Lets talk first about Employee Retention Credit Who Qualifies :
Our group here what do these people doing everyone in this room is assisting teach people about ERC and uh always supply a gorgeous breakfast and have individuals actually learn more 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 companies and I wish to see that what is this this is uh hundreds of countless dollars actually Kevin hundreds of millions of dollars so these are replicate copies of the letters that go to clients confirming that the check is on the method I mean you know if you just 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 imply it’s just I imply think about how many actual 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 IRS 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 cash they don’t pay bottom line Wonder trust anything until this letter is verified the check is on the way they transfer it into their checking account and they can genuinely rely on Wonder trust that the procedure has been completed and how many you think you have actually processed given that you started this we’re about 35 000 of these for
about six billion dollars wow so clearly they understand what they’re doing which’s what you require you need professionals 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 Terrific here you’re at my YouTube channel we’re discussing something actually important today the staff member retention credit which most of you have never become aware of I definitely hadn’t become aware of it until very just recently and found out a lot about it due to the fact that this is most likely the most affordable cost of capital for any small business anywhere
anytime if you have workers between 5 and five hundred so I’ve got the professional with me this is Josh Fox he’s the creator and CEO of bottom line Principles they’re the largest processor of these ERC credits this is a 170 page program so it’s not easy this isn’t like PPP we simply call up your bank manager and say offer 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 become yes the Ambassador and paid representative for this I love this program it’s going away very soon you got to find out all about it let’s talk staff member retention credit Josh Fox what is an ERC let’s just begin there so during the Trump Administration when President Trump was enacted they came up with the cares Act and the cares act provided services 3 chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly everybody it makes a huge difference 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 all right go on sorry I simply need to ensure we got that point I suggest that’s a big distinction a loan versus money money I like money 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 beautiful hard check in the mail where you get actual money from the IRS all right so let’s discuss how it works since it seems like to me if it’s a if it’s staff member retention credit that individual had to be a worker 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 workers right you needed to have actually owned an organization but it’s based upon you having W-2 employees 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 eligible so you have to be on payroll in 2020 on the W-2 and you have to be on payroll for the first six months of 2021 on the W-2 right so there were 6 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 two and three of 2021. fine 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 money just how much can you get back per employee that was on a W-2 in those 6 quarters so the estimation in 2020 to be specific Kevin is 50 of the worker’s salary to an optimum of 5 thousand dollars per staff member for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the worker’s salary to an optimum of 7 thousand per quarter how did that take place um they just altered the rules in.
2021 versus because the mayhem 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 up to five thousand Max and then what occurs 21 000 Max in 2021 oh that’s how you develop 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 great deal of money it is now there’s a caution here the PPP money would need to be lowered from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan 2 you would lower the 26 000 so what we’re seeing typically Kevin is if you took PPP cash someplace around 10 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 big undoubtedly now the big concern is why does nobody know about this since appearance when I initially became aware of this when I first fulfilled Josh you understand I have actually got great deals of investments in great deals of companies I’m a significant supporter for entrepreneurship in America and make numerous numerous financial investments in entrepreneurs of which many suffered through the pandemic when I first became aware of this I called BS I don’t believe it since I utilize 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 and that were well should have and we used them carefully to stay alive during the pandemic so when I found out about this I stated nah it can’t be true but when I dug around I even contacted us to my politician good friends Governor Senators they didn’t learn about it I suggest that’s how you know that’s how false information is that there’s no information out there then a lot of people told me well you can’t get it since you took the PPP likewise not true so let’s ask Josh why does nobody know about the staff member retention credit you know what’s fascinating you’re discussing the banks Kevin since 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 country and they would process process 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 since keep in mind in the original 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 changed the law in 2021 the banks were refraining from doing ERC since it’s not alone so you’re getting a tax refund so the government never made it clear to anybody about how to.
do this does your CFO know how to do this not really he or she’s never ever done it before 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 accounting professional’s never done this prior to unless you have an account that entered into this company and bottom line my company Kevin has actually been in business considering that 2009 and we have actually been working with the federal government and the state federal government to recover cash for Fortune 500 Fortune 1000 companies so a great deal of our big 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 property real estate tax all of these other federal government programs.
The worker retention tax credit is a broad based refundable tax credit designed to motivate.
companies to keep employees on their payroll. The credit is 50% of as much as $10,000 in wages paid by an.
employer whose business is completely or partially suspended because of COVID-19 or whose gross invoices.
decrease by more than 50%.
1. The credit is readily available to all employers regardless of size including tax exempt companies. There are.
just 2 exceptions: (1) state and city governments and their instrumentalities and (2) little.
services who take Small company Loans.
2. To certify, the employer has to fulfill one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the employer’s company is totally or partly suspended by federal government order due to COVID-19.
during the calendar quarter or.
o the employer’s gross receipts are below 50% of the similar quarter in 2019. When the.
employer’s gross invoices go above 80% of a comparable quarter in 2019 they no longer certify.
after the end of that quarter.
Calculation of the Credit.
The quantity of the credit is 50% of the qualifying salaries paid up to $10,000 in total.
It works for earnings paid after March 13th and prior to December 31, 2020.
The meaning of qualifying incomes differs by whether a company had, on average, basically than.
100 staff members in 2019.
Companies that focus on ERC filing support usually offer competence and support to assist services navigate the complex process of declaring the credit. They can use different services, including:.
How is the employee retention credit calculated? Employee Retention Credit Who Qualifies
Eligibility Assessment: These companies will examine your service’s eligibility for the ERC based on elements such as your market, income, and operations. They can assist identify if you satisfy the requirements for the credit and determine the optimum credit amount you can claim.
Paperwork and Calculation: ERC filing services will help in collecting the necessary documents, such as payroll records and monetary declarations, to support your claim. They will also assist determine the credit amount based on eligible incomes and other qualifying expenses.
Retroactive Claim Review: If you are qualified to declare the ERC for previous quarters, these business can review your past payroll records and financials to recognize prospective opportunities for retroactive credits. They can assist you modify prior tax returns to declare these refunds.
Filing Assistance: Business specializing in ERC filings will prepare and send the necessary types and paperwork on your behalf. This includes completing Type 941 or any other required tax return.
Compliance and Updates: ERC regulations and assistance have evolved with time. These business remain updated with the most recent modifications and ensure that your filings abide by the most present standards. They can also supply ongoing support if the IRS demands additional information or carries out an audit related to your ERC claim.
It is necessary to research study and veterinarian any business providing ERC filing assistance to ensure their reliability and proficiency. Search for recognized firms with experience in tax and payroll services, or think about reaching out to relied on accounting firms or tax specialists who offer ERC submitting assistance.
Remember that while these companies can supply valuable assistance, 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 presented by the U.S. federal government as part of COVID-19 relief steps. The goal of the ERC is to encourage services to maintain and pay their staff members during the pandemic, even if their operations have been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is available to qualified companies, including for-profit organizations, tax-exempt organizations, and certain governmental entities. To certify, employers should satisfy 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 substantial decrease in gross receipts. As pointed out previously, for 2021, a substantial decline is defined as a 20% decrease in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a substantial decrease is specified as a 20% decrease in gross invoices compared to the exact same quarter in 2019, or a 20% decline in gross invoices compared to the instantly preceding quarter.
Credit Amount: The ERC is a refundable tax credit that offsets the employer’s share of Social Security taxes. The credit amount is equal to a portion (as much as 70%) of qualified incomes paid to employees, including specific health insurance costs. The optimum credit per staff member is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: At first, companies that received an Income Security Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 permits organizations to declare the ERC even if they received a PPP loan. However, the exact same wages can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively broadened and enhanced, enabling eligible companies to declare the credit for qualified salaries paid as far back as March 13, 2020. This retroactive arrangement supplies an opportunity for services to change prior-year income tax return and receive refunds.
Declaring the Credit: Companies can claim the ERC by reporting it on their employment income tax return, normally Type 941. If the credit exceeds the amount of work taxes owed, the excess can be refunded to the company.
It’s important to note that the ERC provisions and eligibility criteria have evolved in time. The best course of action is to talk to a tax professional or go to the official internal revenue service site for the most up-to-date and comprehensive details concerning the ERC, including any current legal changes or updates.
To get approved for the ERC, a business needs to meet among the following criteria:.
Business operations were completely or partly suspended due to a government order related to COVID-19.
The business experienced a considerable decrease in gross receipts. For 2021, a substantial decline is specified as a 20% decline in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a considerable decrease is defined as a 20% decrease in gross receipts compared to the very same quarter in 2019, or a 20% decrease in gross invoices compared to the right away preceding quarter.
The ERC is readily available to businesses of all sizes, consisting of tax-exempt companies, but there are some exceptions. For example, government entities and organizations that received a PPP loan might have limitations on declaring the credit.
The procedure for claiming the ERC involves completing the essential forms and consisting of the credit on your employment income tax return (typically Form 941). The exact time it takes to process the credit can vary based on numerous aspects, including the complexity of your service and the workload of the IRS. It’s suggested to consult with a tax professional for assistance specific to your situation.
There are several business that can assist with the process of claiming the ERC. These include accounting companies, tax advisory services, and payroll company. Some well-known business that offer support with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s advisable to research and contact these companies straight to ask about their services and fees.
Please note that the details supplied here is based upon basic understanding and may not show the most current updates or modifications to the ERC. It is very important to consult with a tax professional or check out the official IRS website for the most current and precise information concerning eligibility, declaring procedures, and offered assistance.
Less than 100. The credit is based if the employer had 100 or fewer workers on average in 2019.
on salaries paid to all employees whether they really worked or not. In other words, even if the.
staff members worked full-time and got paid for full-time work, the company still gets the credit.
Greater than 100. If the employer had more than 100 workers typically in 2019, then the credit is.
enabled just for incomes paid to staff members who did not work during the calendar quarter.
In both cases, “earnings” includes not just money payments however also a portion of the cost of employer.
supplied healthcare. Employee Retention Credit Who Qualifies
Employers can be immediately repaid for the credit by decreasing the quantity of payroll taxes they.