Lets talk first about Employee Retention Credit Alternative Quarter Election :
Our group here what do these people doing everyone in this room is helping teach people about ERC and uh constantly supply a lovely breakfast and have individuals truly learn more about the program we need to head to the space where we have the ability to show some of the checks that we are getting for companies and I wish to see that what is this this is uh hundreds of countless dollars actually Kevin hundreds of countless dollars so these are duplicate copies of the letters that go to customers validating that the check is on the way I imply you understand if you just start to take a 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 suggest it’s simply I imply think about how many actual customers that went through the program yeah this is the very end this is the party at the end when the check is confirmed the numbers are confirmed 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 chosen sure and that’s when they pay so they do not pay anything till they really get the money they do not pay bottom line Wonder trust anything till this letter is confirmed the check is on the method they transfer it into their bank account and they can truly trust Wonder trust that the procedure has been ended up and the number of you believe you have actually processed since you started this we’re about 35 000 of these for
about 6 billion dollars wow so plainly they know 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 Wonderful here you’re at my YouTube channel we’re talking about something truly crucial today the worker retention credit which the majority of you have actually never ever heard of I definitely hadn’t become aware of it till really recently and found out a lot about it because this is probably the lowest cost of capital for any small company anywhere
anytime if you have employees in between five 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 largest 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 say offer me a loan it does not 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 representative for this I enjoy this program it’s disappearing very soon you got to learn 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 developed the cares Act and the cares act offered services three chances 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 precisely so the ERC is a refund that’s.
remedy the cash money payroll tax refund okay go on sorry I simply have to make certain we got that point I mean that’s a big difference a loan versus cash money I like money cash that’s what we’re talking about all right 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 stunning tough check in the mail where you get actual cash from the internal revenue service all right so let’s talk about how it works since it seems like to me if it’s a if it’s worker retention credit that individual needed to be an employee so I’m going to make the Presumption this money is not for the owner not for people on the cap table not for shareholders it’s for workers right you needed to have owned a business however it’s based upon you having W-2 staff members in America not 10.99. so 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 three and 4 of 2020 and you had quarters one two and 3 of 2021. fine so that’s how it’s measured you have to be on the W-2 during that duration now let’s talk my preferred part money just how much can you get back per staff member that was on a W-2 in those six quarters so the computation in 2020 to be exact Kevin is 50 of the worker’s income to a maximum of 5 thousand dollars per employee for the year of 2020 and in 2021 the numbers escalated to 70 of the worker’s wage to a maximum of seven thousand per quarter how did that occur um they simply altered the rules in.
2021 versus since the mayhem 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 approximately 5 thousand Max and after that what takes place 21 000 Max in 2021 oh that’s how you come up with twenty six thousand twenty one thousand to twenty twenty one plus five thousand in twenty twenty that’s twenty 6 thousand dollars per employee that is since that’s a great deal of money it is now there’s a caveat here the PPP cash would need to be reduced from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan 2 you would minimize the 26 000 so what we’re seeing usually Kevin is if you took PPP money someplace around ten thousand dollars a person 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 internal revenue service so it’s big certainly now the huge concern is why does no one know 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 lots of financial investments in lots of companies I’m a significant advocate for entrepreneurship in America and make many numerous financial investments in entrepreneurs of which many suffered through the pandemic when I initially became aware of this I called BS I do not think it due to the fact that I utilize the PPP we went through the cash 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 wisely to survive during the pandemic so when I heard about this I stated nah it can’t hold true but when I dug around I even contacted us to my politician buddies Governor Senators they didn’t know about it I suggest that’s how you understand that’s how misinformation is that there’s no info out there then a bunch of individuals informed me well you can’t get it because you took the PPP likewise not real so let’s ask Josh why does nobody know about the staff member retention credit you know what’s interesting you’re discussing the banks Kevin because 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 huge 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 process procedure that’s all um and here there was mayhem due to the fact that remember in the initial cares act you could not do both programs so if you had actually done PPP you might not do 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 ever 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 done it previously do the banks do it nope the banks do not do it the payroll business yeah some of them are doing it as a payroll business your accountant no your accountant’s never done this before unless you have an account that went into this company and bottom line my firm Kevin has been in business because 2009 and we’ve been dealing with the federal government and the state government to recover cash for Fortune 500 Fortune 1000 business so a great deal of our big huge business customers have dealt with bottom line to recuperate other government programs we have actually done sales tax and utilize tax unemployment tax work opportunity tax credits research and development tax credits unclaimed property real estate tax all of these other government programs.
The worker retention tax credit is a broad based refundable tax credit designed to encourage.
employers to keep workers on their payroll. The credit is 50% of up to $10,000 in wages paid by an.
Because of COVID-19 or whose gross invoices, employer whose business is totally or partially suspended.
decline by more than 50%.
Schedule.
1. The credit is offered to all companies no matter size consisting of tax exempt companies. There are.
just 2 exceptions: (1) state and city governments and their instrumentalities and (2) small.
organizations who take Small company Loans.
2. To qualify, the employer has to satisfy one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the company’s organization is fully or partially suspended by federal government order due to COVID-19.
throughout the calendar quarter or.
o the employer’s gross invoices are below 50% of the comparable quarter in 2019. Once the.
employer’s gross invoices go above 80% of a similar quarter in 2019 they no longer qualify.
after the end of that quarter.
Calculation 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 wages varies by whether a company had, on average, more or less than.
100 staff members in 2019.
Business that specialize in ERC filing help usually provide know-how and support to help organizations navigate the intricate process of declaring the credit. They can provide numerous services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit Alternative Quarter Election
Eligibility Evaluation: These business will assess your business’s eligibility for the ERC based upon factors such as your industry, profits, and operations. If you fulfill the requirements for the credit and determine the maximum credit amount you can declare, they can help determine.
Documents and Calculation: ERC filing services will assist in collecting the necessary documents, such as payroll records and financial statements, to support your claim. They will also help determine the credit quantity based on eligible salaries and other certifying expenses.
Retroactive Claim Review: If you are eligible to claim the ERC for prior quarters, these business can examine your previous payroll records and financials to determine potential opportunities for retroactive credits. They can assist you change previous tax returns to declare these refunds.
Filing Help: Business focusing on ERC filings will prepare and submit the essential kinds and documents in your place. This includes completing Type 941 or any other required tax return.
Compliance and Updates: ERC regulations and guidance have actually progressed with time. These companies remain updated with the latest changes and guarantee that your filings abide by the most present standards. They can also provide continuous assistance if the IRS demands extra details or carries out an audit related to your ERC claim.
It’s important to research and veterinarian any company offering ERC filing support to guarantee their credibility and proficiency. Try to find established firms with experience in tax and payroll services, or consider connecting to trusted accounting companies or tax experts who offer ERC submitting support.
Remember that while these business can provide valuable assistance, it’s constantly a great idea to have a basic understanding of the ERC requirements and procedure yourself. This will assist you make informed 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 steps. The goal of the ERC is to motivate companies to keep and pay their employees throughout the pandemic, even if their operations have been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is offered to qualified employers, including for-profit organizations, tax-exempt organizations, and specific governmental entities. To qualify, employers need to meet one of two criteria:.
Business operations were fully or partially suspended due to a federal government order related to COVID-19.
The business experienced a significant decrease in gross receipts. As discussed earlier, for 2021, a considerable decrease is defined as a 20% decrease in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a considerable decline is specified as a 20% decline in gross receipts compared to the same quarter in 2019, or a 20% decline in gross invoices 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 is equal to a portion (as much as 70%) of qualified earnings paid to employees, including specific health insurance 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 a Paycheck Protection Program (PPP) loan were not qualified 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. However, the same wages can not be utilized 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 qualified wages paid as far back as March 13, 2020. This retroactive provision supplies an opportunity for companies to modify prior-year tax returns and receive refunds.
Declaring the Credit: Employers can declare the ERC by reporting it on their employment tax returns, generally Kind 941. If the credit surpasses the quantity of work taxes owed, the excess can be reimbursed to the employer.
It is necessary to keep in mind that the ERC arrangements and eligibility requirements have actually evolved with time. The best course of action is to seek advice from a tax expert or check out the main IRS website for the most current and in-depth details relating to the ERC, consisting of any recent legislative changes or updates.
To receive the ERC, a business must fulfill one of the following requirements:.
Business operations were completely or partly suspended due to a federal government order related to COVID-19.
The business experienced a significant decline in gross receipts. For 2021, a significant decline is specified as a 20% decrease in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a significant decline is defined as a 20% decrease in gross invoices compared to the same quarter in 2019, or a 20% decrease in gross invoices compared to the immediately preceding quarter.
The ERC is available to companies of all sizes, consisting of tax-exempt companies, however there are some exceptions. For example, federal government entities and companies that got a PPP loan might have constraints on declaring the credit.
The process for declaring the ERC involves completing the needed kinds and including the credit on your employment tax return (generally Form 941). The exact time it requires to process the credit can vary based upon numerous factors, including the intricacy of your business and the workload of the IRS. It’s suggested to consult with a tax expert for assistance specific to your scenario.
There are several business that can assist with the procedure of claiming the ERC. These include accounting companies, tax advisory services, and payroll service providers. Some widely known companies that offer support with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s advisable to research study and get in touch with these business straight to ask about their fees and services.
Please keep in mind that the details supplied here is based on basic understanding and may not reflect the most current updates or modifications to the ERC. It’s important to consult with a tax professional or visit the official IRS site for the most precise and updated information concerning eligibility, claiming treatments, and available help.
Less than 100. If the company had 100 or less staff members typically in 2019, then the credit is based.
on salaries paid to all employees whether they in fact worked or not. Simply put, even if the.
workers worked full time and got paid for full-time work, the company still gets the credit.
Greater than 100. The credit is if the employer had more than 100 workers on average in 2019.
permitted only for earnings paid to workers who did not work during the calendar quarter.
In both cases, “earnings” consists of not just money payments however likewise a part of the cost of company.
supplied healthcare. Employee Retention Credit Alternative Quarter Election
Payment.
Companies can be instantly reimbursed for the credit by reducing the amount of payroll taxes they.