Lets talk first about Illinois Employee Retention Credit Subtraction :
Our team here what do these guys doing everybody in this room is assisting teach people about ERC and uh constantly provide a lovely breakfast and have people truly discover the program we should 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 countless dollars literally Kevin numerous millions of dollars so these are replicate copies of the letters that go to customers validating that the check is on the method I imply you know if you just start to look at a few of these here I imply this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I imply it’s just I mean think of 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 verified the numbers are confirmed and the check is on the mail in the mail from the internal revenue service heading to the customer so that’s how you have the ability to track it you understand when you
get this you know the check is opted for sure and that’s when they pay so they don’t pay anything until they actually receive the money they don’t pay bottom line Wonder trust anything till 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 finished and the number of you think you have actually processed since 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 need you need 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 Terrific here you’re at my YouTube channel we’re speaking about something really important today the worker retention credit which the majority of you have actually never heard of I certainly hadn’t become aware of it up until really just recently and found out a lot about it since this is most likely the lowest expense of capital for any small business anywhere
anytime if you have employees 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 largest processor of these ERC credits this is a 170 page program so it’s not easy this isn’t like PPP we simply contact your bank manager and state offer 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 have actually become yes the Ambassador and paid spokesperson for this I enjoy this program it’s going away soon you got to learn all about it let’s talk employee retention credit Josh Fox what is an ERC let’s simply begin there so throughout the Trump Administration when President Trump was enacted they came up with the cares Act and the cares act offered services three opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically 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 fine go on sorry I just need to make certain we got that point I indicate that’s a big difference a loan versus cash money 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 original cares Act is the ERC and yes Kevin it is a gorgeous tough check in the mail where you get actual cash 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 worker retention credit that individual needed to be a worker so I’m going to make the Assumption this cash is not for the owner not for individuals on the cap table not for investors it’s for workers right you had to have owned a company however it’s based on you having W-2 workers in America not 10.99. 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 have to be on payroll for the first 6 months of 2021 on the W-2 proper so there were six quarters the program was open well walk us through the six quarters so you had quarters two 3 and four of 2020 and you had quarters one two and three of 2021. okay so that’s how it’s determined you need to be on the W-2 during that duration now let’s talk my favorite part money how much can you get back per worker 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 wage to a maximum of 5 thousand dollars per employee for the year of 2020 and in 2021 the numbers escalated to 70 of the employee’s salary to an optimum of 7 thousand per quarter how did that happen um they just altered the rules in.
2021 versus since the chaos 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 approximately 5 thousand Max and then what occurs 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 employee that is because that’s a lot of cash it is now there’s a caution here the PPP money would need to be reduced from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan two you would reduce the 26 000 so what we’re seeing typically Kevin is if you took PPP cash somewhere around ten thousand dollars an individual 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 IRS so it’s big undoubtedly now the huge concern is why does no one know about this due to the fact that appearance when I first found out about this when I first met Josh you understand I’ve got great deals of investments in great deals of business I’m a significant supporter for entrepreneurship in America and make numerous lots of financial investments in entrepreneurs of which lots of suffered through the pandemic when I initially found out about this I called BS I do not believe it due to the fact that I use 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 which were well should have and we utilized them wisely to stay alive throughout the pandemic so when I found out about this I stated nah it can’t hold true but when I dug around I even contacted us to my political leader friends Governor Senators they didn’t know about it I imply that’s how you understand that’s how false information is that there’s no info out there then a lot of people informed me well you can’t get it due to the fact that you took the PPP also not real so let’s ask Josh why does no one learn about the worker retention credit you understand what’s interesting 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 big banks in our nation 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 turmoil due to the fact that keep in mind in the initial cares act you might not do both programs so if you had actually done PPP you could not do ERC in the initial program and when they altered the law in 2021 the banks were refraining from doing ERC because it’s not alone so you’re getting a tax refund so the government never ever made it clear to any person about how to.
do this does your CFO know how to do this not really he or she’s never done it previously do the banks do it nope the banks don’t 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 prior to unless you have an account that entered into this service and bottom line my firm Kevin has stayed in business because 2009 and we have actually been working with the federal government and the state government to recover money for Fortune 500 Fortune 1000 business so a lot of our huge huge corporate clients have worked with bottom line to recuperate other federal government programs we have actually done sales tax and utilize tax unemployment tax work chance tax credits research and development tax credits unclaimed home real estate tax all of these other federal government programs.
The worker retention tax credit is a broad based refundable tax credit created to motivate.
employers to keep workers on their payroll. The credit is 50% of approximately $10,000 in incomes paid by an.
Due to the fact that of COVID-19 or whose gross receipts, employer whose organization is completely or partly suspended.
decrease by more than 50%.
1. The credit is offered to all employers despite size consisting of tax exempt companies. There are.
just 2 exceptions: (1) state and local governments and their instrumentalities and (2) little.
services who take Small Business Loans.
2. To certify, the employer needs to satisfy one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the employer’s service is completely or partly suspended by federal government order due to COVID-19.
during the calendar quarter or.
o the employer’s gross receipts are listed below 50% of the equivalent quarter in 2019. As soon as the.
company’s gross receipts exceed 80% of an equivalent quarter in 2019 they no longer certify.
after the end of that quarter.
Computation of the Credit.
The quantity of the credit is 50% of the certifying wages paid up to $10,000 in total.
It is effective for earnings paid after March 13th and before December 31, 2020.
The meaning of certifying earnings varies by whether an employer had, usually, basically than.
100 employees in 2019.
Business that focus on ERC filing help normally supply proficiency and assistance to help organizations navigate the complicated procedure of claiming the credit. They can offer various services, consisting of:.
How is the employee retention credit calculated? Illinois Employee Retention Credit Subtraction
Eligibility Assessment: These business will examine your organization’s eligibility for the ERC based upon factors such as your industry, profits, and operations. If you fulfill the requirements for the credit and recognize the optimum credit quantity you can claim, they can help determine.
Documents and Estimation: ERC filing services will assist in collecting the essential documents, such as payroll records and monetary declarations, to support your claim. They will likewise assist determine the credit quantity based upon eligible salaries and other certifying expenses.
Retroactive Claim Evaluation: If you are qualified to claim the ERC for prior quarters, these business can review your previous payroll records and financials to recognize possible chances for retroactive credits. They can assist you modify previous income tax return to claim these refunds.
Filing Support: Companies specializing in ERC filings will prepare and send the necessary forms and paperwork on your behalf. This includes completing Form 941 or any other required tax forms.
Compliance and Updates: ERC policies and assistance have progressed in time. These companies stay upgraded with the latest modifications and guarantee that your filings adhere to the most current standards. They can likewise provide continuous assistance if the internal revenue service demands extra info or performs an audit related to your ERC claim.
It is necessary to research and veterinarian any business offering ERC filing assistance to ensure their reliability and competence. Try to find established companies with experience in tax and payroll services, or think about reaching out to trusted accounting companies or tax professionals who provide ERC filing support.
Keep in mind that while these companies can provide important support, it’s always a good idea to have a basic understanding of the ERC requirements and procedure yourself. This will assist you make notified choices and make sure precise filings.
The Worker 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 keep and pay their employees during the pandemic, even if their operations have been affected.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is available to qualified companies, consisting of for-profit organizations, tax-exempt organizations, and particular governmental entities. To qualify, companies should fulfill one of two requirements:.
The business operations were totally or partially suspended due to a government order related to COVID-19.
The business experienced a significant decline in gross receipts. As discussed previously, for 2021, a considerable decrease is specified as a 20% decrease in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a considerable decline is defined as a 20% decrease 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 employer’s share of Social Security taxes. The credit quantity is equal to a percentage (approximately 70%) of certified wages paid to staff members, including particular health plan expenditures. 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, companies that got an Income Defense Program (PPP) loan were not qualified for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 allows services to declare the ERC even if they got a PPP loan. The exact same incomes can not be utilized to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively broadened and boosted, allowing eligible employers to declare the credit for qualified wages paid as far back as March 13, 2020. This retroactive provision provides a chance for businesses to change prior-year income tax return and receive refunds.
Claiming the Credit: Companies can declare the ERC by reporting it on their work income tax return, typically Form 941. The excess can be reimbursed to the employer if the credit goes beyond the amount of work taxes owed.
It’s important to keep in mind that the ERC provisions and eligibility requirements have evolved in time. The best strategy is to consult with a tax expert or check out the official IRS site for the most detailed and current information regarding the ERC, consisting of any current legal changes or updates.
To get approved for the ERC, a company should meet one of the following requirements:.
The business operations were fully or partially suspended due to a government order related to COVID-19.
Business experienced a substantial decrease in gross invoices. For 2021, a significant decrease is defined as a 20% decline in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a significant decrease is defined as a 20% decrease in gross receipts compared to the same quarter in 2019, or a 20% decline in gross invoices compared to the instantly preceding quarter.
The ERC is available to businesses of all sizes, consisting of tax-exempt organizations, but there are some exceptions. For instance, government entities and services that received a PPP loan might have limitations on declaring the credit.
The process for declaring the ERC includes finishing the necessary kinds and consisting of the credit on your work income tax return (usually Form 941). The exact time it takes to process the credit can vary based upon several elements, consisting of the intricacy of your organization and the workload of the internal revenue service. It’s suggested to speak with a tax expert for assistance particular to your situation.
There are several companies that can assist with the process of declaring the ERC. These consist of accounting companies, tax advisory services, and payroll provider. Some well-known business that provide help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s recommended to research and get in touch with these business straight to inquire about their services and charges.
Please note that the info supplied here is based upon general understanding and may not show the most current updates or changes to the ERC. It is essential to seek advice from a tax expert or go to the main IRS website for the most up-to-date and precise information concerning eligibility, claiming treatments, and offered support.
Less than 100. If the company had 100 or fewer staff members usually in 2019, then the credit is based.
on earnings paid to all employees whether they really worked or not. In other words, even if the.
employees worked full time and earned money for full time work, the company still gets the credit.
Greater than 100. The credit is if the employer had more than 100 workers on average in 2019.
enabled only for wages paid to staff members who did not work throughout the calendar quarter.
In both cases, “salaries” includes not just cash payments but also a portion of the expense of employer.
offered health care. Illinois Employee Retention Credit Subtraction
Employers can be immediately reimbursed for the credit by decreasing the amount of payroll taxes they.