Lets talk first about Employee Retention Credit Is Allowed For :
Our group here what do these guys doing everyone in this room is helping teach people about ERC and uh always provide a lovely breakfast and have individuals really learn about the program we ought to head to the room where we have the ability to show a few 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 millions of dollars so these are duplicate copies of the letters that go to clients verifying that the check is on the way I suggest you know if you just begin to 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 imply 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 confirmed and the check is on the mail in the mail from the IRS heading to the client so that’s how you’re able to track it you know when you
receive this you know the check is opted for sure and that’s when they pay so they do not pay anything till they really receive the money they do not pay bottom line Wonder trust anything till this letter is validated the check is on the way they deposit it into their bank account and they can genuinely trust Wonder trust that the procedure has been completed and the number of you believe you have actually processed because you began this we have to do with 35 000 of these for
about six billion dollars wow so clearly they know what they’re doing which’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 Fantastic here you’re at my YouTube channel we’re talking about something actually important today the employee retention credit which the majority of you have actually never ever become aware of I definitely had not become aware of it till really just recently and discovered a lot about it since this is probably the most affordable expense of capital for any small business 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 biggest processor of these ERC credits this is a 170 page program so it’s difficult this isn’t like PPP we simply call up your bank manager and state offer 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 have actually ended up being yes the Ambassador and paid representative for this I love this program it’s going away soon you got to learn everything about it let’s talk staff member retention credit Josh Fox what is an ERC let’s simply begin there so throughout the Trump Administration when President Trump was enacted they developed the cares Act and the cares act used 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 big difference right there 2 of them are loans and one’s a refund exactly so the ERC is a refund that’s.
remedy the money cash payroll tax refund all right go on sorry I simply have to ensure we got that point I mean that’s a huge difference a loan versus money money I like money money that’s what we’re speaking about alright 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 lovely tough check in the mail where you get real cash from the IRS all right so let’s discuss how it works since it seems like to me if it’s a if it’s employee retention credit that individual needed to be a worker so I’m going to make the Assumption this cash is not for the owner not for individuals on the cap table not for shareholders it’s for workers right you needed to have actually owned an organization however it’s based on you having W-2 staff members 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 6 months of 2021 on the W-2 proper so there were six quarters the program was open well walk us through the six quarters so you had quarters 2 3 and 4 of 2020 and you had quarters one two and three of 2021. fine so that’s how it’s measured you need to be on the W-2 throughout that period now let’s talk my preferred part cash how much can you get back per employee that was on a W-2 in those six quarters so the calculation in 2020 to be specific Kevin is 50 of the staff member’s wage to a maximum of 5 thousand dollars per employee for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the employee’s salary to an optimum of seven thousand per quarter how did that take place um they simply changed the rules in.
2021 versus since the turmoil of the pandemic so they wanted to even get more to keep those staff members 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 come up with twenty 6 thousand twenty one thousand to twenty twenty one plus five thousand in twenty twenty that’s twenty 6 thousand dollars per staff member that is since that’s a lot of money it is now there’s a caveat here the PPP cash would need to be lowered from the twenty six thousand dollars so if you took PPP loan one and PPP loan two you would minimize the 26 000 so what we’re seeing typically Kevin is if you took PPP cash someplace around 10 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 staff members and you took PPP cash you would still get a million dollar in the mail from the IRS so it’s huge obviously now the huge question is why does no one know about this because appearance when I first heard about this when I initially satisfied Josh you understand I have actually got lots of investments in lots of business I’m a major supporter for entrepreneurship in America and make many lots of investments in business owners of which many suffered through the pandemic when I first heard about this I called BS I do not believe it since I use the PPP we went through the money center Banks to get it it was extremely easy to do we had our CEOs call the banks they got their loans which were well deserved and we used them sensibly to survive during the pandemic so when I found out about this I stated nah it can’t hold true but when I dug around I even contacted us to my politician pals Guv Senators they didn’t understand about it I mean that’s how you know that’s how false information 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 understand about the staff member retention credit you know what’s intriguing you’re discussing the banks Kevin since in the PPP loan procedure 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 country 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 turmoil since keep in mind in the initial cares act you might not do both programs so if you had actually done PPP you could not do ERC in the original program and when they changed the law in 2021 the banks were refraining from doing ERC since it’s not alone so you’re getting a tax refund so the government never ever made it clear to any person about how to.
do this does your CFO know how to do this not truly he or she’s never done it in the past do the banks do it nope the banks don’t do it the payroll business yeah some of them are doing it as a payroll business your accountant no your accountant’s never ever done this before unless you have an account that entered into this company and bottom line my firm Kevin has been in business because 2009 and we have actually been dealing with the federal government and the state federal government to recover money for Fortune 500 Fortune 1000 companies so a great deal of our huge huge business customers have actually 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 created to encourage.
companies to keep workers on their payroll. The credit is 50% of up to $10,000 in incomes paid by an.
Because of COVID-19 or whose gross receipts, employer whose business is completely or partly suspended.
decline by more than 50%.
1. The credit is offered to all employers regardless of size including tax exempt companies. There are.
just two exceptions: (1) state and city governments and their instrumentalities and (2) small.
organizations who take Small Business Loans.
2. To certify, the employer needs to meet one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the employer’s business is totally or partially suspended by government order due to COVID-19.
throughout the calendar quarter or.
o the employer’s gross invoices are below 50% of the equivalent quarter in 2019. As soon as the.
company’s gross receipts exceed 80% of a comparable 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 certifying incomes paid up to $10,000 in total.
It is effective for salaries paid after March 13th and before December 31, 2020.
The definition of certifying incomes differs by whether an employer had, usually, more or less than.
100 staff members in 2019.
Companies that concentrate on ERC filing help generally offer know-how and support to help services navigate the complex process of claiming the credit. They can provide different services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit Is Allowed For
Eligibility Assessment: These companies will assess your organization’s eligibility for the ERC based upon elements such as your market, earnings, and operations. If you satisfy the requirements for the credit and determine the optimum credit amount you can claim, they can assist figure out.
Documentation and Calculation: ERC filing services will help in collecting the essential paperwork, such as payroll records and financial declarations, to support your claim. They will also assist determine the credit amount based upon eligible wages and other qualifying costs.
Retroactive Claim Review: If you are qualified to claim the ERC for previous quarters, these companies can examine your past payroll records and financials to determine possible opportunities for retroactive credits. They can help you modify previous tax returns to declare these refunds.
Filing Support: Business focusing on ERC filings will prepare and submit the needed kinds and documents in your place. This includes finishing Kind 941 or any other required tax forms.
Compliance and Updates: ERC regulations and guidance have developed in time. These business remain upgraded with the current changes and make sure that your filings comply with the most current guidelines. They can also offer continuous support if the IRS requests additional info or conducts an audit related to your ERC claim.
It’s important to research study and veterinarian any business providing ERC filing help to ensure their trustworthiness and knowledge. Search for recognized companies with experience in tax and payroll services, or consider reaching out to trusted accounting companies or tax professionals who use ERC filing support.
Keep in mind that while these companies can offer valuable help, it’s constantly a good concept to have a basic understanding of the ERC requirements and process yourself. This will help you make informed choices 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 measures. The objective of the ERC is to encourage businesses to keep and pay their employees during the pandemic, even if their operations have actually been impacted.
Here are some key points about the ERC:.
Eligibility: The ERC is offered to qualified companies, including for-profit businesses, tax-exempt organizations, and specific governmental entities. To qualify, companies need to meet one of two requirements:.
The business operations were completely or partly suspended due to a federal government order related to COVID-19.
Business experienced a considerable decline in gross invoices. As mentioned previously, for 2021, a substantial decrease is specified as a 20% decline in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a significant decrease is defined as a 20% decline in gross invoices compared to the very same quarter in 2019, or a 20% decrease in gross receipts compared to the right away preceding quarter.
Credit Amount: 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 certified incomes paid to staff members, consisting of certain health plan expenditures. The optimum credit per employee is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: At first, businesses that got a Paycheck Defense Program (PPP) loan were not qualified for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 enables services to declare the ERC even if they received a PPP loan. Nevertheless, the same wages can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has actually been retroactively expanded and boosted, enabling qualified employers to declare the credit for certified wages paid as far back as March 13, 2020. This retroactive arrangement offers an opportunity for services 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 reimbursed to the employer if the credit goes beyond the quantity of work taxes owed.
It’s important to keep in mind that the ERC arrangements and eligibility requirements have progressed over time. The best course of action is to consult with a tax professional or go to the official IRS website for the most current and in-depth details concerning the ERC, consisting of any recent legal modifications or updates.
To get approved for the ERC, an organization should satisfy 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 considerable decline in gross receipts. For 2021, a significant decrease 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 very same quarter in 2019, or a 20% decrease in gross receipts compared to the immediately preceding quarter.
The ERC is available to organizations of all sizes, consisting of tax-exempt companies, but there are some exceptions. Government entities and companies that got a PPP loan might have limitations on declaring the credit.
The procedure for claiming the ERC involves completing the essential types and consisting of the credit on your employment tax return (usually Kind 941). The exact time it requires to process the credit can vary based upon numerous aspects, including the complexity of your business and the work of the IRS. It’s suggested to speak with 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. These consist of accounting companies, tax advisory services, and payroll company. Some popular business that provide help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s advisable to research study and call these companies straight to inquire about their services and charges.
Please note that the details supplied here is based upon general knowledge and may not show the most recent updates or changes to the ERC. It is very important to consult with a tax professional or check out the main internal revenue service website for the most accurate and up-to-date details regarding eligibility, declaring procedures, and available help.
Less than 100. The credit is based if the company had 100 or less workers on average in 2019.
on incomes paid to all workers whether they in fact worked or not. In other words, even if the.
staff members worked full time and got paid for full-time work, the employer still gets the credit.
Greater than 100. The credit is if the employer had more than 100 staff members on average in 2019.
allowed just for earnings paid to employees who did not work throughout the calendar quarter.
In both cases, “earnings” consists of not just money payments however likewise a portion of the expense of company.
offered healthcare. Employee Retention Credit Is Allowed For
Employers can be instantly repaid for the credit by decreasing the amount of payroll taxes they.