Lets talk first about S Corp Owner Employee Retention Credit :
Our group here what do these men doing everybody in this room is assisting teach individuals about ERC and uh constantly supply a gorgeous breakfast and have individuals truly learn about the program we need to head to the space where we have the ability to display 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 literally Kevin numerous countless dollars so these are replicate copies of the letters that go to customers validating that the check is on the way I suggest 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 indicate it’s simply I imply consider the number of real clients 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 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 understand when you
receive this you understand the check is opted for sure which’s when they pay so they do not pay anything up until they in fact receive the money they don’t pay bottom line Wonder trust anything till this letter is verified the check is on the method they deposit it into their savings account and they can truly rely on Wonder trust that the process has actually been finished and the number of you think you have actually processed considering that you started this we have to do with 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 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 Fantastic here you’re at my YouTube channel we’re talking about something truly crucial today the worker retention credit which the majority of you have never ever heard of I certainly had not heard of it up until really 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 staff members between five and five hundred so I have actually 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 hard this isn’t like PPP we simply call up your bank supervisor and state provide me a loan it does not 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 ended up being yes the Ambassador and paid representative for this I like 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 simply start there so during the Trump Administration when President Trump was enacted they came up with the cares Act and the cares act used companies 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 distinction right there two of them are loans and one’s a refund precisely so the ERC is a refund that’s.
remedy the cash cash payroll tax refund okay go on sorry I simply need to make certain we got that point I suggest that’s a big difference a loan versus cash money I like cash cash that’s what we’re speaking about fine 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 gorgeous tough check in the mail where you get actual money from the IRS all right so let’s talk about how it works since it seems like to me if it’s a if it’s staff member 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 individuals on the cap table not for shareholders it’s for staff members right you had to have actually owned a service but it’s based on you having W-2 employees in America not 10.99. so as long as you had W-2 staff members and you paid federal payroll taxes that’s why you would be qualified so you need 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 appropriate so there were six quarters the program was open well walk 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 measured you need to be on the W-2 throughout that period now let’s talk my favorite part cash how much can you get back per worker that was on a W-2 in those six quarters so the computation in 2020 to be specific Kevin is 50 of the worker’s wage to a maximum of five thousand dollars per employee for the year of 2020 and in 2021 the numbers escalated to 70 of the worker’s salary to a maximum of 7 thousand per quarter how did that happen um they just altered the rules in.
2021 versus due to the fact that the mayhem 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 then what takes place 21 000 Max in 2021 oh that’s how you create twenty 6 thousand twenty one thousand to twenty twenty one plus five thousand in twenty twenty that’s twenty six thousand dollars per worker that is since that’s a lot of cash it is now there’s a caveat here the PPP money would need to be decreased from the twenty six thousand dollars so if you took PPP loan one and PPP loan two you would decrease the 26 000 so what we’re seeing typically Kevin is if you took PPP cash 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 employees and you took PPP cash 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 know about this because appearance when I first heard about this when I first fulfilled Josh you understand I have actually got great deals of financial investments in lots of companies I’m a significant supporter for entrepreneurship in America and make lots of many investments in business owners of which numerous suffered through the pandemic when I first became aware of this I called BS I don’t believe it because I use the PPP we went through the money 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 been worthy of and we utilized them wisely to survive during the pandemic so when I found out about this I stated nah it can’t hold true however when I dug around I even contacted us to my politician buddies Guv Senators they didn’t learn about it I indicate that’s how you know that’s how false information is that there’s no information out there then a lot of people told me well you can’t get it because you took the PPP likewise not true so let’s ask Josh why does nobody learn about the worker retention credit you understand what’s interesting you’re speaking about the banks Kevin because in the PPP loan procedure 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 mayhem due to the fact that remember in the initial cares act you might refrain from doing both programs so if you had actually 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 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 done it before 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 business your accountant no your accounting professional’s never done this prior to unless you have an account that entered into this service and bottom line my firm Kevin has stayed in business considering that 2009 and we’ve been dealing with the federal government and the state government to recuperate money for Fortune 500 Fortune 1000 companies so a lot of our huge huge corporate clients have worked with bottom line to recover other federal government programs we’ve done sales tax and utilize tax joblessness tax work chance tax credits research and development tax credits unclaimed home property tax all of these other government programs.
The staff member retention tax credit is a broad based refundable tax credit designed to motivate.
companies to keep staff members on their payroll. The credit is 50% of up to $10,000 in incomes paid by an.
Because of COVID-19 or whose gross invoices, employer whose company is completely or partially suspended.
decline by more than 50%.
Schedule.
1. The credit is available to all employers despite size consisting of tax exempt organizations. There are.
only 2 exceptions: (1) state and local governments and their instrumentalities and (2) little.
businesses who take Small company Loans.
2. To qualify, the company needs to meet one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the company’s service is fully or partially suspended by federal government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross invoices are below 50% of the comparable quarter in 2019. As soon as the.
company’s gross invoices go above 80% of a comparable quarter in 2019 they no longer certify.
after completion of that quarter.
Calculation 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 earnings paid after March 13th and prior to December 31, 2020.
The meaning of certifying salaries varies by whether an employer had, usually, basically than.
100 workers in 2019.
Business that focus on ERC filing support usually provide proficiency and assistance to assist services navigate the intricate procedure of declaring the credit. They can use different services, including:.
How is the employee retention credit calculated? S Corp Owner Employee Retention Credit
Eligibility Evaluation: These business will examine your company’s eligibility for the ERC based upon aspects such as your market, revenue, and operations. If you satisfy the requirements for the credit and determine the maximum credit amount you can declare, they can assist identify.
Paperwork and Computation: 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 determine the credit quantity based on eligible earnings and other qualifying expenditures.
Retroactive Claim Evaluation: If you are eligible to claim the ERC for prior quarters, these companies can review your previous payroll records and financials to determine potential chances for retroactive credits. They can assist you modify prior tax returns to declare these refunds.
Filing Assistance: Business focusing on ERC filings will prepare and submit the required types and paperwork on your behalf. This consists of completing Kind 941 or any other required tax forms.
Compliance and Updates: ERC guidelines and guidance have actually developed with time. These companies remain updated with the current changes and make sure that your filings adhere to the most existing guidelines. If the IRS demands extra details or conducts an audit associated to your ERC claim, they can likewise provide continuous assistance.
It’s important to research and vet any company providing ERC filing support to ensure their credibility and knowledge. Try to find recognized firms with experience in tax and payroll services, or consider reaching out to relied on accounting companies or tax specialists who use ERC filing support.
Remember that while these companies can offer important help, it’s constantly a good idea to have a fundamental understanding of the ERC requirements and procedure yourself. This will assist you make informed choices and make sure accurate filings.
The Employee Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief steps. The objective of the ERC is to motivate companies to keep and pay their staff members during the pandemic, even if their operations have been affected.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is readily available to eligible employers, consisting of for-profit companies, tax-exempt organizations, and particular governmental entities. To certify, companies must fulfill one of two requirements:.
Business operations were totally or partially suspended due to a federal government order related to COVID-19.
Business experienced a substantial decline in gross invoices. As mentioned earlier, for 2021, a substantial decrease is specified as a 20% decline in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a substantial decline is specified as a 20% decrease in gross receipts compared to the exact 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 quantity amounts to a percentage (approximately 70%) of certified wages paid to employees, consisting of certain health plan expenditures. 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, businesses that got an Income Defense Program (PPP) loan were not qualified for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 allows services to claim the ERC even if they received a PPP loan. The exact same earnings can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively broadened and enhanced, permitting eligible companies to declare the credit for certified earnings paid as far back as March 13, 2020. This retroactive provision supplies a chance for businesses to modify prior-year tax returns and receive refunds.
Declaring the Credit: Employers can declare the ERC by reporting it on their employment income tax return, generally Kind 941. The excess can be reimbursed to the employer if the credit exceeds the amount of employment taxes owed.
It’s important to note that the ERC arrangements and eligibility requirements have developed in time. The very best course of action is to consult with a tax professional or visit the official IRS site for the most detailed and updated information concerning the ERC, including any current legal modifications or updates.
To receive the ERC, a service must satisfy among the following requirements:.
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 decline is defined as a 20% decrease in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a considerable decline is specified as a 20% decrease in gross invoices compared to the very same quarter in 2019, or a 20% decline in gross invoices compared to the instantly preceding quarter.
The ERC is readily available to services of all sizes, including tax-exempt organizations, however there are some exceptions. Government entities and services that received a PPP loan might have constraints on declaring the credit.
The process for claiming the ERC includes finishing the required forms and consisting of the credit on your work income tax return (typically Kind 941). The exact time it requires to process the credit can differ based on a number of elements, including the complexity of your service and the workload of the IRS. It’s recommended to talk to a tax professional for assistance specific to your circumstance.
There are numerous companies that can aid with the procedure of claiming the ERC. These consist of accounting firms, tax advisory services, and payroll company. Some well-known companies that use support with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s a good idea to research and contact these companies straight to ask about their services and charges.
Please note that the info provided here is based upon general knowledge and might not reflect the most recent updates or modifications to the ERC. It is very important to consult with a tax professional or visit the official IRS site for the most precise and up-to-date details concerning eligibility, declaring procedures, and offered support.
Less than 100. The credit is based if the employer had 100 or less staff members on average in 2019.
on incomes paid to all employees whether they really worked or not. In other words, even if the.
workers worked full time and earned money for full-time work, the company still gets the credit.
Greater than 100. The credit is if the employer had more than 100 employees on average in 2019.
permitted only for wages paid to workers who did not work during the calendar quarter.
In both cases, “wages” consists of not simply money payments but likewise a part of the cost of company.
provided healthcare. S Corp Owner Employee Retention Credit
Payment.
Employers can be right away reimbursed for the credit by decreasing the amount of payroll taxes they.