Lets talk first about Us Cares Act Employee Retention Credit :
Our team here what do these guys doing everybody in this room is helping teach people about ERC and uh constantly provide a beautiful breakfast and have individuals really discover the program we ought to head to the space where we have the ability to display a few 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 literally 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 mean you understand if you simply begin to take a 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 suggest it’s just I suggest think of the number of 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 validated and the check is on the mail in the mail from the IRS heading to the consumer so that’s how you’re able to track it you understand when you
receive this you understand the check is chosen sure which’s when they pay so they do not pay anything till they in fact get the money they don’t pay bottom line Wonder trust anything till this letter is validated the check is on the way they transfer it into their savings account and they can genuinely trust Wonder trust that the process has actually been completed and how many 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 plainly they understand what they’re doing which’s what you require you need experts on the other end of the phone to process this and get it to where you get one of these that’s what matters all right Mr Terrific here you’re at my YouTube channel we’re talking about something truly essential today the staff member retention credit which most of you have actually never heard of I certainly had not heard of it till very just recently and learned a lot about it since this is most likely the most affordable cost of capital for any small business anywhere
anytime if you have workers between five and five hundred so I’ve got the professional with me this is Josh Fox he’s the creator 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 simply call your bank supervisor and say provide me a loan it doesn’t work there’s not a loan it’s an application and Josh is going to tell us all 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 disappearing soon you got to find out everything about it let’s talk worker retention credit Josh Fox what is an ERC let’s just begin there so throughout the Trump Administration when President Trump was enacted they developed the cares Act and the cares act used 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 big distinction right there two of them are loans and one’s a refund exactly so the ERC is a refund that’s.
correct the money money payroll tax refund okay go on sorry I just have to make sure we got that point I indicate that’s a big difference a loan versus money money I like money money 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 hard check in the mail where you get real money from the internal revenue service all right so let’s discuss how it works due to the fact that it seems like to me if it’s a if it’s employee retention credit that person had to be an employee so I’m going to make the Presumption 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 an organization but it’s based upon you having W-2 workers 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 first 6 months of 2021 on the W-2 proper so there were 6 quarters the program was open well stroll 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. all right so that’s how it’s measured you have to be on the W-2 throughout that duration now let’s talk my favorite part money how much can you return per employee that was on a W-2 in those 6 quarters so the estimation in 2020 to be exact Kevin is 50 of the employee’s income to an optimum of five thousand dollars per worker for the year of 2020 and in 2021 the numbers increased to 70 of the worker’s income to an optimum of 7 thousand per quarter how did that take place um they simply altered the rules in.
2021 versus due to the fact that 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 after that 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 6 thousand dollars per worker that is since that’s a great deal of money 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 two you would decrease 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 cash you would still get a million dollar in the mail from the internal revenue service so it’s big certainly now the big concern is why does nobody know about this since appearance when I initially heard about this when I initially satisfied Josh you understand I have actually got great deals of financial investments in great deals of business I’m a significant advocate for entrepreneurship in America and make many many financial investments in business owners of which lots of suffered through the pandemic when I first found out about this I called BS I don’t believe it due to the fact that I use the PPP we went through the money center Banks to get it it was really easy to do we had our CEOs call the banks they got their loans which were well deserved and we used them sensibly to stay alive during the pandemic so when I became aware of this I said nah it can’t be true but when I dug around I even called to my politician pals Governor Senators they didn’t learn about it I mean that’s how you know that’s how misinformation is that there’s no information out there then a lot of individuals informed me well you can’t get it since you took the PPP likewise 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 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 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 procedure that’s all um and here there was turmoil since keep in mind in the initial cares act you might not do both programs so if you had done PPP you could not do ERC in the initial program and when they changed 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 actually she or he’s never done it in the past 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 company your accounting professional no your accounting professional’s never done this before unless you have an account that entered into this company and bottom line my firm Kevin has stayed in business since 2009 and we’ve been dealing with the federal government and the state federal government to recover cash for Fortune 500 Fortune 1000 companies so a lot of our big big business customers have dealt with bottom line to recover other federal government programs we’ve done sales tax and utilize tax joblessness tax work opportunity tax credits research and development tax credits unclaimed home real estate tax all of these other federal government programs.
The employee retention tax credit is a broad based refundable tax credit designed to motivate.
employers to keep employees on their payroll. The credit is 50% of as much as $10,000 in incomes paid by an.
employer whose company is totally or partly suspended because of COVID-19 or whose gross receipts.
decline by more than 50%.
1. The credit is readily available to all companies regardless of size including tax exempt companies. There are.
just two exceptions: (1) state and city governments and their instrumentalities and (2) little.
businesses who take Small Business Loans.
2. To certify, the employer has to satisfy one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the company’s organization is totally or partially suspended by federal government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross invoices are below 50% of the comparable quarter in 2019. As soon as the.
company’s gross invoices exceed 80% of an equivalent quarter in 2019 they no longer certify.
after completion of that quarter.
Estimation of the Credit.
The amount of the credit is 50% of the qualifying incomes paid up to $10,000 in overall.
It works for wages paid after March 13th and before December 31, 2020.
The meaning of certifying incomes varies by whether an employer had, on average, basically than.
100 workers in 2019.
Companies that focus on ERC filing assistance generally provide know-how and assistance to assist businesses browse the complicated process of claiming the credit. They can provide numerous services, including:.
How is the employee retention credit calculated? Us Cares Act Employee Retention Credit
Eligibility Evaluation: These companies will examine your organization’s eligibility for the ERC based on aspects such as your market, earnings, and operations. If you meet the requirements for the credit and determine the optimum credit quantity you can claim, they can assist figure out.
Documents and Estimation: ERC filing services will assist in gathering the essential documents, such as payroll records and financial statements, to support your claim. They will also assist compute the credit quantity based upon eligible incomes and other certifying expenses.
Retroactive Claim Review: If you are eligible to declare the ERC for prior quarters, these business can examine your past payroll records and financials to determine potential opportunities for retroactive credits. They can assist you change prior income tax return to declare these refunds.
Filing Assistance: Business focusing on ERC filings will prepare and submit the needed types and documents in your place. This includes completing Kind 941 or any other necessary tax return.
Compliance and Updates: ERC regulations and assistance have actually evolved in time. These companies remain upgraded with the current modifications and make sure that your filings abide by the most existing standards. They can also provide continuous support if the internal revenue service demands extra information or carries out an audit related to your ERC claim.
It is essential to research and veterinarian any company offering ERC filing help to guarantee their trustworthiness and proficiency. Try to find established firms with experience in tax and payroll services, or consider connecting to relied on accounting companies or tax experts who provide ERC submitting support.
Keep in mind that while these business can provide valuable help, it’s constantly a good idea to have a fundamental understanding of the ERC requirements and procedure yourself. This will assist you make notified choices and make sure accurate filings.
The Employee Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief measures. The objective of the ERC is to motivate companies to keep and pay their employees throughout the pandemic, even if their operations have actually been affected.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is available to eligible employers, including for-profit businesses, tax-exempt organizations, and specific governmental entities. To qualify, employers must fulfill one of two criteria:.
The business operations were fully or partly suspended due to a federal government order related to COVID-19.
Business experienced a significant decline in gross receipts. As pointed out earlier, for 2021, a substantial decrease is defined as a 20% decline in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a significant decrease is specified as a 20% decline in gross receipts compared to the exact same quarter in 2019, or a 20% decline in gross receipts compared to the immediately preceding quarter.
Credit Amount: 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 (as much as 70%) of qualified salaries paid to employees, including particular health insurance 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: At first, companies that got an Income Protection Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 permits businesses to claim the ERC even if they received a PPP loan. Nevertheless, the 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 enhanced, enabling eligible companies to declare the credit for qualified incomes paid as far back as March 13, 2020. This retroactive provision offers a chance for organizations to amend prior-year tax returns and get refunds.
Claiming the Credit: Employers can claim the ERC by reporting it on their employment tax returns, normally 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 note that the ERC provisions and eligibility criteria have evolved gradually. The very best course of action is to seek advice from a tax expert or go to the official internal revenue service site for the most comprehensive and current information relating to the ERC, including any recent legislative changes or updates.
To get approved for the ERC, a business must fulfill among the following requirements:.
Business operations were totally or partly suspended due to a government order related to COVID-19.
Business experienced a significant decrease in gross invoices. For 2021, a considerable decline is defined as a 20% decline 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 receipts compared to the very same quarter in 2019, or a 20% decrease in gross receipts 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. Government entities and organizations that got a PPP loan may have constraints on claiming the credit.
The procedure for declaring the ERC involves completing the needed kinds and including the credit on your work tax return (normally Type 941). The exact time it takes to process the credit can differ based on several factors, consisting of the complexity of your organization and the workload of the IRS. It’s suggested to talk to a tax professional for guidance specific to your scenario.
There are a number of business that can help with the process of declaring the ERC. Some widely known companies that offer assistance with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the information offered here is based upon basic understanding and might not show the most recent updates or changes to the ERC. It’s important to talk to a tax professional or go to the official IRS website for the most up-to-date and precise info regarding eligibility, declaring treatments, and readily available help.
Less than 100. The credit is based if the company had 100 or fewer staff members on average in 2019.
on incomes paid to all employees whether they actually worked or not. To put it simply, even if the.
staff members worked full time and earned money for full-time work, the employer still gets the credit.
Greater than 100. If the company had more than 100 workers typically in 2019, then the credit is.
allowed just for wages paid to employees who did not work during the calendar quarter.
In both cases, “wages” consists of not simply money payments however likewise a part of the expense of employer.
provided healthcare. Us Cares Act Employee Retention Credit
Companies can be right away repaid for the credit by decreasing the quantity of payroll taxes they.