Lets talk first about Employee Retention Credit Shareholder Wages :
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 individuals actually discover the program we need to head to the room where we have the ability to display some of the checks that we are getting for companies and I wish to see that what is this this is uh hundreds of countless dollars actually 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 suggest you understand if you just start 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 mean it’s simply I mean consider how many real customers that went through the program yeah this is the very end this is the party at the end when the check is validated 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 understand when you
get this you know the check is opted for sure which’s when they pay so they do not pay anything till they really get the money they don’t pay bottom line Wonder trust anything until this letter is confirmed the check is on the way they transfer 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 have actually processed because you began this we have to do with 35 000 of these for
about six 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 Wonderful here you’re at my YouTube channel we’re speaking about something actually important today the staff member retention credit which the majority of you have never ever heard of I certainly had not become aware of it till extremely recently and learned a lot about it due to the fact that this is probably the most affordable expense of capital for any small business anywhere
anytime if you have workers in 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 Concepts 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 call your bank manager and state 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’ve become yes the Ambassador and paid representative for this I love this program it’s disappearing soon you got to find out everything about it let’s talk employee 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 offered organizations 3 opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly everybody it makes a big 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 all right go on sorry I simply need to make sure we got that point I suggest that’s a big distinction a loan versus cash cash 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 initial cares Act is the ERC and yes Kevin it is a gorgeous 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 since it seems like to me if it’s a if it’s worker retention credit that individual had to be a staff member so I’m going to make the Presumption this money 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 owned a service but it’s based on you having W-2 staff members in America not 10.99. so as long as you had W-2 staff members 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 correct so there were six quarters the program was open well stroll us through the 6 quarters so you had quarters two 3 and four of 2020 and you had quarters one 2 and three of 2021. okay so that’s how it’s measured you have to be on the W-2 during that period now let’s talk my favorite part cash how much can you get back per employee that was on a W-2 in those six quarters so the estimation in 2020 to be exact Kevin is 50 of the staff member’s wage to a maximum of five thousand dollars per worker for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the worker’s income to a maximum of seven thousand per quarter how did that occur um they simply changed the rules in.
2021 versus because the mayhem 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 approximately 5 thousand Max and after that what takes place 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 worker that is because that’s a lot of money it is now there’s a caveat 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 lower the 26 000 so what we’re seeing typically Kevin is if you took PPP money somewhere around ten thousand dollars a person so let’s say hypothetically you owned a dining establishment in New York City where I’m from and you had a hundred workers and you took PPP money you would still get a million dollar in the mail from the internal revenue service so it’s substantial clearly now the big concern is why does nobody know about this due to the fact that appearance when I first became aware of this when I initially met Josh you know I have actually got lots of financial investments in great deals of business I’m a significant advocate for entrepreneurship in America and make lots of many financial investments in entrepreneurs of which numerous suffered through the pandemic when I initially heard about this I called BS I do not think it because I use the PPP we went through the cash 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 should have and we used them sensibly to survive throughout the pandemic so when I found out about this I said nah it can’t hold true but when I dug around I even contacted us to my political leader friends Guv Senators they didn’t know about it I imply that’s how you understand that’s how false information is that there’s no information out there then a lot of individuals informed me well you can’t get it because you took the PPP likewise not true so let’s ask Josh why does nobody know about the worker retention credit you know what’s intriguing you’re talking about the banks Kevin since in the PPP loan process the federal government made it extremely clear that if you wanted 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 just process process that’s all um and here there was turmoil since remember in the original cares act you could not do both programs so if you had actually done PPP you might refrain from doing ERC in the original program and when they altered the law in 2021 the banks were not 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 really he or she’s never ever done it previously do the banks do it nope the banks do not do it the payroll companies yeah some of them are doing it as a payroll business your accounting professional no your accountant’s never ever done this before unless you have an account that went into this company and bottom line my company Kevin has been in business considering that 2009 and we have actually been dealing with the federal government and the state federal government to recuperate cash for Fortune 500 Fortune 1000 companies so a lot of our huge huge business customers have dealt with bottom line to recover other federal government programs we’ve done sales tax and use tax unemployment tax work opportunity tax credits research and development tax credits unclaimed property real estate tax all of these other federal government programs.
The worker retention tax credit is a broad based refundable tax credit developed to encourage.
employers to keep staff members on their payroll. The credit is 50% of approximately $10,000 in wages paid by an.
employer whose company is fully or partially suspended because of COVID-19 or whose gross receipts.
decline by more than 50%.
1. The credit is offered to all employers regardless of size including tax exempt organizations. There are.
just two exceptions: (1) state and local governments and their instrumentalities and (2) small.
organizations who take Small company Loans.
2. To certify, the company has to meet one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the employer’s company is completely 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 comparable quarter in 2019. As soon as the.
employer’s gross invoices go above 80% of an equivalent quarter in 2019 they no longer certify.
after completion of that quarter.
Computation of the Credit.
The amount of the credit is 50% of the qualifying incomes paid up to $10,000 in total.
It works for earnings paid after March 13th and before December 31, 2020.
The definition of certifying earnings differs by whether a company had, usually, basically than.
100 staff members in 2019.
Companies that specialize in ERC filing support generally provide competence and assistance to assist services navigate the complicated process of declaring the credit. They can offer numerous services, including:.
How is the employee retention credit calculated? Employee Retention Credit Shareholder Wages
Eligibility Evaluation: These companies will examine your organization’s eligibility for the ERC based on elements such as your industry, revenue, and operations. They can assist figure out if you fulfill the requirements for the credit and recognize the optimum credit quantity you can declare.
Documents and Calculation: ERC filing services will help in gathering the necessary documentation, such as payroll records and financial declarations, to support your claim. They will also assist determine the credit quantity based on qualified incomes and other qualifying expenditures.
Retroactive Claim Evaluation: If you are qualified to claim the ERC for previous quarters, these companies can evaluate your past payroll records and financials to determine prospective chances for retroactive credits. They can help you modify prior tax returns to claim these refunds.
Filing Help: Companies focusing on ERC filings will prepare and submit the required kinds and documentation on your behalf. This includes finishing Kind 941 or any other necessary tax return.
Compliance and Updates: ERC policies and assistance have evolved in time. These business stay upgraded with the current modifications and make sure that your filings comply with the most existing standards. If the Internal revenue service demands extra information or carries out an audit associated to your ERC claim, they can also supply ongoing support.
It is necessary to research and vet any business offering ERC filing support to guarantee their reliability and expertise. Try to find established companies with experience in tax and payroll services, or consider reaching out to trusted accounting firms or tax specialists who provide ERC submitting support.
Bear in mind that while these companies can provide valuable support, it’s always a great concept to have a standard understanding of the ERC requirements and procedure yourself. This will assist you make notified decisions and ensure precise filings.
The Worker Retention Credit (ERC) is a refundable tax credit presented by the U.S. government as part of COVID-19 relief procedures. The goal of the ERC is to motivate companies to maintain and pay their workers during the pandemic, even if their operations have been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is available to eligible companies, including for-profit companies, tax-exempt organizations, and certain governmental entities. To certify, companies must fulfill one of two criteria:.
Business operations were totally or partly suspended due to a government order related to COVID-19.
Business experienced a significant decrease in gross receipts. As discussed earlier, for 2021, a significant decline is specified as a 20% decline 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 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 quantity is equal to a portion (approximately 70%) of certified incomes paid to employees, consisting of specific health insurance expenditures. The maximum credit per staff member is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, companies that got a Paycheck Security Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 permits organizations to claim the ERC even if they received a PPP loan. However, the same salaries can not be utilized to claim both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively broadened and boosted, enabling qualified companies to claim the credit for certified incomes paid as far back as March 13, 2020. This retroactive provision provides a chance for businesses to modify 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 reimbursed to the company if the credit goes beyond the quantity of work taxes owed.
It is essential to keep in mind that the ERC provisions and eligibility requirements have actually progressed over time. The very best strategy is to consult with a tax expert or check out the main internal revenue service website for the most in-depth and current information relating to the ERC, including any current legislative changes or updates.
To receive the ERC, a business needs to fulfill one of the following requirements:.
Business operations were totally or partially suspended due to a federal government order related to COVID-19.
Business experienced a significant decline in gross invoices. For 2021, a considerable decrease is specified as a 20% decline in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a considerable decline is defined as a 20% decline in gross receipts compared to the same quarter in 2019, or a 20% decline in gross receipts compared to the right away preceding quarter.
The ERC is offered to organizations of all sizes, including tax-exempt organizations, however there are some exceptions. Federal government entities and organizations that got a PPP loan may have limitations on claiming the credit.
The process for claiming the ERC includes finishing the essential kinds and consisting of the credit on your work income tax return (usually Type 941). The exact time it takes to process the credit can differ based upon a number of aspects, including the complexity of your service and the work of the IRS. It’s advised to seek advice from a tax professional for guidance particular to your situation.
There are several business that can aid with the procedure of declaring the ERC. These include accounting companies, tax advisory services, and payroll provider. Some widely known business that provide assistance with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s suggested to research and get in touch with these business straight to ask about their services and charges.
Please keep in mind that the details provided here is based on general knowledge and may not reflect the most recent updates or changes to the ERC. It is very important to talk to a tax professional or go to the main internal revenue service site for the most current and accurate info concerning eligibility, claiming procedures, and readily available assistance.
Less than 100. The credit is based if the employer had 100 or less workers on average in 2019.
on salaries paid to all workers whether they really worked or not. In other words, even if the.
staff members worked full time and made money for full time work, the employer still gets the credit.
Greater than 100. The credit is if the company had more than 100 workers on average in 2019.
enabled only for salaries paid to workers who did not work during the calendar quarter.
In both cases, “wages” consists of not simply money payments however likewise a portion of the expense of employer.
offered healthcare. Employee Retention Credit Shareholder Wages
Employers can be instantly repaid for the credit by lowering the quantity of payroll taxes they.