Companies can be instantly reimbursed for the credit by minimizing the quantity of payroll taxes they.