Lets talk first about Employee Retention Credit Owner Wages :
Our group here what do these men doing everybody in this room is helping teach individuals about ERC and uh constantly supply a stunning breakfast and have people truly learn about the program we ought to head to the room where we have the ability to show some of the checks that we are getting for business and I wish to see that what is this this is uh hundreds of countless dollars literally Kevin hundreds of countless dollars so these are duplicate copies of the letters that go to customers verifying that the check is on the way I imply you understand if you just begin to look at a few of these here I mean this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I indicate it’s just I indicate 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 verified the numbers are confirmed and the check is on the mail in the mail from the internal revenue service heading to the consumer so that’s how you have the ability to track it you know when you
get this you know the check is opted for sure and that’s when they pay so they don’t pay anything up until they in fact receive the money they don’t pay bottom line Wonder trust anything until this letter is verified the check is on the way they deposit it into their savings account and they can really rely on Wonder trust that the procedure has been completed and the number of you believe you have actually processed considering that you began this we have to do with 35 000 of these for
about six billion dollars wow so clearly they understand what they’re doing which’s what you need you need experts 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 speaking about something truly crucial today the staff member retention credit which most of you have actually never become aware of I certainly had not heard of it until very just recently and learned a lot about it since this is probably the most affordable cost of capital for any small business anywhere
anytime if you have workers in 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 Ideas they’re the biggest 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 state give me a loan it doesn’t 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 become yes the Ambassador and paid spokesperson for this I love this program it’s disappearing very soon you got to learn all about it let’s talk staff member retention credit Josh Fox what is an ERC let’s just start there so during the Trump Administration when President Trump was enacted they created the cares Act and the cares act provided organizations 3 chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically everyone it makes a huge difference 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 fine go on sorry I just have to make certain we got that point I mean that’s a big distinction a loan versus money money I like cash cash 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 original cares Act is the ERC and yes Kevin it is a beautiful hard check in the mail where you get actual cash from the internal revenue service all right so let’s discuss how it works because it seems like to me if it’s a if it’s worker retention credit that person had to be a worker 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 employees right you needed to have actually owned a service however it’s based on 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 need 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 right so there were six quarters the program was open well stroll us through the 6 quarters so you had quarters two 3 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 money just how much can you get back per worker that was on a W-2 in those six quarters so the calculation in 2020 to be exact Kevin is 50 of the staff member’s wage to a maximum of five thousand dollars per staff member for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the staff member’s income to a maximum of 7 thousand per quarter how did that occur um they simply changed the rules in.
2021 versus because the turmoil of the pandemic so they wanted 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 then what happens 21 000 Max in 2021 oh that’s how you develop twenty 6 thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty 6 thousand dollars per staff member that is because that’s a great deal of money it is now there’s a caution here the PPP money would have to be reduced from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan 2 you would decrease the 26 000 so what we’re seeing typically Kevin is if you took PPP cash somewhere around 10 thousand dollars a person so let’s say 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 internal revenue service so it’s big certainly now the big question is why does no one learn about this because look when I first became aware of this when I initially met Josh you know I’ve got lots of financial investments in lots of companies I’m a significant advocate for entrepreneurship in America and make many lots of financial investments in business owners of which numerous suffered through the pandemic when I initially became aware of this I called BS I don’t think it due to the fact that 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 carefully to stay alive 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 political leader good friends Governor Senators they didn’t know about it I mean that’s how you understand that’s how false information is that there’s no info out there then a lot of people told me well you can’t get it due to the fact that you took the PPP also not true so let’s ask Josh why does nobody understand about the worker retention credit you understand what’s interesting you’re discussing the banks Kevin because 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 country and they would process procedure in Canada a pre-pp loan there’s no loans in Canada by the way it’s just process process that’s all um and here there was chaos since keep in mind in the initial cares act you might not do both programs so if you had actually done PPP you could refrain from doing ERC in the original program and when they altered the law in 2021 the banks were not doing ERC because it’s not alone so you’re getting a tax refund so the federal government never ever made it clear to anyone about how to.
do this does your CFO understand how to do this not really he or she’s never ever done it in the past do the banks do it nope the banks don’t do it the payroll companies yeah a few of them are doing it as a payroll company your accounting professional no your accountant’s never done this before unless you have an account that went into this organization and bottom line my company Kevin has actually stayed in business because 2009 and we have actually been dealing with the federal government and the state government to recuperate money for Fortune 500 Fortune 1000 companies so a lot of our huge big corporate clients have worked with bottom line to recover other government programs we’ve done sales tax and use tax unemployment tax work chance tax credits research and development tax credits unclaimed home real estate tax all of these other federal government programs.
The employee retention tax credit is a broad based refundable tax credit developed to encourage.
companies to keep staff members on their payroll. The credit is 50% of up to $10,000 in salaries paid by an.
company whose service is totally or partially suspended because of COVID-19 or whose gross receipts.
decrease by more than 50%.
1. The credit is available to all employers no matter size consisting of tax exempt organizations. There are.
only 2 exceptions: (1) state and local governments and their instrumentalities and (2) little.
businesses who take Small company Loans.
2. To certify, the company needs to fulfill one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the company’s business is completely or partially suspended by federal government order due to COVID-19.
during 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 invoices go above 80% of a comparable quarter in 2019 they no longer certify.
after the end of that quarter.
Computation of the Credit.
The quantity of the credit is 50% of the certifying salaries paid up to $10,000 in overall.
It works for earnings paid after March 13th and before December 31, 2020.
The meaning of qualifying wages varies by whether an employer had, usually, more or less than.
100 workers in 2019.
Business that specialize in ERC filing assistance typically offer expertise and support to assist businesses navigate the complex procedure of claiming the credit. They can provide different services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit Owner Wages
Eligibility Assessment: These business will assess your service’s eligibility for the ERC based on factors such as your market, income, and operations. If you satisfy the requirements for the credit and identify the maximum credit amount you can claim, they can assist figure out.
Documents and Estimation: ERC filing services will assist in gathering the necessary paperwork, such as payroll records and monetary declarations, to support your claim. They will also assist compute the credit amount based upon qualified salaries and other certifying expenses.
Retroactive Claim Review: If you are eligible to claim the ERC for previous quarters, these business can review your past payroll records and financials to determine possible opportunities for retroactive credits. They can help you change previous income tax return to declare these refunds.
Filing Help: Business specializing in ERC filings will prepare and submit the required kinds and documents in your place. This includes finishing Kind 941 or any other required tax forms.
Compliance and Updates: ERC policies and assistance have actually developed in time. These companies stay updated with the most recent modifications and make sure that your filings adhere to the most existing standards. If the IRS requests additional info or carries out an audit associated to your ERC claim, they can likewise supply continuous support.
It’s important to research and vet any company offering ERC filing assistance to guarantee their credibility and proficiency. Try to find recognized companies with experience in tax and payroll services, or think about connecting to relied on accounting firms or tax professionals who offer ERC submitting assistance.
Keep in mind that while these business can offer valuable assistance, it’s always an excellent concept to have a fundamental understanding of the ERC requirements and process yourself. This will help you make notified 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 procedures. The objective of the ERC is to encourage businesses to keep and pay their workers 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 companies, consisting of for-profit businesses, tax-exempt organizations, and particular governmental entities. To qualify, employers should satisfy one of two requirements:.
The business operations were completely or partially suspended due to a federal government order related to COVID-19.
Business experienced a significant decrease in gross receipts. As mentioned earlier, for 2021, a considerable decline is specified as a 20% decrease in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a substantial decline is defined as a 20% decrease in gross invoices compared to the exact same quarter in 2019, or a 20% decrease in gross invoices 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 is equal to a portion (up to 70%) of qualified salaries paid to workers, including specific health plan expenditures. The maximum credit per worker is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: At first, businesses that received a Paycheck Protection Program (PPP) loan were not qualified for the ERC. However, legislation passed in late 2020 and extended in 2021 permits businesses to declare the ERC even if they got a PPP loan. However, the same wages can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively expanded and enhanced, enabling qualified employers to claim the credit for certified wages paid as far back as March 13, 2020. This retroactive arrangement provides an opportunity for companies to change prior-year tax returns and receive refunds.
Claiming the Credit: Companies can declare the ERC by reporting it on their work tax returns, usually Form 941. The excess can be refunded to the employer if the credit surpasses the amount of employment taxes owed.
It’s important to note that the ERC arrangements and eligibility requirements have actually developed in time. The best course of action is to seek advice from a tax professional or visit the main IRS site for the most in-depth and updated details concerning the ERC, consisting of any current legislative modifications or updates.
To receive the ERC, an organization needs to satisfy one of the following criteria:.
Business operations were completely or partly suspended due to a federal government order related to COVID-19.
The business experienced a substantial decline in gross invoices. For 2021, a significant decline is specified as a 20% decline in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a substantial decrease 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 instantly preceding quarter.
The ERC is readily available to businesses of all sizes, consisting of tax-exempt organizations, however there are some exceptions. Federal government entities and organizations that got a PPP loan may have limitations on declaring the credit.
The procedure for declaring the ERC includes completing the necessary kinds and consisting of the credit on your employment income tax return (normally Form 941). The exact time it requires to process the credit can vary based upon several aspects, consisting of the intricacy of your service and the workload of the internal revenue service. It’s recommended to talk to a tax professional for assistance particular to your situation.
There are numerous business that can assist with the process of declaring the ERC. These consist of accounting firms, tax advisory services, and payroll service providers. Some well-known business that provide help with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s suggested to research study and get in touch with these companies directly to inquire about their services and costs.
Please note that the details offered here is based on general understanding and might not reflect the most recent updates or modifications to the ERC. It is essential to consult with a tax professional or visit the official internal revenue service site for the most accurate and updated information concerning eligibility, claiming procedures, and readily available support.
Less than 100. The credit is based if the company had 100 or less staff members on average in 2019.
on earnings paid to all workers whether they in fact worked or not. To put it simply, even if the.
employees worked full-time and earned money for full-time work, the employer still gets the credit.
Greater than 100. If the company had more than 100 staff members on average in 2019, then the credit is.
enabled only for earnings paid to workers who did not work during the calendar quarter.
In both cases, “earnings” consists of not simply money payments but also a portion of the cost of company.
supplied health care. Employee Retention Credit Owner Wages
Employers can be right away compensated for the credit by minimizing the amount of payroll taxes they.