Lets talk first about Employee Retention Credit Government Order :
Our group here what do these men doing everybody in this space is assisting teach people about ERC and uh constantly offer a lovely breakfast and have people actually learn more about the program we need to head to the space where we have the ability to show a few of the checks that we are getting for companies and I wish to see that what is this this is uh numerous countless dollars actually Kevin hundreds of countless dollars so these are duplicate copies of the letters that go to clients confirming that the check is on the way I suggest you know if you just 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 suggest it’s simply I suggest think about how many actual clients that went through the program yeah this is the very end this is the party at the end when the check is verified the numbers are validated and the check is on the mail in the mail from the IRS heading to the consumer so that’s how you have the ability to track it you understand when you
get this you understand the check is opted for 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 until this letter is validated the check is on the method they transfer it into their checking account and they can genuinely rely on Wonder trust that the procedure has been ended up and the number of you think you have actually processed since you began this we’re about 35 000 of these for
about six billion dollars wow so plainly they understand 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 one of these that’s what matters all right Mr Wonderful here you’re at my YouTube channel we’re discussing something truly essential today the employee retention credit which most of you have actually never ever heard of I definitely had not heard of it up until extremely just recently and learned a lot about it since this is most likely the lowest expense of capital for any small company anywhere
anytime if you have staff members between 5 and five hundred so I’ve got the expert with me this is Josh Fox he’s the founder and CEO of bottom line Concepts they’re the largest 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 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 inform us all about it and how to get it and why I’ve become 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 worker retention credit Josh Fox what is an ERC let’s just begin there so during the Trump Administration when President Trump was enacted they developed the cares Act and the cares act provided companies three opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and almost everyone it makes a huge distinction right there two of them are loans and one’s a refund precisely so the ERC is a refund that’s.
correct the money cash payroll tax refund okay go on sorry I just need to ensure we got that point I indicate that’s a huge difference a loan versus cash cash I like cash money that’s what we’re talking about okay 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 stunning hard check in the mail where you get real money from the internal revenue service all right so let’s talk about how it works because it seems like to me if it’s a if it’s worker retention credit that individual had 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 needed to have actually owned an organization however it’s based on 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 first six months of 2021 on the W-2 correct so there were six quarters the program was open well walk 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. fine so that’s how it’s determined you have to be on the W-2 throughout that duration now let’s talk my preferred part cash just how much can you return per worker that was on a W-2 in those 6 quarters so the estimation in 2020 to be specific Kevin is 50 of the employee’s wage to an optimum of 5 thousand dollars per staff member for the year of 2020 and in 2021 the numbers escalated to 70 of the staff member’s income to a maximum of seven thousand per quarter how did that occur um they just changed the rules in.
2021 versus because 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 as much as 5 thousand Max and after that 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 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 need to be decreased from the twenty six thousand dollars so if you took PPP loan one and PPP loan two you would reduce the 26 000 so what we’re seeing on average Kevin is if you took PPP cash somewhere around 10 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 staff members and you took PPP cash you would still get a million dollar in the mail from the IRS so it’s big undoubtedly now the big question is why does no one understand about this because look when I first found out about this when I first fulfilled Josh you know I have actually got great deals of investments in great deals of business I’m a significant supporter for entrepreneurship in America and make numerous lots of financial investments in entrepreneurs of which lots of suffered through the pandemic when I first heard about this I called BS I don’t believe it since I utilize 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 and that were well deserved and we used them sensibly to survive 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 pals Guv Senators they didn’t learn about it I suggest that’s how you know that’s how false information is that there’s no details out there then a bunch of people told me well you can’t get it due to the fact that you took the PPP likewise not real so let’s ask Josh why does nobody learn about the employee retention credit you understand what’s interesting you’re discussing the banks Kevin due to the fact that 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 big banks in our country and they would process procedure in Canada a pre-pp loan there’s no loans in Canada by the way it’s simply process process that’s all um and here there was turmoil due to the fact that remember in the initial cares act you could not do 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 government never made it clear to anybody about how to.
do this does your CFO understand how to do this not truly 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 company your accounting professional no your accounting professional’s never ever done this before unless you have an account that entered into this service and bottom line my firm Kevin has actually been in business since 2009 and we’ve been dealing with the federal government and the state federal government to recover cash for Fortune 500 Fortune 1000 companies so a great deal of our big huge corporate customers have actually dealt with bottom line to recuperate other government programs we’ve done sales tax and utilize tax joblessness tax work chance tax credits research and development tax credits unclaimed property property tax all of these other federal government programs.
The staff member retention tax credit is a broad based refundable tax credit developed to encourage.
companies to keep workers on their payroll. The credit is 50% of approximately $10,000 in salaries paid by an.
employer whose service is fully or partially suspended because of COVID-19 or whose gross receipts.
decline by more than 50%.
1. The credit is offered to all companies despite size including tax exempt organizations. There are.
just 2 exceptions: (1) state and local governments and their instrumentalities and (2) small.
organizations who take Small Business Loans.
2. To certify, the employer needs to satisfy one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the company’s organization is completely or partially suspended by federal government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross receipts are below 50% of the comparable quarter in 2019. When the.
company’s gross receipts exceed 80% of a similar quarter in 2019 they no longer qualify.
after the end of that quarter.
Calculation of the Credit.
The quantity of the credit is 50% of the qualifying salaries paid up to $10,000 in total.
It works for earnings paid after March 13th and prior to December 31, 2020.
The definition of certifying wages differs by whether a company had, usually, basically than.
100 employees in 2019.
Companies that concentrate on ERC filing support normally offer knowledge and assistance to assist companies navigate the complicated process of declaring the credit. They can offer numerous services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit Government Order
Eligibility Evaluation: These business will assess your organization’s eligibility for the ERC based upon aspects such as your market, income, and operations. They can assist determine if you satisfy the requirements for the credit and determine the maximum credit amount you can declare.
Documents and Estimation: ERC filing services will help in gathering the required paperwork, such as payroll records and monetary statements, to support your claim. They will also help calculate the credit quantity based upon qualified incomes and other certifying costs.
Retroactive Claim Evaluation: If you are eligible to claim the ERC for previous quarters, these business can evaluate your past payroll records and financials to identify possible opportunities for retroactive credits. They can help you change previous income tax return to claim these refunds.
Filing Help: Companies specializing in ERC filings will prepare and submit the necessary types and documentation on your behalf. This includes completing Type 941 or any other necessary tax return.
Compliance and Updates: ERC regulations and guidance have developed gradually. These companies stay upgraded with the most recent changes and ensure that your filings abide by the most present standards. If the IRS requests extra details or performs an audit related to your ERC claim, they can likewise supply continuous assistance.
It is necessary to research study and vet any business offering ERC filing assistance to guarantee their credibility and competence. Search 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 filing support.
Bear in mind that while these companies can offer valuable assistance, it’s always a good concept to have a fundamental understanding of the ERC requirements and process yourself. This will assist you make informed decisions and make sure precise filings.
The Worker Retention Credit (ERC) is a refundable tax credit presented by the U.S. federal government as part of COVID-19 relief measures. The objective of the ERC is to motivate services to retain and pay their employees during the pandemic, even if their operations have been impacted.
Here are some key points about the ERC:.
Eligibility: The ERC is readily available to eligible employers, consisting of for-profit businesses, tax-exempt companies, and certain governmental entities. To certify, employers should satisfy one of two criteria:.
The business operations were totally or partially suspended due to a federal government order related to COVID-19.
Business experienced a significant decrease in gross invoices. As pointed out earlier, for 2021, a significant decline is defined as a 20% decrease in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a significant decline is defined as a 20% decrease in gross receipts compared to the exact same quarter in 2019, or a 20% decrease in gross receipts 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 amounts to a portion (approximately 70%) of qualified salaries paid to employees, including certain health insurance expenses. The optimum credit per worker is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, companies that got a Paycheck Security Program (PPP) loan were not eligible for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 enables services to claim the ERC even if they got a PPP loan. The same earnings can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively expanded and enhanced, permitting qualified companies to claim the credit for qualified salaries paid as far back as March 13, 2020. This retroactive arrangement provides a chance for services to amend prior-year tax returns and get refunds.
Claiming the Credit: Employers can claim the ERC by reporting it on their employment income tax return, generally Kind 941. If the credit surpasses the quantity of employment taxes owed, the excess can be refunded to the company.
It is essential to keep in mind that the ERC arrangements and eligibility criteria have actually evolved gradually. The very best strategy is to seek advice from a tax expert or check out the main internal revenue service site for the most in-depth and updated info relating to the ERC, consisting of any recent legislative changes or updates.
To qualify for the ERC, a business needs to meet one of the following requirements:.
Business operations were completely or partly suspended due to a government order related to COVID-19.
The business experienced a considerable decrease in gross receipts. For 2021, a significant decline is specified as a 20% decrease in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a substantial decline is specified as a 20% decline in gross invoices compared to the same quarter in 2019, or a 20% decrease in gross receipts compared to the right away preceding quarter.
The ERC is offered to companies of all sizes, including tax-exempt companies, but there are some exceptions. For instance, federal government entities and services that got a PPP loan may have limitations on declaring the credit.
The procedure for claiming the ERC involves finishing the needed forms and including the credit on your employment income tax return (normally Type 941). The exact time it requires to process the credit can differ based upon several elements, consisting of the complexity of your company and the work of the IRS. It’s advised to talk to a tax expert for assistance 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 details offered here is based on general knowledge and might not show the most recent updates or modifications to the ERC. It is essential to consult with a tax professional or check out the main internal revenue service site for the most accurate and updated information regarding eligibility, declaring treatments, and readily available help.
Less than 100. The credit is based if the employer had 100 or less staff members on average in 2019.
on wages paid to all staff members whether they really worked or not. To put it simply, even if the.
workers worked full-time and made money for full-time work, the employer still gets the credit.
Greater than 100. The credit is if the employer had more than 100 workers on average in 2019.
allowed just for salaries paid to workers who did not work throughout the calendar quarter.
In both cases, “incomes” consists of not just money payments but also a portion of the cost of employer.
provided healthcare. Employee Retention Credit Government Order
Companies can be immediately reimbursed for the credit by minimizing the amount of payroll taxes they.