Lets talk first about S Corp Employee Retention Credit :
Our team here what do these people doing everybody in this space is assisting teach individuals about ERC and uh constantly supply a lovely breakfast and have individuals actually learn about the program we must head to the room where we are able to show some 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 actually Kevin numerous millions of dollars so these are replicate copies of the letters that go to clients verifying that the check is on the method I indicate you know if you just start to take a look at a few of these here I indicate this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I mean it’s just I mean think about how many actual customers 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 verified 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 gone for sure and that’s when they pay so they don’t pay anything up until they in fact get the cash they do not pay bottom line Wonder trust anything until this letter is verified the check is on the method they deposit it into their checking account and they can really trust Wonder trust that the process has been completed and how many you think you’ve processed because you began this we have to do with 35 000 of these for
about six billion dollars wow so plainly they understand what they’re doing which’s what you need you require 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 discussing something actually important today the worker retention credit which the majority of you have never become aware of I definitely had not heard of it till really just recently and found out a lot about it because 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 specialist with me this is Josh Fox he’s the founder and CEO of bottom line Concepts they’re the largest processor of these ERC credits this is a 170 page program so it’s hard this isn’t like PPP we just call up your bank manager and say give me a loan it doesn’t work there’s not a loan it’s an application and Josh is going to inform all of us about it and how to get it and why I’ve become yes the Ambassador and paid spokesperson for this I enjoy this program it’s disappearing very soon you got to discover all about it let’s talk staff member retention credit Josh Fox what is an ERC let’s just start there so throughout 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 almost everybody it makes a huge difference right there 2 of them are loans and one’s a refund exactly so the ERC is a refund that’s.
correct the cash money payroll tax refund all right go on sorry I simply need to make certain we got that point I mean that’s a big distinction a loan versus cash money I like money money that’s what we’re discussing 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 difficult check in the mail where you get real money from the internal revenue service all right so let’s speak about how it works due to the fact that it sounds like to me if it’s a if it’s employee retention credit that person had to be a staff member so I’m going to make the Assumption this cash is not for the owner not for people on the cap table not for investors it’s for employees right you needed to have owned a business but it’s based upon you having W-2 workers 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 very first six months of 2021 on the W-2 right so there were six quarters the program was open well stroll us through the 6 quarters so you had quarters 2 3 and four of 2020 and you had quarters one two and three of 2021. okay 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 how much can you return per worker that was on a W-2 in those 6 quarters so the computation in 2020 to be exact Kevin is 50 of the employee’s income to a maximum of five thousand dollars per employee for the year of 2020 and in 2021 the numbers escalated to 70 of the staff member’s salary to a maximum of seven thousand per quarter how did that occur um they just altered the rules in.
2021 versus because 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 up to five 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 five thousand in twenty twenty that’s twenty 6 thousand dollars per staff member that is because that’s a lot of money it is now there’s a caution here the PPP cash would have to be minimized 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 typically Kevin is if you took PPP money someplace around ten 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 workers and you took PPP cash you would still get a million dollar in the mail from the internal revenue service so it’s huge certainly now the big question is why does no one understand about this due to the fact that look when I initially became aware of this when I first fulfilled Josh you know I have actually got lots of financial investments in lots of companies I’m a significant supporter for entrepreneurship in America and make numerous numerous financial investments in business owners of which numerous suffered through the pandemic when I initially heard about this I called BS I don’t believe it since I use 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 carefully to survive throughout the pandemic so when I became aware of this I stated nah it can’t be true but when I dug around I even contacted us to my political leader good friends Guv Senators they didn’t know about it I imply that’s how you understand that’s how false information is that there’s no info out there then a bunch of people told 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 nobody learn about the staff member retention credit you understand what’s intriguing you’re discussing the banks Kevin due to the fact that in the PPP loan procedure the federal government made it really 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 simply procedure procedure that’s all um and here there was mayhem due to the fact that keep in mind in the initial cares act you could refrain from doing both programs so if you had done PPP you could refrain from doing ERC in the initial 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 federal government never ever made it clear to anyone about how to.
do this does your CFO understand how to do this not really she or he’s never ever done it in the past do the banks do it nope the banks do not do it the payroll companies yeah some of them are doing it as a payroll company your accounting professional no your accountant’s never done this prior to unless you have an account that entered into this service and bottom line my company Kevin has been in business because 2009 and we’ve been working with the federal government and the state federal government to recuperate cash for Fortune 500 Fortune 1000 business so a great deal of our huge huge business customers have dealt with bottom line to recuperate other government programs we’ve done sales tax and utilize tax joblessness tax work opportunity tax credits research and development tax credits unclaimed home real estate tax all of these other federal government programs.
The employee retention tax credit is a broad based refundable tax credit designed to encourage.
employers to keep staff members on their payroll. The credit is 50% of approximately $10,000 in wages paid by an.
company whose business is fully or partly suspended because of COVID-19 or whose gross receipts.
decline by more than 50%.
1. The credit is readily available to all employers no matter size consisting of tax exempt companies. There are.
only two exceptions: (1) state and local governments and their instrumentalities and (2) small.
organizations who take Small company Loans.
2. To qualify, the company has to fulfill 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 employer’s gross receipts are listed below 50% of the equivalent quarter in 2019. Once the.
company’s gross invoices exceed 80% of a comparable quarter in 2019 they no longer certify.
after the end of that quarter.
Estimation of the Credit.
The quantity of the credit is 50% of the certifying wages paid up to $10,000 in total.
It works for salaries paid after March 13th and prior to December 31, 2020.
The definition of qualifying earnings varies by whether an employer had, usually, basically than.
100 workers in 2019.
Business that specialize in ERC filing assistance generally supply proficiency and assistance to help organizations navigate the complex process of declaring the credit. They can offer different services, including:.
How is the employee retention credit calculated? S Corp Employee Retention Credit
Eligibility Assessment: These business will examine your company’s eligibility for the ERC based on elements such as your market, profits, and operations. If you fulfill the requirements for the credit and determine the optimum credit quantity you can declare, they can help figure out.
Documentation and Estimation: ERC filing services will help in collecting the needed paperwork, such as payroll records and monetary statements, to support your claim. They will also assist calculate the credit quantity based on qualified wages and other qualifying costs.
Retroactive Claim Review: If you are qualified to declare the ERC for previous quarters, these business can review your past payroll records and financials to determine potential opportunities for retroactive credits. They can help you modify previous income tax return to claim these refunds.
Filing Assistance: Business specializing in ERC filings will prepare and submit the needed forms and documentation on your behalf. This consists of finishing Type 941 or any other necessary tax return.
Compliance and Updates: ERC guidelines and guidance have actually progressed over time. These companies stay upgraded with the most recent modifications and make sure that your filings comply with the most current standards. They can likewise provide ongoing support if the internal revenue service demands additional info or carries out an audit related to your ERC claim.
It is essential to research study and veterinarian any business offering ERC filing support to ensure their trustworthiness and knowledge. Look for established firms with experience in tax and payroll services, or consider connecting to trusted accounting firms or tax specialists who use ERC filing assistance.
Remember that while these companies can provide important assistance, it’s constantly a great concept to have a fundamental understanding of the ERC requirements and procedure yourself. This will assist you make informed decisions and guarantee accurate filings.
The Staff Member 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 services to retain and pay their workers throughout the pandemic, even if their operations have been impacted.
Here are some key points about the ERC:.
Eligibility: The ERC is available to qualified employers, including for-profit businesses, tax-exempt companies, and specific governmental entities. To certify, companies must meet one of two requirements:.
Business operations were totally or partially suspended due to a government order related to COVID-19.
Business experienced a significant decline in gross invoices. As discussed earlier, for 2021, a significant decline is specified as a 20% decline in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a substantial decline is defined as a 20% decline in gross receipts compared to the very same quarter in 2019, or a 20% decrease in gross invoices compared to the right away preceding quarter.
Credit Amount: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit quantity is equal to a portion (up to 70%) of certified earnings paid to staff members, including particular health plan costs. The maximum credit per worker 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 Protection Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 permits businesses to declare the ERC even if they received a PPP loan. The same incomes can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively expanded and improved, permitting qualified employers to claim the credit for qualified incomes paid as far back as March 13, 2020. This retroactive provision offers an opportunity for businesses to change prior-year income tax return and get refunds.
Claiming the Credit: Employers can declare the ERC by reporting it on their work income tax return, normally Type 941. If the credit surpasses the quantity of work taxes owed, the excess can be refunded to the company.
It is necessary to note that the ERC arrangements and eligibility criteria have actually evolved with time. The best course of action is to speak with a tax professional or go to the official IRS site for the most comprehensive and up-to-date details concerning the ERC, consisting of any recent legal modifications or updates.
To receive the ERC, an organization must meet one of the following requirements:.
The business operations were totally or partially suspended due to a government order related to COVID-19.
Business experienced a significant decrease in gross receipts. For 2021, a significant decline is specified as a 20% decrease in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a substantial decline is specified 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.
The ERC is available to services of all sizes, consisting of tax-exempt companies, but there are some exceptions. For instance, government entities and organizations that received a PPP loan might have restrictions on claiming the credit.
The process for claiming the ERC includes finishing the essential forms and including the credit on your work income tax return (normally Kind 941). The exact time it takes to process the credit can differ based upon several factors, including the complexity of your service and the workload of the internal revenue service. It’s recommended to speak with a tax professional for guidance particular to your situation.
There are numerous business that can aid with the process of declaring the ERC. These include accounting firms, tax advisory services, and payroll provider. Some well-known companies that provide help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s advisable to research study and contact these business straight to inquire about their services and charges.
Please note that the info offered here is based on general understanding and might not show the most current updates or modifications to the ERC. It’s important to talk to a tax expert or visit the main internal revenue service website for the most up-to-date and accurate information relating to eligibility, declaring procedures, and available support.
Less than 100. If the company had 100 or fewer staff members on average in 2019, then the credit is based.
on earnings paid to all staff members whether they actually worked or not. To put it simply, even if the.
staff members worked full-time and got paid 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.
allowed just for earnings paid to employees who did not work during the calendar quarter.
In both cases, “incomes” includes not simply money payments but likewise a portion of the cost of company.
offered healthcare. S Corp Employee Retention Credit
Employers can be immediately reimbursed for the credit by decreasing the amount of payroll taxes they.