Lets talk first about 280C Employee Retention Credit :
Our team here what do these men doing everybody in this room is helping teach people about ERC and uh constantly provide a stunning breakfast and have people actually find out about the program we ought to head to the room where we are able to display a few of the checks that we are getting for companies and I want to see that what is this this is uh numerous millions of dollars literally Kevin hundreds of millions of dollars so these are duplicate copies of the letters that go to customers verifying that the check is on the method I mean you know if you simply start to look at a few of these here I mean this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I suggest it’s just I imply consider how many actual clients that went through the program yeah this is the very end this is the party at the end when the check is confirmed the numbers are confirmed and the check is on the mail in the mail from the IRS heading to the client so that’s how you have the ability to track it you understand when you
get this you understand the check is gone for sure and that’s when they pay so they don’t pay anything up until they really receive the money they do not pay bottom line Wonder trust anything till this letter is verified the check is on the method they deposit it into their checking account and they can genuinely rely on Wonder trust that the procedure has actually been completed and how many you think you’ve processed because you began 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 Fantastic here you’re at my YouTube channel we’re discussing something truly essential today the employee retention credit which the majority of you have actually never become aware of I definitely hadn’t heard of it till extremely recently and learned a lot about it due to the fact that this is most likely the lowest expense of capital for any small company anywhere
anytime if you have staff members in between five and five hundred so I have actually got the professional with me this is Josh Fox he’s the founder and CEO of bottom line Concepts they’re the largest processor of these ERC credits this is a 170 page program so it’s challenging this isn’t like PPP we just phone 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’ve become yes the Ambassador and paid spokesperson for this I like this program it’s disappearing soon you got to discover all about it let’s talk staff member 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 provided services three opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly 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.
remedy the money cash payroll tax refund okay go on sorry I simply need to ensure we got that point I imply that’s a huge distinction a loan versus cash cash I like money cash that’s what we’re talking 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 initial cares Act is the ERC and yes Kevin it is a gorgeous difficult check in the mail where you get real money from the internal revenue service all right so let’s discuss how it works since it sounds like to me if it’s a if it’s employee retention credit that individual 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 employees right you needed to have actually owned an organization but it’s based on you having W-2 employees 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 qualified 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 six quarters the program was open well stroll us through the 6 quarters so you had quarters 2 three and four of 2020 and you had quarters one two and 3 of 2021. okay so that’s how it’s measured you have to be on the W-2 throughout that period now let’s talk my favorite part money just how much can you return per worker that was on a W-2 in those 6 quarters so the computation in 2020 to be precise Kevin is 50 of the staff member’s wage 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 income to a maximum of 7 thousand per quarter how did that take place um they just changed the rules in.
2021 versus since the chaos 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 approximately 5 thousand Max and after that what happens 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 since that’s a lot of cash it is now there’s a caveat here the PPP cash would have to be decreased 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 usually Kevin is if you took PPP money somewhere around ten thousand dollars a person so let’s say hypothetically you owned a restaurant in New York 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 IRS so it’s huge undoubtedly now the huge question is why does no one learn about this because appearance when I initially became aware of this when I first fulfilled Josh you understand I have actually got great deals of financial investments in lots of business I’m a major advocate for entrepreneurship in America and make many many financial investments in entrepreneurs of which numerous suffered through the pandemic when I first found out about this I called BS I do not think it since I utilize the PPP we went through the cash 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 should have and we used them sensibly to stay alive during the pandemic so when I heard about this I stated nah it can’t be true but when I dug around I even contacted us to my politician friends Guv Senators they didn’t know about it I mean that’s how you understand that’s how false information is that there’s no info out there then a lot of people told me well you can’t get it since you took the PPP likewise not real so let’s ask Josh why does no one learn about the employee retention credit you understand what’s interesting you’re speaking about the banks Kevin since in the PPP loan procedure the federal government made it very 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 simply process process that’s all um and here there was turmoil since remember in the initial cares act you could refrain from doing both programs so if you had done PPP you could refrain from doing 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 made it clear to anybody about how to.
do this does your CFO understand how to do this not really she or he’s never done it before 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 company your accounting professional no your accountant’s never done this prior to unless you have an account that went into this business and bottom line my company Kevin has been in business given that 2009 and we’ve been dealing with the federal government and the state federal government to recuperate cash for Fortune 500 Fortune 1000 companies so a great deal of our huge big corporate clients have dealt 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 government programs.
The staff member retention tax credit is a broad based refundable tax credit designed to encourage.
companies to keep workers on their payroll. The credit is 50% of approximately $10,000 in earnings paid by an.
Due to the fact that of COVID-19 or whose gross invoices, employer whose company is totally or partially suspended.
decrease by more than 50%.
1. The credit is readily available to all companies regardless of size consisting of tax exempt companies. There are.
just 2 exceptions: (1) state and city governments and their instrumentalities and (2) little.
companies who take Small company Loans.
2. To certify, the employer has to fulfill one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the employer’s service is completely or partly suspended by 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. When the.
employer’s gross receipts go above 80% of a comparable quarter in 2019 they no longer certify.
after the end of that quarter.
Calculation of the Credit.
The amount of the credit is 50% of the qualifying salaries paid up to $10,000 in total.
It works for salaries paid after March 13th and before December 31, 2020.
The meaning of qualifying wages varies by whether an employer had, on average, more or less than.
100 staff members in 2019.
Companies that specialize in ERC filing support generally offer knowledge and assistance to assist organizations browse the complex procedure of claiming the credit. They can provide different services, consisting of:.
How is the employee retention credit calculated? 280C Employee Retention Credit
Eligibility Assessment: These companies will assess your business’s eligibility for the ERC based on aspects such as your market, revenue, and operations. If you satisfy the requirements for the credit and identify the optimum credit amount you can claim, they can help determine.
Documentation and Computation: ERC filing services will help in gathering the needed documentation, such as payroll records and monetary statements, to support your claim. They will also assist determine the credit quantity based on qualified wages and other certifying expenses.
Retroactive Claim Review: If you are qualified to declare the ERC for prior quarters, these business can review your past payroll records and financials to recognize potential chances for retroactive credits. They can assist you amend prior tax returns to declare these refunds.
Filing Assistance: Companies focusing on ERC filings will prepare and send the needed forms and paperwork in your place. This consists of completing Form 941 or any other required tax forms.
Compliance and Updates: ERC policies and assistance have evolved gradually. These business stay upgraded with the current modifications and ensure that your filings adhere to the most present guidelines. If the Internal revenue service requests extra details or carries out an audit associated to your ERC claim, they can likewise supply ongoing support.
It is essential to research and veterinarian any business offering ERC filing assistance to guarantee their reliability and proficiency. Try to find recognized companies with experience in tax and payroll services, or consider connecting to relied on accounting companies or tax specialists who provide ERC filing assistance.
Bear in mind that while these business can supply important assistance, it’s constantly a good idea to have a standard understanding of the ERC requirements and procedure yourself. This will help you make informed choices and ensure precise filings.
The Worker Retention Credit (ERC) is a refundable tax credit presented by the U.S. government as part of COVID-19 relief procedures. The goal of the ERC is to encourage services to keep and pay their workers during the pandemic, even if their operations have actually been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is offered to eligible companies, including for-profit companies, tax-exempt organizations, and certain governmental entities. To qualify, companies must fulfill one of two criteria:.
The business operations were completely or partially suspended due to a federal government order related to COVID-19.
Business experienced a substantial decrease in gross invoices. As pointed out previously, for 2021, a significant 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% decrease in gross receipts compared to the very same quarter in 2019, or a 20% decrease in gross receipts compared to the immediately 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 salaries paid to staff members, 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, businesses that got an Income Protection Program (PPP) loan were not qualified for the ERC. However, legislation passed in late 2020 and extended in 2021 enables businesses to declare the ERC even if they received a PPP loan. The same earnings can not be utilized to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively broadened and improved, permitting eligible employers to claim the credit for certified wages paid as far back as March 13, 2020. This retroactive provision provides a chance for companies to amend prior-year income tax return and receive refunds.
Claiming the Credit: Companies can claim the ERC by reporting it on their work tax returns, usually Kind 941. If the credit goes beyond the amount of employment taxes owed, the excess can be refunded to the company.
It is necessary to keep in mind that the ERC provisions and eligibility criteria have evolved over time. The best course of action is to seek advice from a tax expert or check out the official IRS site for the most up-to-date and comprehensive info relating to the ERC, consisting of any recent legislative modifications or updates.
To receive the ERC, a business must satisfy one of the following requirements:.
The business operations were totally or partially suspended due to a government order related to COVID-19.
Business experienced a substantial decline in gross receipts. For 2021, a considerable decline is specified as a 20% decline in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a significant decline is defined as a 20% decrease in gross invoices compared to the very same quarter in 2019, or a 20% decrease in gross receipts compared to the immediately preceding quarter.
The ERC is readily available to organizations of all sizes, consisting of tax-exempt companies, however there are some exceptions. For example, federal government entities and services that got a PPP loan might have constraints on claiming the credit.
The procedure for declaring the ERC involves finishing the necessary types and consisting of the credit on your employment tax return (typically Form 941). The exact time it takes to process the credit can differ based on a number of factors, consisting of the complexity of your business and the workload of the IRS. It’s recommended to speak with a tax expert for assistance particular to your circumstance.
There are a number of companies that can help with the process of claiming the ERC. Some popular companies that use assistance with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the information provided here is based upon basic knowledge and may not show the most current updates or modifications to the ERC. It is very important to talk to a tax expert or check out the official IRS website for the most accurate and updated info regarding eligibility, claiming procedures, and available support.
Less than 100. The credit is based if the company had 100 or fewer employees on average in 2019.
on incomes paid to all workers whether they actually worked or not. Simply put, even if the.
workers worked full-time and got paid for full-time work, the employer still gets the credit.
Greater than 100. The credit is if the company had more than 100 staff members on average in 2019.
allowed only for incomes paid to employees who did not work during the calendar quarter.
In both cases, “wages” consists of not just money payments however likewise a part of the cost of company.
supplied health care. 280C Employee Retention Credit
Companies can be instantly repaid for the credit by decreasing the amount of payroll taxes they.