Lets talk first about Tips Included In Employee Retention Credit :
Our group here what do these men doing everybody in this room is assisting teach individuals about ERC and uh always provide a lovely breakfast and have individuals really find out about the program we must head to the space where we are able to show a few of the checks that we are getting for business and I want to see that what is this this is uh hundreds of countless dollars literally Kevin hundreds of countless dollars so these are replicate copies of the letters that go to customers validating that the check is on the method I mean you understand if you simply start to look at some of these here I indicate this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I suggest it’s just I mean think about 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 validated the numbers are verified and the check is on the mail in the mail from the internal revenue service heading to the customer so that’s how you have the ability to track it you know when you
receive this you understand the check is opted for sure and that’s when they pay so they don’t pay anything until they in fact receive the money they do not pay bottom line Wonder trust anything until this letter is validated the check is on the method they transfer it into their checking account and they can really rely on Wonder trust that the procedure has been ended up and how many you think you’ve processed since you began this we have to do with 35 000 of these for
about 6 billion dollars wow so plainly they know what they’re doing which’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 speaking about something actually important today the employee retention credit which the majority of you have actually never ever heard of I certainly hadn’t heard of it until extremely recently and learned a lot about it since this is probably the most affordable cost of capital for any small company anywhere
anytime if you have employees between 5 and five hundred so I’ve got the expert 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 not easy this isn’t like PPP we just contact your bank manager and say provide 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 ended up being 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 worker retention credit Josh Fox what is an ERC let’s just begin there so throughout the Trump Administration when President Trump was enacted they created the cares Act and the cares act offered services three opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically 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.
fix the cash cash payroll tax refund alright go on sorry I just have to ensure we got that point I imply that’s a big difference a loan versus cash money I like money money that’s what we’re discussing 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 beautiful difficult check in the mail where you get actual 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 staff member retention credit that individual needed to be a worker so I’m going to make the Assumption this cash is not for the owner not for individuals on the cap table not for shareholders it’s for staff members right you needed to have actually owned a service but it’s based on you having W-2 staff members in America not 10.99. As long as you had W-2 staff members 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 first six months of 2021 on the W-2 right so there were six quarters the program was open well walk us through the six quarters so you had quarters two three and 4 of 2020 and you had quarters one 2 and three of 2021. okay so that’s how it’s measured you need to be on the W-2 throughout that duration now let’s talk my preferred part money how much can you return per employee that was on a W-2 in those 6 quarters so the calculation in 2020 to be precise Kevin is 50 of the employee’s salary to a maximum of 5 thousand dollars per worker for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the employee’s salary to a maximum of 7 thousand per quarter how did that happen um they simply altered the rules in.
2021 versus because the chaos of the pandemic so they wished to even get more to keep those workers 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 then what takes place 21 000 Max in 2021 oh that’s how you come up with twenty 6 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 money it is now there’s a caveat here the PPP cash would need to be lowered from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan two you would lower the 26 000 so what we’re seeing on average Kevin is if you took PPP money someplace around ten thousand dollars an individual so let’s state hypothetically you owned a dining establishment in New York 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 huge obviously now the big question is why does no one learn about this because look when I first found out about this when I first met Josh you understand I’ve got lots of investments in lots of companies I’m a significant supporter for entrepreneurship in America and make lots of many financial investments in entrepreneurs of which many suffered through the pandemic when I initially became aware of this I called BS I do not believe it since I use the PPP we went through the cash center Banks to get it it was extremely easy to do we had our CEOs call the banks they got their loans which were well been worthy of and we utilized them carefully to stay alive throughout the pandemic so when I became aware of this I stated nah it can’t hold true but when I dug around I even contacted us to my politician good friends Governor Senators they didn’t understand about it I indicate that’s how you understand that’s how false information is that there’s no details out there then a bunch of individuals told me well you can’t get it because you took the PPP also not real so let’s ask Josh why does no one understand about the worker retention credit you know what’s interesting you’re talking about the banks Kevin due to the fact that in the PPP loan process 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 huge 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 process procedure that’s all um and here there was turmoil because keep in mind in the original cares act you could not do both programs so if you had actually done PPP you could refrain from doing ERC in the original program and when they changed the law in 2021 the banks were refraining from doing ERC due to the fact that it’s not alone so you’re getting a tax refund so the government never made it clear to anybody about how to.
do this does your CFO understand how to do this not really she or he’s never ever done it previously do the banks do it nope the banks do not 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 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 recover cash for Fortune 500 Fortune 1000 companies so a lot of our big big business clients have dealt with bottom line to recuperate other federal government programs we’ve done sales tax and use tax joblessness tax work chance tax credits research and development tax credits unclaimed property real estate tax all of these other federal government programs.
The worker retention tax credit is a broad based refundable tax credit created to motivate.
employers to keep workers on their payroll. The credit is 50% of as much as $10,000 in earnings paid by an.
employer whose service is fully or partially suspended because of COVID-19 or whose gross receipts.
decline by more than 50%.
1. The credit is available to all employers despite size consisting of tax exempt organizations. There are.
just 2 exceptions: (1) state and city governments and their instrumentalities and (2) little.
companies who take Small Business Loans.
2. To qualify, the employer needs to satisfy one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the company’s service is completely or partially suspended by government order due to COVID-19.
throughout the calendar quarter or.
o the employer’s gross invoices are listed below 50% of the comparable quarter in 2019. As soon as the.
company’s gross invoices go above 80% of a similar quarter in 2019 they no longer certify.
after completion of that quarter.
Computation of the Credit.
The quantity of the credit is 50% of the certifying incomes paid up to $10,000 in total.
It works for earnings paid after March 13th and prior to December 31, 2020.
The definition of qualifying wages varies by whether a company had, usually, basically than.
100 employees in 2019.
Companies that focus on ERC filing assistance usually offer competence and assistance to help businesses navigate the intricate process of declaring the credit. They can provide various services, including:.
How is the employee retention credit calculated? Tips Included In Employee Retention Credit
Eligibility Evaluation: These business will examine your service’s eligibility for the ERC based upon elements such as your industry, income, and operations. If you meet the requirements for the credit and identify the optimum credit amount you can claim, they can help figure out.
Paperwork and Calculation: ERC filing services will assist in collecting the necessary documentation, such as payroll records and monetary statements, to support your claim. They will likewise help determine the credit amount based on qualified wages and other qualifying expenditures.
Retroactive Claim Evaluation: If you are qualified to claim the ERC for prior quarters, these companies can examine your previous payroll records and financials to recognize possible chances for retroactive credits. They can help you change prior income tax return to claim these refunds.
Filing Assistance: Companies specializing in ERC filings will prepare and submit the needed types and paperwork on your behalf. This consists of finishing Kind 941 or any other necessary tax forms.
Compliance and Updates: ERC guidelines and assistance have developed gradually. These business stay updated with the most recent modifications and ensure that your filings abide by the most present standards. They can also provide continuous support if the IRS demands additional information or conducts an audit related to your ERC claim.
It is essential to research and vet any company providing ERC filing support to guarantee their trustworthiness and expertise. Look for established companies with experience in tax and payroll services, or consider connecting to trusted accounting companies or tax specialists who provide ERC submitting assistance.
Keep in mind that while these companies can provide important support, it’s always a good concept to have a basic understanding of the ERC requirements and process yourself. This will help you make notified decisions and guarantee precise filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief steps. The goal of the ERC is to encourage organizations to maintain 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 eligible companies, including for-profit companies, tax-exempt organizations, and specific governmental entities. To certify, employers should satisfy one of two requirements:.
The business operations were fully or partially suspended due to a federal government order related to COVID-19.
Business experienced a significant decline in gross invoices. As pointed out previously, for 2021, a considerable decline is defined as a 20% decrease 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 same quarter in 2019, or a 20% decrease in gross receipts compared to the instantly preceding quarter.
Credit Amount: The ERC is a refundable tax credit that offsets the employer’s share of Social Security taxes. The credit amount amounts to a portion (approximately 70%) of qualified earnings paid to workers, consisting of specific health plan expenditures. The optimum credit per staff member is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: At first, companies that got an Income Protection Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 permits companies to declare the ERC even if they got a PPP loan. However, the same wages can not be utilized to claim both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has actually been retroactively expanded and improved, enabling eligible companies to declare the credit for qualified earnings paid as far back as March 13, 2020. This retroactive provision offers a chance for companies to change prior-year tax returns and receive refunds.
Claiming the Credit: Companies can claim the ERC by reporting it on their employment tax returns, generally Kind 941. If the credit surpasses the quantity of employment taxes owed, the excess can be reimbursed to the employer.
It’s important to keep in mind that the ERC provisions and eligibility requirements have actually evolved over time. The very best strategy is to consult with a tax professional or go to the official internal revenue service website for the most comprehensive and up-to-date information relating to the ERC, including any recent legislative changes or updates.
To get approved for the ERC, a business must satisfy one of the following criteria:.
The business operations were fully or partly suspended due to a federal government order related to COVID-19.
The business experienced a significant decrease in gross invoices. For 2021, a considerable decline is specified as a 20% decrease in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a significant decrease is specified 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.
The ERC is readily available to services of all sizes, consisting of tax-exempt companies, however there are some exceptions. For instance, government entities and businesses that got a PPP loan may have restrictions on claiming the credit.
The process for claiming the ERC includes completing the necessary types and including the credit on your work tax return (typically Type 941). The exact time it takes to process the credit can differ based on several factors, consisting of the intricacy of your business and the work of the internal revenue service. It’s advised to seek advice from a tax professional for guidance particular to your scenario.
There are several companies that can aid with the process of claiming the ERC. These include accounting firms, tax advisory services, and payroll service providers. Some popular companies that offer support with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s advisable to research study and get in touch with these companies directly to inquire about their fees and services.
Please keep in mind that the info offered here is based on general knowledge and might not show the most recent updates or modifications to the ERC. It is very important to seek advice from a tax expert or check out the official IRS site for the most current and precise details relating to eligibility, declaring procedures, and readily available help.
Less than 100. The credit is based if the company had 100 or fewer workers on average in 2019.
on wages paid to all workers whether they in fact worked or not. To put it simply, 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 earnings paid to employees who did not work during the calendar quarter.
In both cases, “incomes” includes not just money payments but likewise a part of the cost of company.
provided health care. Tips Included In Employee Retention Credit
Companies can be immediately compensated for the credit by lowering the amount of payroll taxes they.