Lets talk first about Employee Retention Credit Quickbooks Desktop :
Our group here what do these men doing everybody in this room is assisting teach individuals about ERC and uh always offer a stunning breakfast and have people really discover the program we need to head to the space where we are able 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 hundreds of millions of dollars actually Kevin numerous countless dollars so these are duplicate copies of the letters that go to clients confirming that the check is on the method I indicate you understand if you simply begin to look at some of these here I mean this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I mean it’s simply I suggest think about how many real clients that went through the program yeah this is the very end this is the party at the end when the check is confirmed the numbers are confirmed and the check is on the mail in the mail from the IRS heading to the customer so that’s how you’re able to track it you understand when you
receive this you understand the check is opted for sure which’s when they pay so they don’t pay anything till they actually get the cash they do not pay bottom line Wonder trust anything up until 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 procedure has been finished and the number of you believe you’ve processed given that you started this we have to do with 35 000 of these for
about six billion dollars wow so plainly 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 Fantastic here you’re at my YouTube channel we’re discussing something truly important today the staff member retention credit which most of you have never heard of I definitely had not heard of it till very recently and found out a lot about it due to the fact that this is most likely the lowest cost of capital for any small company anywhere
anytime if you have staff members between five and five hundred so I have actually got the specialist with me this is Josh Fox he’s the creator and CEO of bottom line Principles they’re the biggest 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 manager and state provide me a loan it doesn’t work there’s not a loan it’s an application and Josh is going to inform all of us 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 going away very soon you got to find out everything about it let’s talk worker retention credit Josh Fox what is an ERC let’s just begin there so throughout the Trump Administration when President Trump was enacted they created the cares Act and the cares act provided companies three chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and almost everybody it makes a big distinction right there two of them are loans and one’s a refund precisely so the ERC is a refund that’s.
fix the money cash payroll tax refund all right go on sorry I just have to make certain we got that point I imply that’s a big difference a loan versus money money I like money 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 real cash from the IRS all right so let’s speak about how it works due to the fact that it seems like to me if it’s a if it’s staff member retention credit that person needed to be an employee so I’m going to make the Assumption this money is not for the owner not for people on the cap table not for investors it’s for staff members right you had to have owned a business but it’s based upon you having W-2 workers in America not 10.99. so as long as you had W-2 workers 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 need to be on payroll for the first six months of 2021 on the W-2 appropriate so there were 6 quarters the program was open well walk us through the six quarters so you had quarters two three and four of 2020 and you had quarters one 2 and three of 2021. okay so that’s how it’s measured you need to be on the W-2 during that duration now let’s talk my preferred part cash just how much can you get back per employee that was on a W-2 in those 6 quarters so the calculation in 2020 to be specific Kevin is 50 of the worker’s income 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 employee’s wage to an optimum of 7 thousand per quarter how did that occur 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 staff members on payroll 100 so if you can get 5 000 per person Max in twenty that was 50 in 2020 up to 5 thousand Max and then what occurs 21 000 Max in 2021 oh that’s how you come up with twenty six 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 because that’s a great deal of cash it is now there’s a caution here the PPP cash would have to be decreased from the twenty six thousand dollars so if you took PPP loan one and PPP loan 2 you would lower the 26 000 so what we’re seeing usually Kevin is if you took PPP money someplace around 10 thousand dollars an individual so let’s say hypothetically you owned a restaurant in New York 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 big certainly now the huge concern is why does nobody learn about this since look when I initially became aware of this when I first satisfied Josh you know I have actually got great deals of investments in lots of companies I’m a major advocate for entrepreneurship in America and make lots of numerous investments in entrepreneurs of which lots of suffered through the pandemic when I first heard about this I called BS I don’t think it because I use the PPP we went through the cash 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 used them carefully to stay alive during the pandemic so when I found out about this I said nah it can’t be true but when I dug around I even contacted us to my political leader buddies Governor Senators they didn’t understand about it I suggest that’s how you know that’s how misinformation is that there’s no details out there then a lot of people informed me well you can’t get it because you took the PPP also not true so let’s ask Josh why does nobody understand about the employee retention credit you understand what’s fascinating you’re speaking about the banks Kevin because in the PPP loan process 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 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 mayhem because remember in the original cares act you could refrain from doing 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 federal government never ever made it clear to anybody about how to.
do this does your CFO understand how to do this not truly he or she’s never 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 company your accountant no your accountant’s never ever done this prior to unless you have an account that went into this service and bottom line my company Kevin has been in business since 2009 and we have actually been dealing with the federal government and the state federal government to recover cash for Fortune 500 Fortune 1000 business so a lot of our huge huge corporate customers have worked with bottom line to recover other government programs we have actually 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 employee retention tax credit is a broad based refundable tax credit designed to motivate.
employers to keep employees on their payroll. The credit is 50% of approximately $10,000 in salaries paid by an.
company whose service is totally or partly suspended because of COVID-19 or whose gross invoices.
decrease by more than 50%.
1. The credit is available to all companies despite size including tax exempt organizations. There are.
only 2 exceptions: (1) state and city governments and their instrumentalities and (2) little.
services who take Small company Loans.
2. To qualify, the employer needs to satisfy one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the employer’s service is fully or partially suspended by 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.
employer’s gross receipts go above 80% of an equivalent quarter in 2019 they no longer qualify.
after completion of that quarter.
Calculation of the Credit.
The quantity of the credit is 50% of the qualifying incomes paid up to $10,000 in total.
It works for salaries paid after March 13th and prior to December 31, 2020.
The meaning of qualifying earnings varies by whether an employer had, on average, more or less than.
100 staff members in 2019.
Companies that focus on ERC filing help generally offer knowledge and assistance to help services browse the complicated process of claiming the credit. They can offer various services, including:.
How is the employee retention credit calculated? Employee Retention Credit Quickbooks Desktop
Eligibility Evaluation: These business will assess your service’s eligibility for the ERC based on elements such as your industry, earnings, and operations. They can help determine if you satisfy the requirements for the credit and identify the optimum credit quantity you can claim.
Documents and Calculation: ERC filing services will assist in collecting the needed documents, such as payroll records and monetary statements, to support your claim. They will likewise assist calculate the credit amount based on eligible wages and other qualifying expenses.
Retroactive Claim Review: If you are eligible to declare the ERC for prior quarters, these business can evaluate your past payroll records and financials to identify potential opportunities for retroactive credits. They can assist you change prior tax returns to claim these refunds.
Filing Support: Business concentrating on ERC filings will prepare and submit the necessary types and documents in your place. This includes finishing Kind 941 or any other necessary tax return.
Compliance and Updates: ERC guidelines and guidance have actually evolved with time. These companies remain upgraded with the latest changes and make sure that your filings abide by the most present guidelines. They can likewise supply ongoing support if the internal revenue service requests additional details or carries out an audit related to your ERC claim.
It is necessary to research study and vet any business offering ERC filing support to guarantee their credibility and competence. Search for recognized firms with experience in tax and payroll services, or think about connecting to trusted accounting firms or tax professionals who provide ERC filing assistance.
Bear in mind that while these companies can supply valuable help, it’s constantly a great concept to have a standard understanding of the ERC requirements and procedure yourself. This will help you make notified choices and ensure precise filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief steps. The objective of the ERC is to encourage services to keep and pay their staff members throughout the pandemic, even if their operations have actually been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is offered to eligible employers, consisting of for-profit companies, tax-exempt companies, and particular governmental entities. To qualify, employers need to fulfill one of two criteria:.
The business operations were fully or partly suspended due to a federal government order related to COVID-19.
The business experienced a significant decline in gross receipts. As discussed earlier, for 2021, a significant decrease is defined as a 20% decrease in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a considerable decrease is specified as a 20% decline 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 company’s share of Social Security taxes. The credit amount amounts to a percentage (up to 70%) of qualified incomes paid to employees, consisting of certain health insurance expenses. The optimum credit per employee is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, services that received an Income Defense Program (PPP) loan were not eligible for the ERC. However, legislation passed in late 2020 and extended in 2021 permits businesses to declare the ERC even if they received a PPP loan. Nevertheless, the same salaries can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively expanded and improved, permitting eligible companies to declare the credit for qualified incomes paid as far back as March 13, 2020. This retroactive provision supplies a chance for businesses to amend prior-year tax returns and receive refunds.
Declaring the Credit: Employers can declare the ERC by reporting it on their employment income tax return, typically Kind 941. The excess can be refunded to the company if the credit surpasses the quantity of work taxes owed.
It is essential to keep in mind that the ERC arrangements and eligibility criteria have actually developed in time. The best strategy is to talk to a tax professional or go to the main IRS site for the most detailed and up-to-date details regarding the ERC, including any recent legal modifications or updates.
To get approved for the ERC, a company needs to satisfy among the following requirements:.
The business operations were totally or partially suspended due to a government order related to COVID-19.
Business experienced a significant decline in gross receipts. For 2021, a substantial decline is specified as a 20% decline in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a considerable decline is specified as a 20% decline in gross receipts compared to the same quarter in 2019, or a 20% decline in gross invoices compared to the right away preceding quarter.
The ERC is readily available to companies of all sizes, consisting of tax-exempt organizations, however there are some exceptions. For example, government entities and organizations that received a PPP loan might have restrictions on declaring the credit.
The procedure for claiming the ERC involves finishing the essential forms and including the credit on your work tax return (normally Type 941). The exact time it requires to process the credit can vary based on several aspects, consisting of the complexity of your company and the workload of the IRS. It’s suggested to consult with a tax professional for assistance specific to your situation.
There are numerous companies that can assist with the procedure of claiming the ERC. These consist of accounting firms, tax advisory services, and payroll company. Some popular companies that use support with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s advisable to research and get in touch with these business directly to inquire about their services and costs.
Please keep in mind that the information provided here is based on basic knowledge and may not reflect the most recent updates or changes to the ERC. It’s important to consult with a tax expert or go to the main internal revenue service site for the most accurate and current details relating to eligibility, claiming treatments, and offered assistance.
Less than 100. If the employer had 100 or fewer staff members usually in 2019, then the credit is based.
on salaries paid to all employees whether they in fact worked or not. Simply put, even if the.
employees worked full-time and earned money 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.
enabled just for salaries paid to employees who did not work throughout the calendar quarter.
In both cases, “earnings” includes not simply money payments but also a portion of the expense of company.
provided healthcare. Employee Retention Credit Quickbooks Desktop
Companies can be instantly compensated for the credit by reducing the quantity of payroll taxes they.