Lets talk first about New Stimulus Employee Retention Credit :
Our group here what do these men doing everybody in this space is assisting teach people about ERC and uh constantly offer a beautiful breakfast and have people actually learn about the program we need to head to the space where we are able 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 numerous 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 indicate you understand if you simply 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 mean it’s just I mean think about the number of real clients 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 validated and the check is on the mail in the mail from the internal revenue service heading to the customer so that’s how you’re able to track it you understand when you
receive this you know the check is opted for sure and that’s when they pay so they don’t pay anything up until they actually receive 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 bank account and they can truly trust Wonder trust that the procedure has been finished and how many you believe you have actually processed given that you started this we’re about 35 000 of these for
about 6 billion dollars wow so plainly they understand what they’re doing which’s what you require you require specialists 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 Fantastic here you’re at my YouTube channel we’re speaking about something truly crucial today the staff member retention credit which the majority of you have actually never ever become aware of I certainly had not become aware of it till extremely just recently and learned a lot about it since this is most likely the lowest cost of capital for any small company anywhere
anytime if you have staff members in between 5 and five hundred so I’ve got the specialist with me this is Josh Fox he’s the creator 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 simply call your bank supervisor and state provide me a loan it does not 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 spokesperson for this I enjoy this program it’s going away soon you got to find out all about it let’s talk staff member retention credit Josh Fox what is an ERC let’s simply start there so during the Trump Administration when President Trump was enacted they created the cares Act and the cares act provided organizations 3 opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and almost everybody it makes a huge distinction right there two of them are loans and one’s a refund precisely so the ERC is a refund that’s.
fix the cash money payroll tax refund alright go on sorry I just have to make certain we got that point I mean that’s a big distinction a loan versus cash cash I like money money that’s what we’re discussing 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 lovely tough check in the mail where you get real cash from the IRS all right so let’s speak about how it works since it sounds like to me if it’s a if it’s staff member retention credit that individual 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 shareholders it’s for staff members right you needed to have owned a service but it’s based on you having W-2 employees in America not 10.99. As long as you had W-2 staff members and you paid federal payroll taxes that’s why you would be qualified so you have to be on payroll in 2020 on the W-2 and you have to be on payroll for the very first six months of 2021 on the W-2 appropriate so there were six quarters the program was open well stroll us through the six quarters so you had quarters two three and 4 of 2020 and you had quarters one 2 and 3 of 2021. fine so that’s how it’s determined you need to be on the W-2 throughout that period now let’s talk my preferred part cash how much can you return per staff member that was on a W-2 in those 6 quarters so the calculation in 2020 to be precise Kevin is 50 of the employee’s salary to an optimum of five thousand dollars per staff member for the year of 2020 and in 2021 the numbers increased to 70 of the worker’s wage to a maximum of seven thousand per quarter how did that take place um they just changed the rules in.
2021 versus due to the fact that the mayhem of the pandemic so they wished 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 as much as 5 thousand Max and then what occurs 21 000 Max in 2021 oh that’s how you create twenty 6 thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty 6 thousand dollars per worker that is since that’s a lot of money it is now there’s a caution here the PPP cash would need to be lowered 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 usually Kevin is if you took PPP money someplace around 10 thousand dollars an individual so let’s state hypothetically you owned a restaurant in New York City where I’m from and you had a hundred staff members and you took PPP cash you would still get a million dollar in the mail from the IRS so it’s huge clearly now the huge question is why does no one know about this because appearance when I first became aware of this when I first met Josh you understand I have actually got great deals of financial investments in great deals of companies I’m a major advocate for entrepreneurship in America and make many lots of investments in business owners of which numerous suffered through the pandemic when I first heard 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 extremely easy to do we had our CEOs call the banks they got their loans which were well been worthy of and we used them sensibly to stay alive throughout the pandemic so when I heard about this I said nah it can’t hold true however when I dug around I even contacted us to my politician buddies Guv Senators they didn’t learn about it I imply that’s how you know that’s how misinformation is that there’s no information 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 know about the employee retention credit you understand what’s interesting you’re talking about the banks Kevin because in the PPP loan procedure 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 country and they would process process in Canada a pre-pp loan there’s no loans in Canada by the way it’s simply process process that’s all um and here there was turmoil due to the fact that keep in mind in the initial cares act you could not do both programs so if you had actually done PPP you might 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 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 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 ever done this prior to unless you have an account that went into this business and bottom line my firm Kevin has stayed in business since 2009 and we have actually been working with the federal government and the state government to recover money for Fortune 500 Fortune 1000 companies so a great deal of our huge huge corporate customers have dealt with bottom line to recuperate other government programs we’ve done sales tax and use tax joblessness tax work opportunity 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 developed to motivate.
employers to keep staff members on their payroll. The credit is 50% of up to $10,000 in earnings paid by an.
Since of COVID-19 or whose gross invoices, company whose organization is fully or partially suspended.
decrease by more than 50%.
1. The credit is readily available to all companies no matter size including tax exempt organizations. There are.
just two exceptions: (1) state and city governments and their instrumentalities and (2) little.
companies who take Small company Loans.
2. To qualify, the employer has to satisfy one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the employer’s service is fully or partly suspended by government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross receipts are listed below 50% of the equivalent 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 quantity of the credit is 50% of the qualifying earnings paid up to $10,000 in total.
It is effective for incomes paid after March 13th and prior to December 31, 2020.
The definition of qualifying salaries differs by whether a company had, on average, basically than.
100 employees in 2019.
Business that focus on ERC filing help typically provide expertise and support to help organizations navigate the intricate procedure of claiming the credit. They can use different services, including:.
How is the employee retention credit calculated? New Stimulus Employee Retention Credit
Eligibility Assessment: These companies will examine your service’s eligibility for the ERC based on elements such as your industry, revenue, and operations. If you meet the requirements for the credit and identify the maximum credit amount you can declare, they can assist identify.
Documents and Computation: ERC filing services will assist in collecting the necessary documentation, such as payroll records and financial declarations, to support your claim. They will likewise assist compute the credit quantity based upon eligible earnings and other certifying expenses.
Retroactive Claim Review: If you are qualified to declare the ERC for prior quarters, these business can review your previous payroll records and financials to identify prospective opportunities for retroactive credits. They can help you change prior income tax return to declare these refunds.
Filing Help: Business focusing on ERC filings will prepare and submit the required forms and documentation on your behalf. This consists of finishing Form 941 or any other necessary tax forms.
Compliance and Updates: ERC policies and guidance have actually progressed in time. These business stay updated with the latest changes and ensure that your filings adhere to the most current standards. If the IRS demands extra info or performs an audit related to your ERC claim, they can also offer continuous support.
It’s important to research and vet any company providing ERC filing help to guarantee their credibility and knowledge. Try to find recognized companies with experience in tax and payroll services, or think about connecting to relied on accounting companies or tax specialists who provide ERC filing support.
Keep in mind that while these companies can provide valuable assistance, it’s always a great concept to have a fundamental understanding of the ERC requirements and procedure yourself. This will help you make informed decisions and ensure accurate filings.
The Worker Retention Credit (ERC) is a refundable tax credit introduced by the U.S. federal government as part of COVID-19 relief measures. The goal of the ERC is to motivate organizations to keep and pay their employees 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 organizations, tax-exempt companies, and certain governmental entities. To qualify, employers must fulfill one of two criteria:.
Business operations were fully or partially suspended due to a government order related to COVID-19.
The business experienced a considerable decrease in gross receipts. As mentioned previously, for 2021, a considerable decrease is specified as a 20% decline in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a substantial decrease is specified as a 20% decrease in gross receipts compared to the exact same quarter in 2019, or a 20% decrease in gross invoices compared to the instantly preceding quarter.
Credit Amount: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit quantity amounts to a percentage (as much as 70%) of qualified salaries paid to workers, including particular health insurance expenditures. The maximum credit per employee 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 Defense Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 allows organizations to declare the ERC even if they received a PPP loan. The exact same earnings can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively expanded and boosted, permitting qualified employers to claim the credit for certified incomes paid as far back as March 13, 2020. This retroactive provision provides an opportunity for companies to amend prior-year tax returns and get refunds.
Declaring the Credit: Companies can claim the ERC by reporting it on their work income tax return, normally Kind 941. If the credit exceeds the amount of work taxes owed, the excess can be reimbursed to the company.
It is very important to keep in mind that the ERC arrangements and eligibility criteria have actually developed gradually. The very best course of action is to speak with a tax professional or go to the official internal revenue service site for the most up-to-date and detailed info relating to the ERC, including any recent legislative changes or updates.
To qualify for the ERC, a company must fulfill among the following requirements:.
Business operations were totally or partly suspended due to a federal government order related to COVID-19.
Business experienced a substantial decrease in gross receipts. For 2021, a substantial decline is specified as a 20% decline in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a significant decline is defined as a 20% decline in gross invoices compared to the very same quarter in 2019, or a 20% decline in gross invoices compared to the right away preceding quarter.
The ERC is offered to organizations of all sizes, consisting of tax-exempt organizations, however there are some exceptions. For instance, government entities and companies that received a PPP loan may have constraints on claiming the credit.
The process for declaring the ERC includes completing the required forms and including the credit on your work income tax return (usually Kind 941). The exact time it takes to process the credit can vary based on numerous aspects, including the complexity of your organization and the work of the IRS. It’s suggested to consult with a tax professional for assistance specific to your situation.
There are numerous companies that can aid with the procedure of claiming the ERC. These consist of accounting companies, tax advisory services, and payroll service providers. Some popular business that offer assistance with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s advisable to research and contact these business straight to ask about their services and fees.
Please note that the info supplied here is based upon basic knowledge and may not reflect the most recent updates or modifications to the ERC. It is necessary to seek advice from a tax professional or check out the main internal revenue service site for the most accurate and up-to-date details regarding eligibility, declaring procedures, and available support.
Less than 100. If the company had 100 or fewer employees on average in 2019, then the credit is based.
on earnings paid to all employees whether they actually worked or not. In other words, even if the.
workers worked full time and earned money for full-time work, the company still gets the credit.
Greater than 100. If the company had more than 100 staff members on average in 2019, then the credit is.
allowed only for salaries paid to employees who did not work during the calendar quarter.
In both cases, “salaries” includes not just cash payments but also a part of the expense of company.
provided health care. New Stimulus Employee Retention Credit
Employers can be instantly compensated for the credit by reducing the amount of payroll taxes they.