Lets talk first about 4Th Quarter Employee Retention Credit :
Our group here what do these people doing everyone in this room is assisting teach individuals about ERC and uh constantly provide a beautiful breakfast and have people truly learn about the program we must head to the room where we are able to display a few of the checks that we are getting for business and I wish to see that what is this this is uh hundreds of countless dollars actually Kevin numerous countless dollars so these are replicate copies of the letters that go to customers confirming that the check is on the way I mean you understand 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 mean it’s simply I indicate think of the number of real clients that went through the program yeah this is the very end this is the celebration at the end when the check is confirmed the numbers are verified and the check is on the mail in the mail from the IRS heading to the customer 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 and that’s when they pay so they don’t pay anything till they actually get the cash they do not pay bottom line Wonder trust anything till this letter is confirmed the check is on the method they deposit it into their savings account and they can genuinely rely on Wonder trust that the procedure has actually been completed and the number of you think you’ve processed because you began this we have to do with 35 000 of these for
about 6 billion dollars wow so clearly they understand what they’re doing which’s what you need you need professionals 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 Terrific here you’re at my YouTube channel we’re discussing something actually essential today the staff member retention credit which most of you have actually never ever heard of I definitely had not heard of it till extremely recently and learned a lot about it because this is most likely the lowest cost of capital for any small company anywhere
anytime if you have employees in between 5 and five hundred so I’ve got the professional with me this is Josh Fox he’s the founder and CEO of bottom line Ideas they’re the biggest processor of these ERC credits this is a 170 page program so it’s challenging this isn’t like PPP we just phone your bank supervisor 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 us all about it and how to get it and why I’ve ended up being 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 simply begin there so during the Trump Administration when President Trump was enacted they created the cares Act and the cares act offered organizations three opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically everyone 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.
correct the cash cash payroll tax refund all right go on sorry I simply need to make sure we got that point I imply that’s a huge distinction 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 initial cares Act is the ERC and yes Kevin it is a beautiful hard check in the mail where you get real 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 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 investors it’s for employees right you had to have owned a service however it’s based upon you having W-2 workers in America not 10.99. As long as you had W-2 workers 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 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 2 three and 4 of 2020 and you had quarters one two and three of 2021. all right 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 money how much can you return per staff member that was on a W-2 in those six quarters so the calculation in 2020 to be exact Kevin is 50 of the employee’s income to an optimum of 5 thousand dollars per staff member for the year of 2020 and in 2021 the numbers escalated to 70 of the worker’s salary to an optimum of seven thousand per quarter how did that take place um they just changed the rules in.
2021 versus due to the fact that the mayhem of the pandemic so they wished 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 up to five thousand Max and after that what occurs 21 000 Max in 2021 oh that’s how you create twenty six thousand twenty one thousand to twenty twenty one plus five thousand in twenty twenty that’s twenty 6 thousand dollars per worker that is since that’s a lot of money it is now there’s a caveat here the PPP money would have to be lowered from the twenty six thousand dollars so if you took PPP loan one and PPP loan 2 you would lower the 26 000 so what we’re seeing on average Kevin is if you took PPP money someplace around 10 thousand dollars an individual so let’s say 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 clearly now the big question is why does nobody learn about this due to the fact that look when I first heard about this when I initially met Josh you know I have actually got lots of financial investments in great deals of business I’m a major supporter for entrepreneurship in America and make many numerous financial investments in entrepreneurs of which many suffered through the pandemic when I first became aware of this I called BS I do not 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 during the pandemic so when I became aware of this I said nah it can’t be true but when I dug around I even called to my politician good friends Guv Senators they didn’t learn about it I mean that’s how you understand that’s how misinformation is that there’s no info out there then a bunch of people informed me well you can’t get it because you took the PPP also not real so let’s ask Josh why does nobody understand about the employee retention credit you understand what’s interesting you’re speaking 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 country and they would process procedure 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 turmoil because keep in mind in the original cares act you might not do both programs so if you had done PPP you could not do 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 government never ever made it clear to anybody about how to.
do this does your CFO understand how to do this not really he or she’s never ever done it previously 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 accountant no your accounting professional’s never ever done this before unless you have an account that entered into this organization and bottom line my company Kevin has actually stayed in business since 2009 and we’ve 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 huge huge corporate customers have worked with bottom line to recuperate other government programs we have actually done sales tax and utilize tax unemployment tax work chance 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 developed to encourage.
companies to keep employees on their payroll. The credit is 50% of up to $10,000 in incomes paid by an.
Since of COVID-19 or whose gross invoices, employer whose company is completely or partly suspended.
decline by more than 50%.
1. The credit is offered to all companies regardless of size including tax exempt companies. There are.
only two exceptions: (1) state and city governments and their instrumentalities and (2) small.
companies who take Small company Loans.
2. To qualify, the company has to satisfy one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the company’s company is fully or partially suspended by federal government order due to COVID-19.
during the calendar quarter or.
o the employer’s gross receipts are below 50% of the comparable quarter in 2019. As soon as the.
employer’s gross receipts exceed 80% of an equivalent quarter in 2019 they no longer qualify.
after completion of that quarter.
Computation of the Credit.
The amount of the credit is 50% of the certifying wages paid up to $10,000 in overall.
It works for wages paid after March 13th and prior to December 31, 2020.
The definition of qualifying salaries differs by whether a company had, typically, basically than.
100 staff members in 2019.
Companies that specialize in ERC filing assistance typically provide know-how and support to assist companies browse the complex procedure of declaring the credit. They can use various services, consisting of:.
How is the employee retention credit calculated? 4Th Quarter Employee Retention Credit
Eligibility Evaluation: These companies will evaluate your company’s eligibility for the ERC based upon aspects such as your market, income, and operations. If you meet the requirements for the credit and recognize the optimum credit amount you can declare, they can help determine.
Documents and Computation: ERC filing services will help in collecting the essential documentation, such as payroll records and monetary declarations, to support your claim. They will likewise help determine the credit quantity based on qualified salaries and other certifying costs.
Retroactive Claim Review: If you are eligible to claim the ERC for prior quarters, these companies can examine your past payroll records and financials to determine potential chances 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 send the required forms and documents in your place. This consists of completing Form 941 or any other necessary tax forms.
Compliance and Updates: ERC guidelines and assistance have progressed gradually. These business remain updated with the current changes and guarantee that your filings adhere to the most current standards. If the Internal revenue service requests additional details or conducts an audit associated to your ERC claim, they can likewise offer continuous assistance.
It’s important to research and veterinarian any business offering ERC filing assistance to ensure their reliability and know-how. Try to find recognized firms with experience in tax and payroll services, or consider connecting to relied on accounting companies or tax specialists who provide ERC submitting assistance.
Bear in mind that while these companies can provide valuable help, it’s always a good concept to have a standard understanding of the ERC requirements and process yourself. This will assist you make notified decisions and make sure 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 procedures. The objective of the ERC is to encourage businesses to keep 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 eligible companies, consisting of for-profit businesses, tax-exempt companies, and certain governmental entities. To certify, companies must satisfy one of two criteria:.
The business operations were fully or partly suspended due to a federal government order related to COVID-19.
Business experienced a substantial decline in gross invoices. As pointed out previously, for 2021, a considerable decrease is specified as a 20% decline in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a substantial decrease is defined as a 20% decline in gross invoices compared to the exact 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 earnings paid to workers, including specific health insurance expenditures. The optimum credit per worker 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 enables businesses to claim the ERC even if they got a PPP loan. However, the exact same salaries can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively broadened and enhanced, enabling eligible companies to claim the credit for certified salaries paid as far back as March 13, 2020. This retroactive arrangement offers an opportunity for services to modify prior-year tax returns and get refunds.
Declaring the Credit: Companies can declare the ERC by reporting it on their employment tax returns, typically Form 941. The excess can be reimbursed to the employer if the credit exceeds the quantity of employment taxes owed.
It is necessary to keep in mind that the ERC provisions and eligibility requirements have actually progressed in time. The very best strategy is to talk to a tax expert or visit the official internal revenue service site for the most detailed and up-to-date details regarding the ERC, consisting of any recent legislative modifications or updates.
To get approved for the ERC, a company should meet among the following requirements:.
Business operations were completely or partly suspended due to a government order related to COVID-19.
The business experienced a considerable decline in gross invoices. For 2021, a considerable decline 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% decline in gross receipts compared to the exact 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, including tax-exempt organizations, however there are some exceptions. For instance, government entities and businesses that received a PPP loan may have limitations on declaring the credit.
The procedure for claiming the ERC involves finishing the required forms and including the credit on your work tax return (typically Type 941). The exact time it takes to process the credit can vary based on several elements, consisting of the complexity of your service and the workload of the IRS. It’s recommended to consult with a tax expert for assistance particular to your situation.
There are a number of companies that can assist with the process of declaring the ERC. These include accounting companies, tax advisory services, and payroll service providers. Some well-known companies that provide assistance with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s a good idea to research study and get in touch with these companies straight to ask about their costs and services.
Please keep in mind that the info supplied here is based on general understanding and might not show the most current updates or modifications to the ERC. It is very important to speak with a tax professional or go to the official IRS site for the most up-to-date and accurate information relating to eligibility, claiming procedures, and available assistance.
Less than 100. The credit is based if the company had 100 or fewer staff members on average in 2019.
on incomes paid to all workers whether they actually 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.
allowed just for wages paid to workers who did not work throughout the calendar quarter.
In both cases, “wages” includes not just cash payments but likewise a part of the cost of company.
offered health care. 4Th Quarter Employee Retention Credit
Companies can be right away reimbursed for the credit by minimizing the quantity of payroll taxes they.