Lets talk first about Employee Retention Credit Fourth Quarter :
Our team here what do these guys doing everybody in this space is assisting teach people about ERC and uh always supply a lovely breakfast and have individuals really learn more about the program we must head to the room where we are able to show some of the checks that we are getting for companies and I wish to see that what is this this is uh numerous countless dollars literally Kevin hundreds of countless dollars so these are duplicate copies of the letters that go to customers validating that the check is on the method I imply you understand if you simply begin to look at some of these here I indicate this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I mean it’s just I mean think of the number of real clients 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 verified and the check is on the mail in the mail from the internal revenue service heading to the consumer so that’s how you’re able to track it you understand when you
get this you know the check is opted for sure which’s when they pay so they do not pay anything till they in fact get the cash they do not pay bottom line Wonder trust anything until this letter is verified the check is on the way they transfer it into their checking account and they can really rely on Wonder trust that the process has been ended up and the number of you believe you’ve processed considering that you started this we’re about 35 000 of these for
about 6 billion dollars wow so clearly they know what they’re doing which’s what you require you need experts 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 speaking about something really crucial today the employee retention credit which most of you have actually never become aware of I definitely hadn’t become aware of it till extremely recently and discovered a lot about it since this is probably the most affordable cost of capital for any small business anywhere
anytime if you have staff members 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 Concepts 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 simply call your bank supervisor and say give 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’ve ended up being yes the Ambassador and paid spokesperson for this I enjoy this program it’s disappearing very 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 begin there so during the Trump Administration when President Trump was enacted they created the cares Act and the cares act provided companies 3 chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and almost everyone it makes a huge difference right there two of them are loans and one’s a refund exactly so the ERC is a refund that’s.
remedy the cash money payroll tax refund fine go on sorry I just need to make certain we got that point I suggest that’s a big difference a loan versus cash money I like cash cash that’s what we’re speaking 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 original cares Act is the ERC and yes Kevin it is a stunning difficult check in the mail where you get actual money from the internal revenue service all right so let’s talk about how it works due to the fact that it sounds like to me if it’s a if it’s worker retention credit that person had to be a staff member so I’m going to make the Presumption this money is not for the owner not for individuals on the cap table not for investors it’s for employees right you needed to have actually owned a service however it’s based on you having W-2 employees in America not 10.99. so as long as you had W-2 workers and you paid federal payroll taxes that’s why you would be eligible so you need 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 correct so there were six quarters the program was open well stroll us through the six quarters so you had quarters two 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 need 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 employee that was on a W-2 in those 6 quarters so the calculation in 2020 to be specific Kevin is 50 of the staff member’s salary to a maximum of five thousand dollars per worker for the year of 2020 and in 2021 the numbers increased to 70 of the staff member’s salary to an optimum of 7 thousand per quarter how did that take place um they just altered the rules in.
2021 versus since 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 approximately five thousand Max and then what happens 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 six thousand dollars per employee that is because that’s a lot of money 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 minimize the 26 000 so what we’re seeing typically Kevin is if you took PPP money somewhere around ten thousand dollars a person so let’s state hypothetically you owned a restaurant in New york city City where I’m from and you had a hundred employees and you took PPP cash you would still get a million dollar in the mail from the IRS so it’s huge certainly now the huge question is why does no one learn about this because appearance when I first found out about this when I first met Josh you know I have actually got lots of investments in lots of companies I’m a major supporter for entrepreneurship in America and make lots of many investments in entrepreneurs of which lots of suffered through the pandemic when I first heard about this I called BS I do not think it due to the fact that I utilize the PPP we went through the money 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 been worthy of and we used them carefully to survive during the pandemic so when I found out about this I stated nah it can’t be true however when I dug around I even called to my politician pals Governor Senators they didn’t learn about it I imply 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 due to the fact that you took the PPP also not real so let’s ask Josh why does nobody understand about the worker retention credit you understand what’s fascinating you’re talking about the banks Kevin due to the fact that in the PPP loan procedure the federal government made it extremely clear that if you wanted 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 procedure that’s all um and here there was turmoil due to the fact that remember in the initial cares act you might refrain from doing both programs so if you had actually done PPP you might refrain from doing ERC in the initial program and when they altered the law in 2021 the banks were refraining from doing ERC because 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 understand how to do this not actually she or he’s never done it before do the banks do it nope the banks do not do it the payroll companies yeah a few of them are doing it as a payroll business your accountant no your accounting professional’s never ever done this before unless you have an account that went into this service and bottom line my firm Kevin has stayed in business since 2009 and we have actually been dealing with the federal government and the state federal government to recuperate money for Fortune 500 Fortune 1000 companies so a lot of our big big business customers have actually dealt with bottom line to recuperate other federal government programs we have actually done sales tax and use tax joblessness tax work chance tax credits research and development tax credits unclaimed home real estate tax all of these other federal government programs.
The worker 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 approximately $10,000 in earnings paid by an.
employer whose organization is completely or partially suspended because of COVID-19 or whose gross receipts.
decline by more than 50%.
1. The credit is readily available to all companies despite size consisting of tax exempt companies. There are.
just 2 exceptions: (1) state and local governments and their instrumentalities and (2) small.
services who take Small company Loans.
2. To qualify, the company needs to fulfill one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the company’s service is fully or partly suspended by government order due to COVID-19.
during the calendar quarter or.
o the company’s gross receipts are listed below 50% of the similar quarter in 2019. Once the.
company’s gross receipts go above 80% of an equivalent quarter in 2019 they no longer certify.
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 is effective for salaries paid after March 13th and prior to December 31, 2020.
The definition of qualifying incomes varies by whether a company had, on average, basically than.
100 workers in 2019.
Business that specialize in ERC filing assistance typically supply proficiency and assistance to assist services browse the intricate process of declaring the credit. They can offer different services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit Fourth Quarter
Eligibility Assessment: These business will examine your service’s eligibility for the ERC based upon aspects such as your market, revenue, and operations. If you satisfy the requirements for the credit and recognize the maximum credit quantity you can declare, they can assist identify.
Documentation and Computation: ERC filing services will help in collecting the essential paperwork, such as payroll records and financial statements, to support your claim. They will likewise help calculate the credit amount based upon eligible salaries and other qualifying costs.
Retroactive Claim Review: If you are eligible to claim the ERC for previous quarters, these companies can evaluate your past payroll records and financials to recognize possible opportunities for retroactive credits. They can help you modify prior income tax return to declare these refunds.
Filing Assistance: Companies concentrating on ERC filings will prepare and send the required kinds and paperwork in your place. This includes completing Form 941 or any other required tax forms.
Compliance and Updates: ERC policies and assistance have progressed over time. These companies remain updated with the most recent changes and ensure that your filings comply with the most existing guidelines. If the Internal revenue service demands extra details or conducts an audit related to your ERC claim, they can likewise supply continuous support.
It’s important to research and vet any business using ERC filing assistance to guarantee their trustworthiness and know-how. Look for established companies with experience in tax and payroll services, or think about reaching out to relied on accounting companies or tax professionals who offer ERC submitting support.
Keep in mind that while these companies can offer valuable support, it’s constantly an excellent concept to have a basic understanding of the ERC requirements and procedure yourself. This will help you make informed decisions and make sure accurate filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief steps. The goal of the ERC is to encourage companies to retain and pay their workers during the pandemic, even if their operations have actually been affected.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is readily available to qualified companies, including for-profit businesses, tax-exempt companies, and particular governmental entities. To certify, companies must satisfy one of two criteria:.
Business operations were totally or partly suspended due to a federal government order related to COVID-19.
The business experienced a significant decrease in gross invoices. As discussed previously, for 2021, a substantial decline is specified 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% decrease in gross receipts compared to the very same quarter in 2019, or a 20% decrease in gross receipts 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 percentage (approximately 70%) of certified wages paid to workers, including specific health plan expenditures. The maximum credit per staff member is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, services that received a Paycheck Protection Program (PPP) loan were not eligible for the ERC. However, legislation passed in late 2020 and extended in 2021 allows businesses to claim the ERC even if they got a PPP loan. Nevertheless, the same incomes can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has actually been retroactively broadened and enhanced, permitting qualified companies to claim the credit for qualified incomes paid as far back as March 13, 2020. This retroactive provision provides a chance for businesses to amend prior-year tax returns and receive refunds.
Claiming the Credit: Employers can declare the ERC by reporting it on their work tax returns, generally Kind 941. The excess can be refunded to the company if the credit goes beyond the quantity of employment taxes owed.
It is essential to note that the ERC arrangements and eligibility requirements have actually evolved over time. The best course of action is to speak with a tax expert or go to the official internal revenue service site for the most comprehensive and current details relating to the ERC, including any current legislative modifications or updates.
To qualify for the ERC, a company must satisfy one of the following requirements:.
The business operations were totally or partially suspended due to a federal government order related to COVID-19.
Business experienced a significant decline in gross invoices. For 2021, a considerable decrease is specified as a 20% decrease in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a considerable decline is defined as a 20% decrease in gross invoices compared to the very same quarter in 2019, or a 20% decrease in gross receipts compared to the instantly preceding quarter.
The ERC is readily available to services of all sizes, including tax-exempt organizations, but there are some exceptions. Government entities and organizations that received a PPP loan may have constraints on declaring the credit.
The process for declaring the ERC includes finishing the required forms and consisting of the credit on your employment income tax return (typically Form 941). The exact time it takes to process the credit can vary based on numerous factors, including the intricacy of your service and the workload of the IRS. It’s advised to talk to a tax professional for assistance specific to your scenario.
There are a number of business that can assist with the procedure of claiming the ERC. Some popular business that offer assistance with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the information supplied here is based on general knowledge and might not show the most recent updates or modifications to the ERC. It is necessary to talk to a tax expert or go to the main internal revenue service website for the most current and accurate details concerning eligibility, declaring treatments, and readily available help.
Less than 100. The credit is based if the employer had 100 or fewer workers on average in 2019.
on incomes paid to all workers whether they in fact worked or not. In other words, 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 employees on average in 2019.
enabled only for earnings paid to workers who did not work throughout the calendar quarter.
In both cases, “wages” consists of not just cash payments however also a part of the cost of company.
supplied health care. Employee Retention Credit Fourth Quarter
Companies can be immediately repaid for the credit by lowering the quantity of payroll taxes they.