Lets talk first about Employee Retention Credit Partial Shutdown :
Our group here what do these men doing everybody in this room is assisting teach individuals about ERC and uh always offer a beautiful breakfast and have people really learn about the program we should head to the room where we are able to show some of the checks that we are getting for business and I ‘d like to see that what is this this is uh hundreds of millions of dollars literally Kevin numerous millions of dollars so these are replicate copies of the letters that go to customers validating that the check is on the method I indicate you know if you just begin 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 imply it’s just I indicate consider how many real clients 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 IRS heading to the client so that’s how you have the ability to track it you understand when you
receive this you know the check is chosen sure which’s when they pay so they don’t pay anything until they actually receive the money they do not pay bottom line Wonder trust anything until this letter is validated the check is on the way they deposit it into their bank account and they can really trust Wonder trust that the procedure has been ended up and the number of you think you’ve processed since you started this we’re about 35 000 of these for
about 6 billion dollars wow so plainly they understand what they’re doing and that’s what you require you require 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 discussing something truly crucial today the staff member retention credit which most of you have actually never become aware of I definitely hadn’t heard of it till very just recently and discovered a lot about it because this is probably the lowest cost of capital for any small business anywhere
anytime if you have workers 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 Ideas they’re the largest processor of these ERC credits this is a 170 page program so it’s difficult this isn’t like PPP we simply phone your bank supervisor and say provide me a loan it does not 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 spokesperson for this I like 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 simply start there so during the Trump Administration when President Trump was enacted they developed the cares Act and the cares act used businesses three 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 exactly so the ERC is a refund that’s.
fix the money money payroll tax refund okay go on sorry I just need to make sure we got that point I mean that’s a huge difference a loan versus money money I like cash money that’s what we’re discussing 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 gorgeous hard check in the mail where you get real cash from the IRS all right so let’s discuss how it works since it sounds 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 investors it’s for staff members right you needed to have actually owned a company but 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 first 6 months of 2021 on the W-2 correct so there were 6 quarters the program was open well stroll 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 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 staff member that was on a W-2 in those six quarters so the calculation in 2020 to be precise 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 escalated to 70 of the staff member’s salary to a maximum of seven thousand per quarter how did that happen um they simply altered the rules in.
2021 versus because the turmoil 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 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 5 thousand in twenty twenty that’s twenty 6 thousand dollars per worker that is because that’s a great deal of money it is now there’s a caution here the PPP cash would have to be reduced 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 on average Kevin is if you took PPP money somewhere around ten thousand dollars an individual so let’s say 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 money you would still get a million dollar in the mail from the internal revenue service so it’s huge certainly now the big question is why does nobody learn about this due to the fact that look when I initially became aware of this when I initially met Josh you understand I’ve got great deals of financial investments in lots of companies I’m a major supporter for entrepreneurship in America and make numerous numerous financial investments in business owners of which numerous suffered through the pandemic when I first heard about this I called BS I do not think it since I utilize the PPP we went through the money 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 should have and we utilized them sensibly to stay alive throughout the pandemic so when I found out about this I stated nah it can’t hold true however when I dug around I even called to my political leader buddies Guv Senators they didn’t understand about it I imply that’s how you understand that’s how misinformation is that there’s no information out there then a lot of individuals informed me well you can’t get it since 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 fascinating you’re discussing the banks Kevin because in the PPP loan procedure the federal government made it very 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 process 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 because 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 ever made it clear to anyone about how to.
do this does your CFO know how to do this not truly she or he’s never ever done it before 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 prior to unless you have an account that went into this service and bottom line my firm Kevin has stayed in business considering that 2009 and we’ve been working with the federal government and the state government to recover cash for Fortune 500 Fortune 1000 companies so a lot of our huge huge business clients have dealt with bottom line to recover other government programs we have actually done sales tax and utilize tax unemployment tax work chance tax credits research and development tax credits unclaimed home real estate tax all of these other government programs.
The staff member retention tax credit is a broad based refundable tax credit developed to motivate.
companies to keep workers on their payroll. The credit is 50% of approximately $10,000 in earnings paid by an.
company whose organization is fully or partially suspended because of COVID-19 or whose gross receipts.
decrease by more than 50%.
1. The credit is offered to all companies regardless of size including tax exempt organizations. There are.
just 2 exceptions: (1) state and local governments and their instrumentalities and (2) little.
companies who take Small company Loans.
2. To qualify, the employer needs to satisfy one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the company’s organization 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. When the.
company’s gross invoices exceed 80% of a comparable quarter in 2019 they no longer certify.
after the end of that quarter.
Estimation of the Credit.
The quantity of the credit is 50% of the qualifying wages paid up to $10,000 in total.
It is effective for earnings paid after March 13th and before December 31, 2020.
The meaning of certifying wages varies by whether an employer had, usually, basically than.
100 workers in 2019.
Business that focus on ERC filing support typically provide know-how and support to assist services browse the complicated procedure of declaring the credit. They can provide various services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit Partial Shutdown
Eligibility Assessment: These companies will evaluate your business’s eligibility for the ERC based upon factors such as your industry, earnings, and operations. If you meet the requirements for the credit and identify the optimum credit quantity you can claim, they can assist identify.
Documentation and Computation: ERC filing services will help in collecting the required documentation, such as payroll records and financial declarations, to support your claim. They will likewise help compute the credit amount based upon qualified salaries and other certifying expenditures.
Retroactive Claim Evaluation: If you are eligible to declare the ERC for previous quarters, these companies can review your past payroll records and financials to identify prospective chances for retroactive credits. They can help you amend prior tax returns to claim these refunds.
Filing Help: Business specializing in ERC filings will prepare and submit the required forms and documents on your behalf. This consists of finishing Form 941 or any other necessary tax return.
Compliance and Updates: ERC policies and guidance have developed over time. These business remain upgraded with the most recent changes and make sure that your filings comply with the most existing standards. They can likewise supply ongoing assistance if the internal revenue service requests additional info or conducts an audit related to your ERC claim.
It is very important to research and vet any business providing ERC filing support to guarantee their reliability and knowledge. Look for established firms with experience in tax and payroll services, or consider reaching out to trusted accounting firms or tax experts who provide ERC submitting support.
Bear in mind that while these companies can supply valuable support, it’s constantly a great idea to have a standard understanding of the ERC requirements and process yourself. This will assist you make informed choices and make sure precise filings.
The Employee Retention Credit (ERC) is a refundable tax credit presented by the U.S. government as part of COVID-19 relief measures. The goal of the ERC is to motivate organizations to maintain and pay their workers throughout the pandemic, even if their operations have actually been affected.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is available to eligible employers, consisting of for-profit organizations, tax-exempt organizations, and specific governmental entities. To qualify, companies must fulfill one of two criteria:.
The business operations were totally or partially suspended due to a government order related to COVID-19.
Business experienced a considerable decline in gross receipts. As pointed out previously, for 2021, a substantial decrease is defined as a 20% decline in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a considerable decrease is specified as a 20% decrease in gross receipts compared to the exact same quarter in 2019, or a 20% decline in gross invoices compared to the immediately preceding quarter.
Credit Amount: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit quantity amounts to a percentage (approximately 70%) of certified earnings paid to staff members, including particular health plan expenditures. The optimum credit per worker is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: At first, services that received an Income Protection Program (PPP) loan were not eligible for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 enables organizations to declare the ERC even if they received a PPP loan. The same incomes can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively expanded and boosted, allowing qualified companies to claim the credit for certified earnings paid as far back as March 13, 2020. This retroactive arrangement provides an opportunity for services to amend prior-year tax returns and receive refunds.
Declaring the Credit: Companies can declare the ERC by reporting it on their work income tax return, usually Kind 941. The excess can be reimbursed to the employer if the credit exceeds the quantity of employment taxes owed.
It is very important to note that the ERC provisions and eligibility criteria have progressed over time. The best strategy is to seek advice from a tax professional or visit the official internal revenue service site for the most in-depth and updated details concerning the ERC, consisting of any recent legislative modifications or updates.
To get approved for the ERC, a company needs to meet one of the following requirements:.
The business operations were totally or partially suspended due to a government order related to COVID-19.
Business experienced a significant decrease in gross invoices. For 2021, a substantial decline is specified as a 20% decrease in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a significant decrease is defined 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 immediately preceding quarter.
The ERC is offered to businesses of all sizes, including tax-exempt companies, however there are some exceptions. For example, government entities and services that received a PPP loan may have restrictions on claiming the credit.
The process for claiming the ERC involves finishing the necessary types and consisting of the credit on your employment tax return (usually Form 941). The exact time it requires to process the credit can vary based on several factors, including the complexity of your organization and the workload of the IRS. It’s suggested to speak with a tax professional for assistance particular to your scenario.
There are a number of business that can help with the procedure of claiming the ERC. Some popular business that use support with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the information offered here is based upon general understanding and may not reflect the most recent updates or changes to the ERC. It is very important to talk to a tax professional or visit the main internal revenue service site for the most current and accurate info regarding eligibility, claiming procedures, and offered assistance.
Less than 100. If the company had 100 or fewer staff members on average in 2019, then the credit is based.
on incomes paid to all staff members whether they in fact worked or not. To put it simply, even if the.
employees worked full-time and made money for full-time work, the company still gets the credit.
Greater than 100. If the company had more than 100 staff members on average in 2019, then the credit is.
allowed just for salaries paid to staff members who did not work during the calendar quarter.
In both cases, “earnings” consists of not just cash payments but also a portion of the cost of employer.
offered healthcare. Employee Retention Credit Partial Shutdown
Employers can be immediately compensated for the credit by lowering the quantity of payroll taxes they.