Lets talk first about Amending 941 For Employee Retention Credit :
Our team here what do these men doing everybody in this room is assisting teach people about ERC and uh always provide a stunning breakfast and have people truly learn about the program we must head to the space where we are able to display a few of the checks that we are getting for business and I wish to see that what is this this is uh numerous millions of dollars literally Kevin numerous millions of dollars so these are duplicate copies of the letters that go to clients verifying that the check is on the way I mean you know if you simply begin to look at a few of these here I suggest this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I imply it’s just I suggest think of how many actual 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 IRS heading to the client so that’s how you have the ability to track it you know when you
receive this you know the check is chosen sure and that’s when they pay so they don’t pay anything till they really receive the cash they do not pay bottom line Wonder trust anything until this letter is verified the check is on the way they deposit it into their checking account and they can truly trust Wonder trust that the process has been finished and the number of you believe you have actually processed considering that you started 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 require you require 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 Fantastic here you’re at my YouTube channel we’re talking about something really crucial today the staff member retention credit which the majority of you have never ever heard of I definitely hadn’t heard of it till extremely 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 employees in between five and five hundred so I have actually got the expert 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 hard this isn’t like PPP we just call up 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 us all about it and how to get it and why I’ve ended up being yes the Ambassador and paid representative for this I like this program it’s disappearing soon you got to find out everything 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 offered 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 difference 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 all right go on sorry I just have to ensure we got that point I imply that’s a big difference a loan versus money money I like money cash that’s what we’re speaking 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 gorgeous difficult check in the mail where you get real cash from the IRS all right so let’s talk about how it works since it seems like to me if it’s a if it’s staff member retention credit that individual needed to be a worker so I’m going to make the Presumption this cash is not for the owner not for individuals on the cap table not for shareholders it’s for workers right you needed to have actually owned a service but it’s based on you having W-2 employees in America not 10.99. so as long as you had W-2 employees 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 correct so there were six quarters the program was open well walk us through the 6 quarters so you had quarters 2 3 and four of 2020 and you had quarters one two and three of 2021. alright 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 how much can you get back per staff member that was on a W-2 in those six quarters so the estimation in 2020 to be exact Kevin is 50 of the worker’s salary to an optimum of 5 thousand dollars per staff member for the year of 2020 and in 2021 the numbers increased to 70 of the employee’s salary to an optimum of 7 thousand per quarter how did that happen um they just changed 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 up to five thousand Max and then what occurs 21 000 Max in 2021 oh that’s how you develop twenty six thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty 6 thousand dollars per staff member that is since that’s a great deal of money it is now there’s a caveat here the PPP money would have to be minimized from the twenty six thousand dollars so if you took PPP loan one and PPP loan 2 you would reduce the 26 000 so what we’re seeing usually Kevin is if you took PPP money somewhere around ten thousand dollars an individual so let’s state 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 money you would still get a million dollar in the mail from the IRS so it’s substantial certainly now the big question is why does no one understand about this because look when I initially became aware of this when I first met Josh you know I have actually got lots of investments in great deals of business I’m a significant supporter for entrepreneurship in America and make numerous many investments in entrepreneurs of which many suffered through the pandemic when I first became aware of this I called BS I don’t believe it since 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 and that were well been worthy of and we utilized them sensibly to survive during the pandemic so when I found out about this I said nah it can’t be true but when I dug around I even contacted us to my political leader pals Guv Senators they didn’t understand about it I suggest that’s how you understand that’s how misinformation is that there’s no details out there then a bunch of individuals informed me well you can’t get it due to the fact that you took the PPP likewise not true so let’s ask Josh why does nobody know about the staff member 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 really clear that if you desired a PPP loan you would call Wells Fargo Citibank Bank of America any of the huge 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 procedure that’s all um and here there was turmoil because keep in mind in the original cares act you could not do both programs so if you had done PPP you could refrain from doing ERC in the initial program and when they altered the law in 2021 the banks were refraining from doing ERC since it’s not alone so you’re getting a tax refund so the federal government never made it clear to any person about how to.
do this does your CFO know how to do this not really she or he’s never done it before do the banks do it nope the banks do not do it the payroll companies yeah a few of them are doing it as a payroll company your accountant no your accountant’s never done this before unless you have an account that went into this organization 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 government to recover cash for Fortune 500 Fortune 1000 business so a great deal of our big big corporate clients have actually worked with bottom line to recover other government programs we have actually done sales tax and utilize tax unemployment tax work opportunity tax credits research and development tax credits unclaimed property property tax all of these other federal government programs.
The staff member retention tax credit is a broad based refundable tax credit created to motivate.
companies to keep workers on their payroll. The credit is 50% of as much as $10,000 in wages paid by an.
Due to the fact that of COVID-19 or whose gross receipts, employer whose business is fully or partially suspended.
decrease by more than 50%.
1. The credit is readily available 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.
companies who take Small company Loans.
2. To certify, the company has to satisfy one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the employer’s company is fully or partially 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 comparable quarter in 2019. When the.
company’s gross receipts go above 80% of a comparable quarter in 2019 they no longer qualify.
after completion of that quarter.
Calculation of the Credit.
The amount of the credit is 50% of the qualifying salaries paid up to $10,000 in overall.
It works for incomes paid after March 13th and before December 31, 2020.
The definition of qualifying earnings differs by whether an employer had, usually, more or less than.
100 staff members in 2019.
Companies that specialize in ERC filing help usually offer knowledge and support to help companies navigate the complex procedure of claiming the credit. They can offer various services, consisting of:.
How is the employee retention credit calculated? Amending 941 For Employee Retention Credit
Eligibility Evaluation: These companies will examine your company’s eligibility for the ERC based on elements such as your market, profits, and operations. If you satisfy the requirements for the credit and identify the maximum credit quantity you can declare, they can help determine.
Documents and Estimation: ERC filing services will assist in gathering the essential documentation, such as payroll records and monetary declarations, to support your claim. They will likewise assist calculate the credit quantity based on eligible wages and other certifying expenditures.
Retroactive Claim Review: If you are qualified to declare the ERC for previous quarters, these companies can review your past payroll records and financials to determine possible chances for retroactive credits. They can assist you change prior tax returns to claim these refunds.
Filing Help: Companies focusing on ERC filings will prepare and send the essential types and paperwork on your behalf. This includes finishing Form 941 or any other necessary tax return.
Compliance and Updates: ERC regulations and guidance have actually evolved in time. These business stay updated with the current modifications and make sure that your filings adhere to the most current guidelines. If the IRS demands extra details or conducts an audit associated to your ERC claim, they can likewise supply continuous support.
It is essential to research and vet any company providing ERC filing help to guarantee their trustworthiness and competence. Try to find established firms with experience in tax and payroll services, or think about connecting to trusted accounting companies or tax specialists who provide ERC filing support.
Bear in mind that while these companies can supply important help, it’s always a good idea to have a fundamental understanding of the ERC requirements and process yourself. This will help you make informed choices and make sure precise filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit presented by the U.S. government as part of COVID-19 relief steps. The objective of the ERC is to motivate organizations to retain and pay their staff members during the pandemic, even if their operations have actually been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is offered to qualified employers, consisting of for-profit companies, tax-exempt organizations, and specific governmental entities. To qualify, companies need to satisfy one of two requirements:.
The business operations were fully or partly suspended due to a federal government order related to COVID-19.
Business experienced a significant decrease in gross invoices. As mentioned earlier, for 2021, a significant decrease is defined as a 20% decrease in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a considerable decline is defined as a 20% decline in gross invoices compared to the very same quarter in 2019, or a 20% decrease in gross invoices 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 percentage (as much as 70%) of qualified earnings paid to staff members, consisting of specific 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, organizations that got a Paycheck Security Program (PPP) loan were not eligible for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 allows businesses to claim the ERC even if they got a PPP loan. The very same earnings can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively expanded and improved, permitting qualified companies to declare the credit for qualified earnings paid as far back as March 13, 2020. This retroactive provision provides an opportunity for services to change prior-year income tax return and receive refunds.
Claiming the Credit: Companies can claim the ERC by reporting it on their work income tax return, typically Type 941. If the credit surpasses the quantity 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 actually progressed over time. The very best course of action is to speak with a tax professional or go to the official IRS site for the most comprehensive and updated information relating to the ERC, consisting of any recent legislative changes or updates.
To get approved for the ERC, a business should satisfy one of the following requirements:.
Business operations were completely or partially suspended due to a government order related to COVID-19.
Business experienced a substantial decrease in gross invoices. For 2021, a substantial decline is specified as a 20% decline in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a considerable decline is defined as a 20% decrease 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, however there are some exceptions. Government entities and businesses that got a PPP loan might have restrictions on claiming the credit.
The process for claiming the ERC includes finishing the required types and including the credit on your employment income tax return (usually Type 941). The exact time it takes to process the credit can differ based upon numerous elements, including the complexity of your service and the work of the IRS. It’s suggested to speak with a tax expert for guidance particular to your situation.
There are several companies that can assist with the process of claiming the ERC. Some well-known companies that provide help with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the info provided here is based on basic knowledge and might not show the most current updates or modifications to the ERC. It’s important to seek advice from a tax expert or visit the official internal revenue service website for the most precise and up-to-date info concerning eligibility, declaring procedures, and offered support.
Less than 100. The credit is based if the company had 100 or less workers on average in 2019.
on salaries paid to all staff members whether they really worked or not. In other words, 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 employees on average in 2019.
enabled just for earnings paid to employees who did not work during the calendar quarter.
In both cases, “salaries” includes not simply money payments however also a portion of the expense of company.
supplied healthcare. Amending 941 For Employee Retention Credit
Employers can be immediately reimbursed for the credit by lowering the quantity of payroll taxes they.