Lets talk first about Essential Business Employee Retention Credit :
Our group here what do these people doing everybody in this space is assisting teach people about ERC and uh constantly offer a gorgeous breakfast and have individuals really discover the program we need to head to the space where we have the ability to display some of the checks that we are getting for companies 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 duplicate copies of the letters that go to clients validating that the check is on the method I mean you know if you just begin to take a look at some 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 simply 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 confirmed the numbers are validated and the check is on the mail in the mail from the internal revenue service heading to the client so that’s how you’re able to track it you know when you
receive this you understand the check is chosen sure and that’s when they pay so they don’t pay anything up until they actually receive the cash they don’t pay bottom line Wonder trust anything up until this letter is verified the check is on the way they deposit it into their savings account and they can really trust Wonder trust that the procedure has been completed and the number of you think you have actually processed considering that you began this we’re about 35 000 of these for
about 6 billion dollars wow so clearly they understand what they’re doing and that’s what you need 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 truly essential today the staff member retention credit which most of you have actually never become aware of I certainly had not become aware of it till really recently and discovered a lot about it because this is most likely the lowest expense of capital for any small business anywhere
anytime if you have employees between 5 and five hundred so I’ve got the professional 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 hard this isn’t like PPP we just contact your bank supervisor and state give me a loan it doesn’t work there’s not a loan it’s an application and Josh is going to tell all of us about it and how to get it and why I have actually ended up being yes the Ambassador and paid representative for this I love this program it’s going away soon you got to find out everything about it let’s talk worker retention credit Josh Fox what is an ERC let’s just start there so throughout 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 almost everybody it makes a huge difference 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 okay go on sorry I just need to ensure we got that point I mean that’s a big distinction a loan versus cash money I like cash cash that’s what we’re talking about fine 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 tough check in the mail where you get actual money from the internal revenue service all right so let’s talk about how it works because it seems like to me if it’s a if it’s worker retention credit that person needed 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 an organization however it’s based upon you having W-2 employees 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 eligible so you have to be on payroll in 2020 on the W-2 and you need to be on payroll for the very first 6 months of 2021 on the W-2 appropriate so there were 6 quarters the program was open well stroll us through the 6 quarters so you had quarters two three and four of 2020 and you had quarters one 2 and three of 2021. all right so that’s how it’s determined you have to be on the W-2 throughout that period now let’s talk my favorite part money just how much can you get back per employee that was on a W-2 in those 6 quarters so the computation in 2020 to be precise Kevin is 50 of the worker’s income to an optimum of 5 thousand dollars per employee for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the staff member’s salary to an optimum of 7 thousand per quarter how did that happen um they simply altered the rules in.
2021 versus since the turmoil of the pandemic so they wished 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 happens 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 six thousand dollars per staff member that is since that’s a lot of cash it is now there’s a caveat here the PPP cash would have to be lowered from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan 2 you would reduce 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 cash you would still get a million dollar in the mail from the internal revenue service so it’s big clearly now the big concern is why does no one understand about this because look when I initially found out about this when I first fulfilled Josh you know I’ve got lots of financial investments in great deals of business I’m a significant advocate for entrepreneurship in America and make many lots of investments in business owners of which many suffered through the pandemic when I first found out about this I called BS I don’t believe it since I utilize the PPP we went through the money 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 been worthy of and we used them carefully to survive during the pandemic so when I heard about this I said nah it can’t be true but when I dug around I even contacted us to my political leader friends Governor Senators they didn’t learn about it I suggest that’s how you understand that’s how misinformation is that there’s no info out there then a lot of individuals 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 staff member retention credit you know what’s intriguing you’re speaking about the banks Kevin because in the PPP loan procedure the federal government made it extremely 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 procedure in Canada a pre-pp loan there’s no loans in Canada by the way it’s simply process procedure that’s all um and here there was chaos since keep in mind 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 initial program and when they changed the law in 2021 the banks were not doing ERC since 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 truly he or she’s never ever done it before do the banks do it nope the banks do not do it the payroll business yeah a few of them are doing it as a payroll business your accounting professional no your accounting professional’s never done this before unless you have an account that went into this company and bottom line my company Kevin has stayed in business because 2009 and we have actually been working with the federal government and the state government to recuperate money for Fortune 500 Fortune 1000 companies so a great deal of our big big corporate clients have dealt with bottom line to recover other federal government programs we’ve done sales tax and use tax joblessness tax work opportunity tax credits research and development tax credits unclaimed property 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 staff members on their payroll. The credit is 50% of as much as $10,000 in salaries paid by an.
Due to the fact that of COVID-19 or whose gross receipts, employer whose organization is totally or partly suspended.
decrease by more than 50%.
Availability.
1. The credit is readily available to all companies no matter size including tax exempt companies. There are.
just 2 exceptions: (1) state and city governments and their instrumentalities and (2) small.
companies who take Small Business Loans.
2. To certify, the company needs to satisfy one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the company’s company is totally or partially suspended by government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross invoices are below 50% of the similar quarter in 2019. When the.
company’s gross invoices exceed 80% of a similar quarter in 2019 they no longer certify.
after completion of that quarter.
Calculation of the Credit.
The quantity of the credit is 50% of the qualifying earnings paid up to $10,000 in total.
It works for salaries paid after March 13th and before December 31, 2020.
The definition of qualifying salaries varies by whether a company had, on average, basically than.
100 staff members in 2019.
Business that concentrate on ERC filing help generally offer know-how and assistance to assist services navigate the intricate process of declaring the credit. They can provide different services, consisting of:.
How is the employee retention credit calculated? Essential Business Employee Retention Credit
Eligibility Assessment: These companies will assess your business’s eligibility for the ERC based on aspects such as your industry, earnings, and operations. If you fulfill the requirements for the credit and identify the optimum credit quantity you can declare, they can help determine.
Paperwork and Computation: ERC filing services will assist in collecting the required documentation, such as payroll records and financial statements, to support your claim. They will also help calculate the credit amount based upon qualified earnings and other qualifying expenses.
Retroactive Claim Evaluation: If you are qualified to declare the ERC for prior quarters, these business can evaluate your past payroll records and financials to recognize prospective opportunities for retroactive credits. They can assist you modify prior income tax return to declare these refunds.
Filing Support: Business concentrating on ERC filings will prepare and send the required kinds and documents on your behalf. This includes finishing Form 941 or any other required tax forms.
Compliance and Updates: ERC guidelines and assistance have progressed in time. These companies remain updated with the most recent modifications and ensure that your filings abide by the most current standards. They can also provide continuous support if the IRS requests additional information or conducts an audit related to your ERC claim.
It’s important to research and veterinarian any business offering ERC filing help to ensure their trustworthiness and know-how. Look for recognized firms with experience in tax and payroll services, or consider connecting to relied on accounting companies or tax specialists who use ERC filing support.
Keep in mind that while these companies can supply valuable assistance, it’s constantly a great concept to have a fundamental understanding of the ERC requirements and procedure yourself. This will assist you make notified decisions and ensure precise filings.
The Employee Retention Credit (ERC) is a refundable tax credit presented by the U.S. government as part of COVID-19 relief steps. The goal of the ERC is to motivate 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 offered to eligible employers, including for-profit companies, tax-exempt companies, and particular governmental entities. To certify, companies must fulfill one of two criteria:.
The business operations were completely or partly suspended due to a federal government order related to COVID-19.
Business experienced a considerable decline in gross invoices. As mentioned earlier, for 2021, a considerable decrease is defined as a 20% decrease in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a significant decline is defined as a 20% decline in gross receipts compared to the very same quarter in 2019, or a 20% decline in gross receipts compared to the right away 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 portion (up to 70%) of certified wages paid to staff members, consisting of particular 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: Initially, businesses that got a Paycheck Protection Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 allows companies to declare the ERC even if they received a PPP loan. Nevertheless, 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, enabling eligible companies to declare the credit for certified earnings paid as far back as March 13, 2020. This retroactive arrangement supplies a chance for organizations to modify prior-year tax returns and get refunds.
Claiming 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 developed gradually. The best course of action is to consult with a tax expert or go to the main internal revenue service website for the most in-depth and current details concerning the ERC, including any current legislative modifications or updates.
To qualify for the ERC, a business should meet one of the following requirements:.
The business operations were fully or partly suspended due to a government order related to COVID-19.
The business experienced a considerable decline in gross receipts. For 2021, a considerable decline is defined as a 20% decrease in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a considerable decline is defined as a 20% decline in gross invoices compared to the exact same quarter in 2019, or a 20% decline in gross receipts compared to the instantly preceding quarter.
The ERC is readily available to businesses of all sizes, including tax-exempt companies, but there are some exceptions. For instance, government entities and organizations that received a PPP loan might have limitations on declaring the credit.
The procedure for claiming the ERC includes finishing the necessary kinds and consisting of the credit on your employment tax return (generally Form 941). The exact time it takes to process the credit can vary based on numerous elements, including the complexity of your service and the workload of the IRS. It’s advised to seek advice from a tax expert for assistance specific to your situation.
There are a number of business that can help with the process of claiming the ERC. These include accounting firms, tax advisory services, and payroll provider. Some well-known business that use help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s suggested to research study and get in touch with these business straight to inquire about their costs and services.
Please keep in mind that the details offered here is based on general knowledge and might not show the most recent updates or changes to the ERC. It is very important to talk to a tax expert or visit the main IRS site for the most accurate and current info relating to eligibility, declaring treatments, and offered support.
Less than 100. If the company had 100 or fewer workers usually in 2019, then the credit is based.
on salaries paid to all employees whether they actually worked or not. To put it simply, even if the.
workers worked full time and earned 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.
allowed just for earnings paid to workers who did not work throughout the calendar quarter.
In both cases, “incomes” consists of not simply cash payments but likewise a portion of the cost of employer.
provided health care. Essential Business Employee Retention Credit
Payment.
Employers can be instantly repaid for the credit by reducing the quantity of payroll taxes they.