Lets talk first about Covid Relief Bill Employee Retention Credit :
Our team here what do these people doing everyone in this space is helping teach people about ERC and uh always supply a lovely breakfast and have people truly learn about the program we must head to the space where we have the ability to show a few of the checks that we are getting for companies and I want to see that what is this this is uh hundreds of millions of dollars actually Kevin hundreds of countless dollars so these are replicate copies of the letters that go to customers confirming that the check is on the way I imply you know if you simply begin to take a look at a few of these here I mean this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I imply it’s simply I imply consider how many actual clients that went through the program yeah this is the very end this is the celebration at the end when the check is verified the numbers are validated and the check is on the mail in the mail from the internal revenue service heading to the client so that’s how you’re able to track it you understand when you
receive this you know the check is chosen sure which’s when they pay so they don’t pay anything till they actually get the money they don’t pay bottom line Wonder trust anything up until this letter is confirmed the check is on the method they transfer it into their savings account and they can genuinely trust Wonder trust that the process has actually been finished and the number of you think you have actually processed since you began this we’re about 35 000 of these for
about 6 billion dollars wow so plainly they understand what they’re doing and that’s what you need you need specialists 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 Fantastic here you’re at my YouTube channel we’re discussing something really essential today the staff member retention credit which the majority of you have actually never ever become aware of I certainly hadn’t heard of it until very recently and learned a lot about it because this is probably the lowest cost of capital for any small company anywhere
anytime if you have staff members between 5 and five hundred so I’ve got the professional with me this is Josh Fox he’s the creator and CEO of bottom line Principles 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 phone 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 become yes the Ambassador and paid representative for this I like this program it’s disappearing soon you got to find out everything 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 offered companies 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 huge difference right there two of them are loans and one’s a refund precisely so the ERC is a refund that’s.
fix the cash money payroll tax refund alright go on sorry I simply need to ensure we got that point I mean that’s a big distinction a loan versus cash cash I like money money that’s what we’re talking 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 difficult check in the mail where you get real money from the IRS 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 individual had to be an employee so I’m going to make the Assumption this money is not for the owner not for people on the cap table not for investors it’s for staff members right you had to have actually owned a company but it’s based on you having W-2 staff members 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 first six months of 2021 on the W-2 appropriate so there were 6 quarters the program was open well stroll us through the 6 quarters so you had quarters two 3 and 4 of 2020 and you had quarters one two and three of 2021. all right so that’s how it’s measured you have to be on the W-2 during that duration now let’s talk my favorite part cash just how much can you return per staff member that was on a W-2 in those 6 quarters so the estimation in 2020 to be exact Kevin is 50 of the staff member’s salary to an optimum of five thousand dollars per worker for the year of 2020 and in 2021 the numbers increased to 70 of the worker’s wage to a maximum of 7 thousand per quarter how did that happen um they simply altered 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 as much as 5 thousand Max and then what occurs 21 000 Max in 2021 oh that’s how you come up with twenty 6 thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty 6 thousand dollars per employee that is because that’s a lot of money it is now there’s a caution here the PPP money would need to be lowered from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan 2 you would reduce the 26 000 so what we’re seeing usually Kevin is if you took PPP cash somewhere around 10 thousand dollars a person so let’s say hypothetically you owned a dining establishment 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 huge clearly now the big question is why does no one understand about this because appearance when I initially found out about this when I initially satisfied Josh you understand I have actually got lots of investments in lots of companies I’m a major supporter for entrepreneurship in America and make many lots of financial investments in business owners of which numerous suffered through the pandemic when I first heard about this I called BS I do not believe it because I utilize 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 and that were well deserved and we utilized them wisely to survive during the pandemic so when I heard about this I stated nah it can’t hold true however when I dug around I even contacted us to my political leader buddies Guv Senators they didn’t understand about it I suggest that’s how you know that’s how misinformation is that there’s no information out there then a bunch of individuals informed me well you can’t get it due to the fact that you took the PPP also not real so let’s ask Josh why does no one know about the worker retention credit you know what’s fascinating you’re speaking about the banks Kevin since in the PPP loan process the federal government made it very clear that if you desired 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 just procedure procedure that’s all um and here there was chaos since remember in the original cares act you could not do both programs so if you had actually done PPP you might not do ERC in the initial program and when they altered the law in 2021 the banks were not doing ERC since it’s not alone so you’re getting a tax refund so the government never made it clear to anyone about how to.
do this does your CFO know how to do this not really she or he’s never done it before do the banks do it nope the banks don’t do it the payroll companies yeah some of them are doing it as a payroll company your accountant no your accountant’s never done this before unless you have an account that entered into this service and bottom line my company Kevin has stayed in business considering that 2009 and we have actually been working with the federal government and the state federal government to recuperate cash for Fortune 500 Fortune 1000 companies so a lot of our big big corporate clients have actually dealt with bottom line to recuperate other federal government programs we’ve done sales tax and utilize tax unemployment tax work opportunity tax credits research and development tax credits unclaimed home real estate tax all of these other government programs.
The employee retention tax credit is a broad based refundable tax credit created to motivate.
companies to keep workers on their payroll. The credit is 50% of as much as $10,000 in salaries paid by an.
company whose organization is fully or partially suspended because of COVID-19 or whose gross invoices.
decrease by more than 50%.
1. The credit is readily available to all employers no matter size consisting of tax exempt companies. There are.
just 2 exceptions: (1) state and city governments and their instrumentalities and (2) little.
companies who take Small Business Loans.
2. To certify, the employer has to meet one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the employer’s company is fully or partly suspended by federal government order due to COVID-19.
during the calendar quarter or.
o the company’s gross receipts are listed below 50% of the equivalent quarter in 2019. When 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 salaries paid up to $10,000 in overall.
It is effective for salaries paid after March 13th and prior to December 31, 2020.
The meaning of certifying earnings differs by whether an employer had, usually, basically than.
100 staff members in 2019.
Business that focus on ERC filing support normally offer expertise and assistance to assist businesses navigate the complicated process of claiming the credit. They can offer different services, consisting of:.
How is the employee retention credit calculated? Covid Relief Bill Employee Retention Credit
Eligibility Evaluation: These business will evaluate your service’s eligibility for the ERC based on factors such as your market, revenue, and operations. They can help determine if you meet the requirements for the credit and determine the optimum credit amount you can declare.
Paperwork and Computation: ERC filing services will assist in collecting the required paperwork, such as payroll records and monetary declarations, to support your claim. They will likewise assist calculate the credit quantity based on eligible wages and other qualifying expenses.
Retroactive Claim Review: If you are eligible to claim the ERC for previous quarters, these companies can review your previous payroll records and financials to determine possible chances for retroactive credits. They can help you modify prior tax returns to claim these refunds.
Filing Help: Business concentrating on ERC filings will prepare and submit the needed kinds and documents in your place. This includes finishing Form 941 or any other required tax return.
Compliance and Updates: ERC policies and guidance have actually progressed gradually. These companies remain updated with the most recent modifications and guarantee that your filings comply with the most current standards. They can also provide ongoing assistance if the IRS requests extra information or performs an audit related to your ERC claim.
It is necessary to research and veterinarian any business providing ERC filing support to ensure their trustworthiness and know-how. Try to find established firms with experience in tax and payroll services, or consider connecting to trusted accounting companies or tax specialists who use ERC submitting support.
Keep in mind that while these companies can supply important assistance, it’s always an excellent concept to have a standard understanding of the ERC requirements and procedure yourself. This will help you make informed decisions and ensure accurate filings.
The Worker Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief procedures. The objective of the ERC is to encourage businesses to keep and pay their staff members throughout the pandemic, even if their operations have been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is available to eligible companies, including for-profit businesses, tax-exempt organizations, and specific governmental entities. To qualify, employers should meet one of two requirements:.
Business operations were completely or partially suspended due to a federal government order related to COVID-19.
The business experienced a substantial decrease in gross invoices. As discussed previously, for 2021, a significant decrease is defined as a 20% decline in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a significant decline is specified as a 20% decrease in gross invoices compared to the exact same quarter in 2019, or a 20% decrease in gross invoices compared to the immediately preceding quarter.
Credit Amount: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit quantity amounts to a percentage (as much as 70%) of certified incomes paid to workers, consisting of specific health insurance expenses. The optimum credit per employee is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, services that got an Income Defense Program (PPP) loan were not qualified for the ERC. However, legislation passed in late 2020 and extended in 2021 enables companies to declare the ERC even if they got a PPP loan. Nevertheless, the very same wages can not be utilized to claim both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively broadened and improved, permitting eligible companies to claim the credit for certified earnings paid as far back as March 13, 2020. This retroactive arrangement offers a chance for companies to change prior-year income tax return and receive refunds.
Declaring the Credit: Companies can claim the ERC by reporting it on their employment tax returns, usually Kind 941. If the credit surpasses the quantity of work taxes owed, the excess can be refunded to the employer.
It is essential to keep in mind that the ERC provisions and eligibility criteria have actually developed in time. The best strategy is to speak with a tax expert or check out the main internal revenue service site for the most updated and in-depth information regarding the ERC, consisting of any recent legislative modifications or updates.
To receive the ERC, a business should meet one of the following criteria:.
Business operations were completely or partially suspended due to a government order related to COVID-19.
The business experienced a significant decline in gross invoices. For 2021, a significant decline is defined as a 20% decline in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a considerable decline is defined as a 20% decline in gross invoices compared to the exact same quarter in 2019, or a 20% decrease in gross receipts compared to the immediately preceding quarter.
The ERC is available to businesses of all sizes, consisting of tax-exempt companies, however there are some exceptions. For example, federal government entities and organizations that received a PPP loan might have constraints on declaring the credit.
The process for claiming the ERC involves completing the required types and including the credit on your work tax return (typically Kind 941). The exact time it requires to process the credit can differ based upon a number of aspects, consisting of the intricacy of your business and the workload of the internal revenue service. It’s suggested to consult with a tax expert for guidance particular to your scenario.
There are several business that can help with the process of claiming the ERC. These include accounting companies, tax advisory services, and payroll provider. Some widely known business that provide assistance with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s advisable to research study and contact these companies directly to ask about their costs and services.
Please keep in mind that the info offered here is based on basic understanding and might not show the most recent updates or modifications to the ERC. It is necessary to consult with a tax expert or check out the main internal revenue service site for the most current and precise info regarding eligibility, declaring procedures, and available support.
Less than 100. The credit is based if the company had 100 or less employees on average in 2019.
on salaries paid to all staff members whether they in fact worked or not. In other words, even if the.
employees worked full time and made money for full-time work, the company still gets the credit.
Greater than 100. If the employer had more than 100 workers usually in 2019, then the credit is.
allowed only for salaries paid to employees who did not work during the calendar quarter.
In both cases, “earnings” includes not simply cash payments but likewise a part of the cost of employer.
provided healthcare. Covid Relief Bill Employee Retention Credit
Employers can be right away reimbursed for the credit by lowering the amount of payroll taxes they.