Lets talk first about Do We Qualify For Employee Retention Credit :
Our team here what do these men doing everyone in this space is assisting teach people about ERC and uh constantly supply a gorgeous breakfast and have people really find out about the program we ought to head to the space where we have the ability to display a few of the checks that we are getting for companies and I ‘d like to see that what is this this is uh numerous countless dollars actually Kevin numerous millions of dollars so these are duplicate copies of the letters that go to clients verifying that the check is on the method I suggest you know if you simply begin to look at a few of these here I imply this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I indicate it’s just I suggest think of the number of actual customers that went through the program yeah this is the very end this is the celebration at the end when the check is validated the numbers are validated and the check is on the mail in the mail from the IRS heading to the customer so that’s how you’re able to track it you understand when you
get this you understand the check is gone for sure and that’s when they pay so they do not pay anything up until they in fact receive the cash they do not pay bottom line Wonder trust anything up until this letter is confirmed the check is on the method they transfer it into their bank account and they can genuinely rely on Wonder trust that the procedure has been finished and how many you believe you’ve processed since you began this we’re about 35 000 of these for
about six billion dollars wow so clearly they understand what they’re doing and that’s what you require you need specialists 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 Terrific here you’re at my YouTube channel we’re speaking about something truly essential today the staff member retention credit which the majority of you have actually never heard of I certainly had not become aware of it up until really just recently and discovered a lot about it due to the fact that this is probably the lowest expense of capital for any small business anywhere
anytime if you have staff members in between 5 and five hundred so I’ve got the specialist with me this is Josh Fox he’s the founder and CEO of bottom line Ideas they’re the largest processor of these ERC credits this is a 170 page program so it’s challenging this isn’t like PPP we just contact your bank supervisor and say provide me a loan it does not 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 have actually ended up being yes the Ambassador and paid spokesperson for this I love this program it’s going away soon you got to learn everything about it let’s talk employee retention credit Josh Fox what is an ERC let’s simply start there so throughout the Trump Administration when President Trump was enacted they came up with the cares Act and the cares act used services 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 big distinction right there two of them are loans and one’s a refund exactly so the ERC is a refund that’s.
remedy the money money payroll tax refund alright go on sorry I just have 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 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 original cares Act is the ERC and yes Kevin it is a lovely difficult check in the mail where you get real cash from the IRS all right so let’s discuss how it works since it sounds like to me if it’s a if it’s employee retention credit that individual had to be a staff member so I’m going to make the Presumption this cash is not for the owner not for people on the cap table not for shareholders it’s for staff members right you needed to have actually owned a company but it’s based upon you having W-2 employees 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 qualified 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 correct so there were 6 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 2 and three of 2021. fine so that’s how it’s measured you have to be on the W-2 throughout that period now let’s talk my preferred part cash how much can you return per employee that was on a W-2 in those 6 quarters so the calculation in 2020 to be specific Kevin is 50 of the worker’s income to a maximum of five thousand dollars per employee for the year of 2020 and in 2021 the numbers increased to 70 of the worker’s income to an optimum of 7 thousand per quarter how did that occur um they simply altered the rules in.
2021 versus because 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 as much as five thousand Max and then what happens 21 000 Max in 2021 oh that’s how you develop twenty six 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 caution here the PPP cash would have to be decreased 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 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 workers and you took PPP money 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 learn about this since appearance when I first became aware of this when I initially satisfied Josh you know I’ve got lots of financial investments in great deals of business I’m a major supporter for entrepreneurship in America and make many lots of financial investments in entrepreneurs of which numerous suffered through the pandemic when I first became aware of this I called BS I don’t think it because I use the PPP we went through the cash center Banks to get it it was very easy to do we had our CEOs call the banks they got their loans which were well deserved and we utilized them sensibly to survive throughout 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 buddies Guv Senators they didn’t know about it I indicate that’s how you know that’s how misinformation is that there’s no information out there then a lot of people informed me well you can’t get it because you took the PPP also not true so let’s ask Josh why does nobody learn about the staff member retention credit you understand what’s interesting you’re talking about the banks Kevin since in the PPP loan procedure 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 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 chaos due to the fact that keep in mind in the original cares act you might refrain from doing both programs so if you had 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 federal government never made it clear to anybody about how to.
do this does your CFO know how to do this not actually 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 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 went into this service and bottom line my company Kevin has been in business considering that 2009 and we have actually been dealing with the federal government and the state government to recuperate money for Fortune 500 Fortune 1000 business so a great deal of our big big business customers have actually worked with bottom line to recover other government programs we have actually done sales tax and utilize tax unemployment tax work opportunity tax credits research and development tax credits unclaimed home property tax all of these other federal government programs.
The worker retention tax credit is a broad based refundable tax credit designed to motivate.
companies to keep workers on their payroll. The credit is 50% of as much as $10,000 in salaries paid by an.
Since of COVID-19 or whose gross receipts, company whose organization is fully or partly suspended.
decrease by more than 50%.
1. The credit is available to all companies despite size including tax exempt companies. There are.
just two exceptions: (1) state and city governments and their instrumentalities and (2) little.
businesses who take Small company Loans.
2. To certify, the company needs to satisfy one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the employer’s company is fully or partly suspended by government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross receipts are listed below 50% of the comparable quarter in 2019. Once the.
employer’s gross invoices go above 80% of an equivalent 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 qualifying earnings paid up to $10,000 in overall.
It is effective for wages paid after March 13th and prior to December 31, 2020.
The meaning of qualifying salaries differs by whether a company had, on average, basically than.
100 employees in 2019.
Companies that concentrate on ERC filing assistance typically offer expertise and support to help businesses browse the complicated process of declaring the credit. They can provide numerous services, consisting of:.
How is the employee retention credit calculated? Do We Qualify For Employee Retention Credit
Eligibility Evaluation: These business will evaluate your company’s eligibility for the ERC based on aspects such as your market, profits, and operations. If you meet the requirements for the credit and determine the optimum credit amount you can declare, they can assist identify.
Documents and Estimation: ERC filing services will assist in collecting the required documentation, such as payroll records and monetary statements, to support your claim. They will also help compute the credit amount based on qualified salaries and other qualifying expenses.
Retroactive Claim Review: If you are qualified to claim the ERC for previous quarters, these business can review your past payroll records and financials to recognize prospective opportunities for retroactive credits. They can assist you modify prior tax returns to claim these refunds.
Filing Help: Business concentrating on ERC filings will prepare and send the necessary kinds and documents in your place. This includes completing Type 941 or any other required tax return.
Compliance and Updates: ERC policies and guidance have actually progressed over time. These companies remain upgraded with the most recent modifications and make sure that your filings comply with the most current standards. If the IRS requests additional details or performs an audit associated to your ERC claim, they can likewise provide ongoing assistance.
It is essential to research study and vet any business using ERC filing assistance to guarantee their credibility and knowledge. Try to find established firms with experience in tax and payroll services, or consider reaching out to trusted accounting firms or tax specialists who provide ERC submitting support.
Bear in mind that while these companies can offer valuable assistance, it’s constantly an excellent concept to have a fundamental understanding of the ERC requirements and process yourself. This will assist you make informed decisions and guarantee accurate filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit presented by the U.S. government as part of COVID-19 relief measures. The goal of the ERC is to encourage organizations to retain 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 available to qualified companies, including for-profit businesses, tax-exempt organizations, and certain governmental entities. To qualify, employers must fulfill one of two requirements:.
Business operations were completely or partially suspended due to a federal government order related to COVID-19.
Business experienced a considerable decrease in gross receipts. As discussed previously, for 2021, a substantial decrease is specified as a 20% decline in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a significant decrease is specified as a 20% decrease in gross invoices compared to the exact same quarter in 2019, or a 20% decrease in gross receipts 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 amount amounts to a portion (up to 70%) of qualified salaries paid to workers, consisting of certain 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, services that got an Income Protection Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 enables services to claim the ERC even if they received a PPP loan. Nevertheless, the very same wages can not be utilized to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively expanded and boosted, permitting eligible companies to claim the credit for qualified wages paid as far back as March 13, 2020. This retroactive arrangement offers an opportunity for organizations to modify prior-year income tax return and get refunds.
Declaring the Credit: Companies can claim the ERC by reporting it on their employment income tax return, generally Kind 941. The excess can be refunded to the employer if the credit exceeds the amount of work taxes owed.
It is necessary to keep in mind that the ERC provisions and eligibility criteria have actually developed gradually. The very best strategy is to talk to a tax expert or go to the official internal revenue service website for the most current and detailed info concerning the ERC, consisting of any recent legislative changes or updates.
To qualify for the ERC, an organization must satisfy among the following requirements:.
Business operations were completely or partly suspended due to a federal government order related to COVID-19.
The business experienced a considerable decrease in gross receipts. For 2021, a substantial decline is defined as a 20% decrease in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a significant decline is specified as a 20% decline in gross invoices compared to the very same quarter in 2019, or a 20% decline in gross invoices compared to the right away preceding quarter.
The ERC is offered to services of all sizes, consisting of tax-exempt organizations, but there are some exceptions. For example, federal government entities and organizations that got a PPP loan may have limitations on declaring the credit.
The process for claiming the ERC involves finishing the required forms and including the credit on your work tax return (typically Kind 941). The exact time it requires to process the credit can vary based on a number of elements, including the complexity of your company and the work of the IRS. It’s recommended to speak with a tax professional for assistance particular to your scenario.
There are several business that can aid with the procedure of declaring the ERC. These consist of accounting firms, tax advisory services, and payroll provider. Some widely known companies that use help with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s a good idea to research and call these companies directly to inquire about their charges and services.
Please note that the info supplied here is based on general understanding and might not show the most recent updates or modifications to the ERC. It is very important to seek advice from a tax professional or go to the main internal revenue service site for the most current and accurate information regarding eligibility, declaring procedures, and readily available support.
Less than 100. If the company had 100 or less staff members on average in 2019, then the credit is based.
on incomes paid to all staff members whether they really worked or not. To put it simply, even if the.
employees worked full-time and got paid for full time work, the company still gets the credit.
Greater than 100. If the company had more than 100 workers typically in 2019, then the credit is.
permitted only for incomes paid to workers who did not work during the calendar quarter.
In both cases, “wages” consists of not just cash payments however also a portion of the expense of employer.
provided health care. Do We Qualify For Employee Retention Credit
Employers can be right away reimbursed for the credit by lowering the amount of payroll taxes they.