Lets talk first about Covid Relief Employee Retention Credit :
Our group here what do these guys doing everyone in this space is assisting teach people about ERC and uh always provide a gorgeous breakfast and have people truly find out about the program we should head to the space where we have the ability to show some of the checks that we are getting for companies and I ‘d like 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 clients confirming that the check is on the way I mean you know if you simply 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 indicate it’s simply I imply 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 client so that’s how you’re able to track it you understand when you
receive this you understand the check is gone for sure which’s when they pay so they do not pay anything until they really receive the cash they don’t pay bottom line Wonder trust anything up until this letter is confirmed the check is on the way they transfer it into their bank account and they can truly trust Wonder trust that the procedure has actually been completed and how many you believe you have actually processed given that you started this we’re about 35 000 of these for
about six billion dollars wow so plainly they know what they’re doing which’s what you need you require 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 Wonderful here you’re at my YouTube channel we’re talking about something really important today the worker retention credit which the majority of you have actually never ever become aware of I definitely had not become aware of it till extremely just recently and discovered a lot about it since this is most likely the most affordable cost of capital for any small business anywhere
anytime if you have employees in between five and five hundred so I’ve got the expert with me this is Josh Fox he’s the creator and CEO of bottom line Ideas they’re the biggest processor of these ERC credits this is a 170 page program so it’s not easy this isn’t like PPP we simply phone your bank supervisor and state give me a loan it doesn’t 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 spokesperson for this I enjoy this program it’s disappearing soon you got to learn all about it let’s talk employee retention credit Josh Fox what is an ERC let’s just begin there so during the Trump Administration when President Trump was enacted they came up with 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 nearly everybody it makes a huge distinction right there 2 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 okay go on sorry I simply have to make certain we got that point I suggest that’s a big distinction a loan versus money money I like money cash 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 gorgeous hard check in the mail where you get actual cash 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 staff member retention credit that individual needed to be an employee so I’m going to make the Presumption this cash 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 an organization however 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 eligible 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 walk us through the 6 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 return per worker that was on a W-2 in those six quarters so the estimation in 2020 to be exact Kevin is 50 of the staff member’s salary to an optimum of 5 thousand dollars per employee for the year of 2020 and in 2021 the numbers escalated to 70 of the staff member’s income to an optimum of 7 thousand per quarter how did that happen um they simply changed the rules in.
2021 versus because the chaos 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 as much as 5 thousand Max and after that what happens 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 employee that is because that’s a lot of money it is now there’s a caveat here the PPP cash would have to be reduced from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan two you would minimize the 26 000 so what we’re seeing usually Kevin is if you took PPP money somewhere around ten thousand dollars a person so let’s say 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 money 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 learn about this due to the fact that appearance when I first became aware of this when I first met Josh you understand I have actually got great deals of financial investments in great deals of business I’m a major supporter for entrepreneurship in America and make many many investments in business owners of which numerous suffered through the pandemic when I first heard about this I called BS I do not think it because 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 and that were well deserved and we utilized them wisely to stay alive throughout the pandemic so when I became aware of this I said nah it can’t be true however when I dug around I even called to my political leader friends Guv Senators they didn’t know about it I suggest that’s how you understand that’s how false information is that there’s no details out there then a lot of individuals informed 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 understand about the worker retention credit you understand what’s fascinating you’re speaking about the banks Kevin due to the fact that in the PPP loan process the federal government made it really clear that if you desired a PPP loan you would call Wells Fargo Citibank Bank of America any of the big banks in our nation and they would process process 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 original cares act you could refrain from doing both programs so if you had actually done PPP you could not do ERC in the initial program and when they changed 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 ever made it clear to any person about how to.
do this does your CFO know how to do this not really he or she’s never done it before do the banks do it nope the banks don’t do it the payroll business yeah a few of them are doing it as a payroll company your accountant no your accountant’s never ever done this before unless you have an account that entered into this business and bottom line my company Kevin has been in business considering that 2009 and we have actually been working with the federal government and the state government to recover money for Fortune 500 Fortune 1000 companies so a great deal of our big big business clients have actually worked with bottom line to recuperate other government programs we have actually done sales tax and use tax unemployment tax work opportunity tax credits research and development tax credits unclaimed property real estate tax all of these other government programs.
The employee 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 company is totally or partly suspended because of COVID-19 or whose gross invoices.
decline by more than 50%.
1. The credit is available to all employers despite size consisting of tax exempt organizations. There are.
only two exceptions: (1) state and city governments and their instrumentalities and (2) little.
businesses who take Small Business Loans.
2. To certify, the employer has to fulfill one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the company’s company is fully or partly suspended by federal government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross invoices are listed below 50% of the equivalent quarter in 2019. Once the.
company’s gross receipts exceed 80% of a similar quarter in 2019 they no longer qualify.
after the end of that quarter.
Computation of the Credit.
The quantity of the credit is 50% of the qualifying incomes paid up to $10,000 in total.
It is effective for wages paid after March 13th and prior to December 31, 2020.
The definition of certifying earnings differs by whether an employer had, typically, more or less than.
100 workers in 2019.
Companies that focus on ERC filing assistance typically provide know-how and assistance to help companies navigate the complex process of declaring the credit. They can offer different services, consisting of:.
How is the employee retention credit calculated? Covid Relief Employee Retention Credit
Eligibility Evaluation: These business will assess your service’s eligibility for the ERC based upon factors such as your market, revenue, and operations. If you meet the requirements for the credit and identify the optimum credit amount you can claim, they can help identify.
Paperwork and Computation: ERC filing services will help in gathering the essential paperwork, such as payroll records and financial declarations, to support your claim. They will likewise help compute the credit quantity based on eligible salaries and other qualifying expenditures.
Retroactive Claim Evaluation: If you are eligible to declare the ERC for previous quarters, these business can examine your previous payroll records and financials to determine prospective chances for retroactive credits. They can help you modify prior tax returns to declare these refunds.
Filing Support: Business specializing in ERC filings will prepare and submit the needed types and documentation on your behalf. This consists of completing Kind 941 or any other required tax forms.
Compliance and Updates: ERC guidelines and assistance have developed in time. These business remain updated with the most recent changes and make sure that your filings adhere to the most existing standards. If the IRS demands extra information or conducts an audit associated to your ERC claim, they can likewise provide ongoing support.
It is essential to research and vet any company using ERC filing support to guarantee their credibility and knowledge. Try to find recognized firms with experience in tax and payroll services, or think about connecting to relied on accounting firms or tax professionals who provide ERC submitting assistance.
Bear in mind that while these companies can provide valuable support, it’s always a great concept to have a standard 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 presented by the U.S. federal government as part of COVID-19 relief procedures. The objective of the ERC is to encourage services 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 readily available to qualified employers, including for-profit organizations, tax-exempt companies, and specific governmental entities. To qualify, companies must satisfy one of two criteria:.
Business operations were fully or partially suspended due to a government order related to COVID-19.
The business experienced a considerable decline in gross invoices. As mentioned earlier, for 2021, a considerable decrease is specified as a 20% decline in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a substantial decrease is defined as a 20% decline in gross receipts compared to the same quarter in 2019, or a 20% decrease in gross invoices compared to the immediately preceding quarter.
Credit Quantity: 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 wages paid to staff members, including specific 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: Initially, businesses that received an Income Security Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 allows businesses to declare the ERC even if they received a PPP loan. The exact same incomes can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively expanded and boosted, enabling eligible companies to claim the credit for certified salaries paid as far back as March 13, 2020. This retroactive provision supplies an opportunity for businesses to change prior-year tax returns and receive refunds.
Claiming the Credit: Employers can declare the ERC by reporting it on their work income tax return, usually Form 941. If the credit goes beyond the quantity of work taxes owed, the excess can be refunded to the employer.
It is essential to note that the ERC arrangements and eligibility criteria have actually developed over time. The best strategy is to consult with a tax expert or go to the main internal revenue service website for the most up-to-date and in-depth info concerning the ERC, including any current legislative modifications or updates.
To receive the ERC, a company needs to fulfill one of the following requirements:.
Business operations were completely or partially suspended due to a federal government order related to COVID-19.
The business experienced a significant decline in gross receipts. For 2021, a considerable decrease is defined as a 20% decline in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a considerable decrease 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.
The ERC is available to companies of all sizes, consisting of tax-exempt companies, however there are some exceptions. Federal government entities and companies that got a PPP loan might have limitations on declaring the credit.
The process for declaring the ERC includes completing the essential types and including the credit on your work income tax return (typically Form 941). The exact time it takes to process the credit can differ based on numerous factors, consisting of the complexity of your service and the workload of the IRS. It’s recommended to speak with a tax professional for guidance particular to your scenario.
There are a number of companies that can assist with the process of claiming the ERC. Some well-known business that provide help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the info offered here is based upon basic knowledge and might not show the most current updates or modifications to the ERC. It is necessary to consult with a tax professional or go to the main internal revenue service site for the most up-to-date and accurate information regarding eligibility, declaring treatments, and offered assistance.
Less than 100. The credit is based if the employer had 100 or fewer workers on average in 2019.
on earnings paid to all workers whether they really worked or not. Simply put, even if the.
employees worked full-time and got paid for full time work, the employer still gets the credit.
Greater than 100. If the company had more than 100 staff members typically in 2019, then the credit is.
permitted only for wages paid to workers who did not work throughout the calendar quarter.
In both cases, “wages” includes not simply cash payments however likewise a part of the expense of company.
provided healthcare. Covid Relief Employee Retention Credit
Employers can be instantly reimbursed for the credit by reducing the amount of payroll taxes they.