Lets talk first about Employee Retention Credit Program Cares Act :
Our team here what do these men doing everybody in this room is helping teach people about ERC and uh always supply a gorgeous breakfast and have individuals actually find out about the program we should head to the room where we have the ability 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 millions of dollars literally Kevin numerous millions of dollars so these are duplicate copies of the letters that go to clients confirming that the check is on the method I mean you understand if you just begin to look at a few of these here I suggest this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I mean it’s just I suggest consider the number of real customers that went through the program yeah this is the very end this is the celebration at the end when the check is validated the numbers are confirmed and the check is on the mail in the mail from the internal revenue service heading to the client so that’s how you have the ability to track it you know when you
get this you know the check is chosen sure and that’s when they pay so they don’t pay anything until they in fact get the money they don’t pay bottom line Wonder trust anything till this letter is confirmed the check is on the way they deposit it into their savings account and they can genuinely trust Wonder trust that the process has actually been ended up and how many you think you’ve processed since you started this we have to do with 35 000 of these for
about 6 billion dollars wow so clearly they know 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 Wonderful here you’re at my YouTube channel we’re talking about something truly essential today the staff member retention credit which the majority of you have actually never ever become aware of I certainly hadn’t heard of it till really recently and learned a lot about it due to the fact that this is most likely the most affordable expense of capital for any small business anywhere
anytime if you have employees between 5 and five hundred so I’ve got the specialist 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 just call up your bank supervisor and state give 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’ve ended up being yes the Ambassador and paid spokesperson for this I enjoy this program it’s disappearing very soon you got to learn everything 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 came up with 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 nearly everyone it makes a huge distinction right there 2 of them are loans and one’s a refund precisely 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 imply that’s a big difference a loan versus money cash I like cash cash that’s what we’re talking about all right 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 beautiful 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 seems like to me if it’s a if it’s worker retention credit that person 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 a service but it’s based on you having W-2 workers 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 6 months of 2021 on the W-2 correct so there were 6 quarters the program was open well walk us through the six quarters so you had quarters two three and 4 of 2020 and you had quarters one two and 3 of 2021. okay so that’s how it’s determined you need to be on the W-2 throughout that period now let’s talk my favorite part money just how much can you return per worker that was on a W-2 in those 6 quarters so the computation in 2020 to be exact Kevin is 50 of the worker’s income to an optimum of five thousand dollars per employee for the year of 2020 and in 2021 the numbers escalated to 70 of the staff member’s income to an optimum of seven thousand per quarter how did that happen um they simply changed the rules in.
2021 versus since the chaos 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 come up with twenty six thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty six thousand dollars per worker that is since that’s a lot of money 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 2 you would reduce the 26 000 so what we’re seeing on average Kevin is if you took PPP cash somewhere around ten thousand dollars an individual so let’s state hypothetically you owned a dining establishment in New york city City where I’m from and you had a hundred workers and you took PPP cash you would still get a million dollar in the mail from the internal revenue service so it’s substantial undoubtedly now the big concern is why does no one know about this since appearance when I first heard about this when I first met Josh you understand I’ve got great deals of financial investments in great deals of business I’m a significant advocate for entrepreneurship in America and make numerous many financial investments in entrepreneurs of which lots of suffered through the pandemic when I initially heard about this I called BS I don’t think it due to the fact that 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 deserved and we utilized them carefully to survive during the pandemic so when I became aware of this I stated nah it can’t hold true however when I dug around I even contacted us to my political leader good friends Guv Senators they didn’t learn about it I mean that’s how you know that’s how misinformation is that there’s no information out there then a bunch of individuals told me well you can’t get it since you took the PPP also not true so let’s ask Josh why does nobody learn about the employee retention credit you understand what’s intriguing 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 huge banks in our nation and they would process procedure 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 chaos because keep in mind in the initial cares act you could refrain from doing both programs so if you had done PPP you could refrain from doing ERC in the initial 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 anybody about how to.
do this does your CFO know how to do this not actually he or she’s never ever done it in the past 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 accountant no your accountant’s never done this before unless you have an account that went into this service and bottom line my company Kevin has stayed in business since 2009 and we have actually been working with the federal government and the state federal government to recuperate cash for Fortune 500 Fortune 1000 companies so a lot of our big big corporate customers have actually dealt with bottom line to recuperate other government programs we’ve done sales tax and use tax joblessness tax work chance tax credits research and development tax credits unclaimed home property tax all of these other government programs.
The worker retention tax credit is a broad based refundable tax credit developed to encourage.
employers 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, company whose business is fully or partially suspended.
decrease by more than 50%.
Availability.
1. The credit is readily available to all employers despite size including tax exempt organizations. There are.
just two exceptions: (1) state and city governments and their instrumentalities and (2) little.
companies who take Small Business Loans.
2. To qualify, the company needs to satisfy one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the company’s company is completely or partly suspended by government order due to COVID-19.
during the calendar quarter or.
o the company’s gross invoices are below 50% of the similar quarter in 2019. When the.
company’s gross receipts exceed 80% of an equivalent quarter in 2019 they no longer qualify.
after the end of that quarter.
Estimation of the Credit.
The amount of the credit is 50% of the qualifying wages paid up to $10,000 in overall.
It is effective for incomes paid after March 13th and before December 31, 2020.
The meaning of qualifying incomes differs by whether a company had, usually, basically than.
100 employees in 2019.
Companies that concentrate on ERC filing assistance typically provide competence and support to help businesses 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 Program Cares Act
Eligibility Assessment: These business will assess your company’s eligibility for the ERC based on factors such as your industry, revenue, and operations. If you meet the requirements for the credit and determine the maximum credit quantity you can declare, they can help identify.
Paperwork and Estimation: ERC filing services will assist in collecting the required documents, such as payroll records and monetary declarations, to support your claim. They will also help compute the credit quantity based upon qualified incomes and other certifying expenditures.
Retroactive Claim Evaluation: If you are eligible to claim the ERC for prior quarters, these business can evaluate your past payroll records and financials to identify possible chances for retroactive credits. They can assist you amend prior tax returns to claim these refunds.
Filing Support: Companies specializing in ERC filings will prepare and send the necessary kinds and documents on your behalf. This includes finishing Kind 941 or any other required tax forms.
Compliance and Updates: ERC policies and assistance have evolved with time. These companies stay updated with the most recent changes and guarantee that your filings abide by the most current guidelines. They can likewise supply continuous assistance if the IRS requests additional info or performs an audit related to your ERC claim.
It’s important to research study and veterinarian any company using ERC filing support to guarantee their trustworthiness and competence. Search for established firms with experience in tax and payroll services, or think about reaching out to trusted accounting firms or tax professionals who provide ERC submitting assistance.
Bear in mind that while these companies can supply important assistance, it’s always an excellent concept to have a basic understanding of the ERC requirements and procedure yourself. This will assist you make notified decisions and guarantee 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 goal of the ERC is to motivate organizations to maintain and pay their employees during 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, including for-profit businesses, tax-exempt organizations, and particular governmental entities. To certify, companies should fulfill one of two criteria:.
Business operations were completely or partially suspended due to a federal government order related to COVID-19.
Business experienced a substantial decline in gross invoices. As discussed previously, for 2021, a significant decline is specified as a 20% decrease in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a significant decrease is defined as a 20% decline in gross receipts compared to the very same quarter in 2019, or a 20% decline in gross invoices compared to the instantly preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit quantity is equal to a portion (as much as 70%) of certified salaries paid to workers, including specific health insurance costs. 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, services that got an Income Security Program (PPP) loan were not qualified for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 enables organizations to declare the ERC even if they got 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 been retroactively broadened and boosted, permitting qualified employers to declare the credit for qualified incomes paid as far back as March 13, 2020. This retroactive arrangement provides an opportunity for organizations to modify prior-year tax returns and receive refunds.
Claiming the Credit: Companies can declare the ERC by reporting it on their work tax returns, generally Type 941. If the credit exceeds the quantity of work taxes owed, the excess can be refunded to the employer.
It is necessary to note that the ERC provisions and eligibility requirements have progressed over time. The very best course of action is to talk to a tax professional or visit the official IRS site for the most updated and in-depth details relating to the ERC, consisting of any current legislative modifications or updates.
To qualify for the ERC, a company must satisfy among the following requirements:.
Business operations were fully or partially suspended due to a government order related to COVID-19.
Business experienced a substantial decline in gross receipts. For 2021, a significant decrease is defined as a 20% decrease in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a significant decrease is specified as a 20% decrease in gross invoices compared to the very same quarter in 2019, or a 20% decrease in gross invoices compared to the immediately preceding quarter.
The ERC is offered to organizations of all sizes, consisting of tax-exempt organizations, however there are some exceptions. For example, government entities and companies that received a PPP loan may have restrictions on declaring the credit.
The process for declaring the ERC includes completing the essential types and including the credit on your employment tax return (usually Kind 941). The exact time it requires to process the credit can vary based upon a number of aspects, consisting of the complexity of your business and the workload of the IRS. It’s recommended to talk to a tax professional for guidance specific to your situation.
There are several companies that can assist with the procedure of declaring the ERC. Some popular business that use help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the info provided here is based on general understanding and might not reflect the most current updates or modifications to the ERC. It is necessary to seek advice from a tax expert or go to the official internal revenue service website for the most accurate and updated details regarding eligibility, claiming procedures, and available support.
Less than 100. The credit is based if the company had 100 or fewer workers on average in 2019.
on earnings paid to all workers whether they in fact worked or not. In other words, even if the.
employees worked full time and got paid for full-time work, the company still gets the credit.
Greater than 100. If the company had more than 100 workers typically in 2019, then the credit is.
permitted just for incomes paid to workers who did not work during the calendar quarter.
In both cases, “salaries” includes not just cash payments but also a portion of the expense of company.
provided health care. Employee Retention Credit Program Cares Act
Payment.
Companies can be instantly compensated for the credit by minimizing the amount of payroll taxes they.