Lets talk first about Payroll Protection Program And Employee Retention Credit :
Our group here what do these people doing everybody in this space is assisting teach people about ERC and uh always supply a stunning breakfast and have people actually discover the program we ought to head to the room where we are able to display a few of the checks that we are getting for companies and I wish to see that what is this this is uh hundreds of millions of dollars literally Kevin hundreds of countless dollars so these are duplicate copies of the letters that go to clients validating that the check is on the method I mean you know if you simply begin to 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 suggest think of the number of actual clients that went through the program yeah this is the very end this is the party at the end when the check is confirmed the numbers are validated and the check is on the mail in the mail from the IRS heading to the consumer so that’s how you have the ability to track it you know when you
get this you understand the check is opted for sure and that’s when they pay so they don’t pay anything till they really receive the money they don’t pay bottom line Wonder trust anything till this letter is confirmed 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 completed and how many you think you have actually 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 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 Wonderful here you’re at my YouTube channel we’re talking about something truly crucial today the employee retention credit which the majority of you have never ever become aware of I certainly hadn’t heard of it up until really just recently and discovered a lot about it because this is probably the most affordable cost of capital for any small company anywhere
anytime if you have employees between five and five hundred so I’ve got the specialist 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 not easy this isn’t like PPP we just call up your bank manager and say give me a loan it does not 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 ended up being yes the Ambassador and paid representative for this I enjoy this program it’s disappearing very soon you got to learn everything about it let’s talk worker retention credit Josh Fox what is an ERC let’s simply start there so during the Trump Administration when President Trump was enacted they developed the cares Act and the cares act offered services 3 opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly everybody it makes a big difference 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 have to make sure we got that point I indicate that’s a big difference a loan versus cash money I like money money 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 stunning difficult check in the mail where you get actual cash from the internal revenue service all right so let’s talk about how it works because it seems like to me if it’s a if it’s staff member retention credit that individual needed to be an employee 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 workers right you had to have actually owned a business but it’s based upon 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 very first six months of 2021 on the W-2 proper so there were 6 quarters the program was open well stroll us through the 6 quarters so you had quarters two 3 and four of 2020 and you had quarters one 2 and three of 2021. alright so that’s how it’s measured you have to be on the W-2 throughout that period now let’s talk my preferred part cash how much can you return per staff member that was on a W-2 in those 6 quarters so the calculation in 2020 to be exact Kevin is 50 of the staff member’s wage to a maximum of five thousand dollars per worker for the year of 2020 and in 2021 the numbers increased to 70 of the staff member’s income to an optimum of 7 thousand per quarter how did that happen um they just changed the rules in.
2021 versus due to the fact that 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 as much as five thousand Max and after that what takes place 21 000 Max in 2021 oh that’s how you develop twenty six thousand twenty one thousand to twenty twenty one plus five thousand in twenty twenty that’s twenty six thousand dollars per employee that is since that’s a lot of cash it is now there’s a caution here the PPP money would have to be decreased from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan two you would decrease the 26 000 so what we’re seeing on average Kevin is if you took PPP money somewhere around ten thousand dollars a person so let’s state 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 cash you would still get a million dollar in the mail from the IRS so it’s big obviously now the big concern is why does no one understand about this due to the fact that appearance when I first became aware of this when I initially met 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 many numerous investments in entrepreneurs of which lots of suffered through the pandemic when I first found out about this I called BS I do not think it because I utilize the PPP we went through the money 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 should have and we utilized them wisely to survive throughout the pandemic so when I found out about this I said nah it can’t be true however when I dug around I even contacted us to my politician friends Guv Senators they didn’t understand about it I suggest that’s how you understand that’s how misinformation is that there’s no details out there then a bunch of people told me well you can’t get it since you took the PPP likewise not true so let’s ask Josh why does no one learn about the staff member retention credit you understand what’s intriguing 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 nation and they would process procedure 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 remember 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 original program and when they altered the law in 2021 the banks were not doing ERC because it’s not alone so you’re getting a tax refund so the government never ever made it clear to anyone about how to.
do this does your CFO know how to do this not truly she or he’s never done it before 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 business your accountant no your accounting professional’s never done this prior to unless you have an account that went into this organization and bottom line my company Kevin has actually been in business considering that 2009 and we have actually been dealing with the federal government and the state federal government to recuperate cash for Fortune 500 Fortune 1000 companies so a lot of our big huge corporate customers have dealt with bottom line to recover other government programs we have actually done sales tax and use tax unemployment tax work opportunity tax credits research and development tax credits unclaimed property real estate tax all of these other federal government programs.
The staff member retention tax credit is a broad based refundable tax credit designed to motivate.
companies to keep workers on their payroll. The credit is 50% of up to $10,000 in salaries paid by an.
Since of COVID-19 or whose gross invoices, company whose organization is completely or partly suspended.
decrease by more than 50%.
1. The credit is available to all employers regardless of size including tax exempt organizations. There are.
only 2 exceptions: (1) state and city governments and their instrumentalities and (2) small.
businesses who take Small Business Loans.
2. To certify, the employer has to fulfill one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the company’s service is fully or partly suspended by government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross receipts are listed below 50% of the comparable quarter in 2019. As soon as the.
company’s gross invoices go above 80% of an equivalent quarter in 2019 they no longer qualify.
after completion of that quarter.
Calculation of the Credit.
The amount of the credit is 50% of the qualifying wages paid up to $10,000 in total.
It is effective for wages paid after March 13th and before December 31, 2020.
The meaning of qualifying earnings varies by whether an employer had, usually, basically than.
100 employees in 2019.
Companies that concentrate on ERC filing support usually provide proficiency and assistance to assist businesses navigate the complicated process of claiming the credit. They can provide numerous services, consisting of:.
How is the employee retention credit calculated? Payroll Protection Program And Employee Retention Credit
Eligibility Assessment: These companies will examine your company’s eligibility for the ERC based on factors such as your industry, earnings, and operations. If you fulfill the requirements for the credit and identify the maximum credit quantity you can claim, they can help figure out.
Paperwork and Calculation: ERC filing services will assist in collecting the essential documentation, such as payroll records and monetary declarations, to support your claim. They will also assist calculate the credit quantity based upon qualified salaries and other certifying costs.
Retroactive Claim Review: If you are qualified to claim the ERC for previous quarters, these companies can examine your previous payroll records and financials to recognize prospective opportunities for retroactive credits. They can help you change previous tax returns to declare these refunds.
Filing Assistance: Business specializing in ERC filings will prepare and submit the essential types and documentation in your place. This consists of finishing Kind 941 or any other necessary tax forms.
Compliance and Updates: ERC policies and assistance have actually evolved gradually. These business remain upgraded with the latest modifications and ensure that your filings adhere to the most present guidelines. They can also offer ongoing support if the internal revenue service requests extra information or carries out an audit related to your ERC claim.
It is very important to research and veterinarian any business using ERC filing support to guarantee their trustworthiness and know-how. Search for recognized firms with experience in tax and payroll services, or think about reaching out to relied on accounting firms or tax professionals who offer ERC submitting assistance.
Bear in mind that while these business can supply valuable help, it’s constantly a great concept to have a basic understanding of the ERC requirements and process yourself. This will assist you make notified decisions and guarantee accurate 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 goal of the ERC is to encourage services to maintain and pay their staff members throughout the pandemic, even if their operations have been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is available to qualified companies, including for-profit services, tax-exempt organizations, and particular governmental entities. To certify, employers must fulfill one of two 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. As pointed out previously, for 2021, a significant decrease is defined as a 20% decline in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a substantial decline is specified as a 20% decline in gross invoices compared to the 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 is equal to a portion (as much as 70%) of qualified salaries paid to workers, including specific health insurance expenditures. The maximum credit per staff member is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, companies that received a Paycheck Security Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 allows services to declare the ERC even if they got a PPP loan. Nevertheless, the very same incomes can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively broadened and enhanced, allowing eligible employers to claim the credit for qualified incomes paid as far back as March 13, 2020. This retroactive provision provides a chance for businesses to amend prior-year income tax return and receive refunds.
Declaring the Credit: Companies can declare the ERC by reporting it on their employment tax returns, usually Type 941. The excess can be refunded to the employer if the credit surpasses the amount of employment taxes owed.
It is necessary to keep in mind that the ERC arrangements and eligibility criteria have actually evolved with time. The best course of action is to seek advice from a tax professional or go to the main internal revenue service site for the most comprehensive and up-to-date info relating to the ERC, consisting of any recent legislative changes or updates.
To qualify for the ERC, a company needs to satisfy one of the following requirements:.
The business operations were completely or partially suspended due to a government order related to COVID-19.
Business experienced a substantial decrease in gross receipts. For 2021, a significant decrease is specified as a 20% decline in gross invoices 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% decrease in gross receipts compared to the right away preceding quarter.
The ERC is available to businesses of all sizes, consisting of tax-exempt companies, however there are some exceptions. For instance, government entities and services that got a PPP loan might have constraints on claiming the credit.
The process for declaring the ERC includes completing the required kinds and consisting of the credit on your work income tax return (usually Kind 941). The exact time it takes to process the credit can vary based upon a number of elements, including the complexity of your service and the work of the IRS. It’s recommended to seek advice from a tax professional for assistance specific to your situation.
There are numerous business that can assist with the process of declaring the ERC. These include accounting firms, tax advisory services, and payroll company. Some well-known business that provide assistance with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s a good idea to research study and contact these business directly to inquire about their costs and services.
Please note that the details provided here is based upon general understanding and may not show the most current updates or changes to the ERC. It’s important to talk to a tax expert or go to the official internal revenue service site for the most precise and updated information 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 really worked or not. To put it simply, even if the.
employees worked full time and made money for full-time work, the employer still gets the credit.
Greater than 100. The credit is if the employer had more than 100 employees on average in 2019.
allowed just for incomes paid to employees who did not work throughout the calendar quarter.
In both cases, “salaries” includes not simply money payments but likewise a part of the expense of company.
offered healthcare. Payroll Protection Program And Employee Retention Credit
Companies can be instantly reimbursed for the credit by reducing the quantity of payroll taxes they.