Lets talk first about Claiming Employee Retention Credit Retroactively :
Our team here what do these people doing everyone in this room is helping teach individuals about ERC and uh constantly supply a stunning breakfast and have individuals really learn more 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 want to see that what is this this is uh hundreds of millions of 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 method I suggest you understand if you simply begin to take a look at some of these here I indicate 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 how many real customers that went through the program yeah this is the very end this is the celebration at the end when the check is verified the numbers are validated and the check is on the mail in the mail from the IRS heading to the customer so that’s how you have the ability to track it you know when you
get this you know the check is chosen 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 up until this letter is validated the check is on the way they deposit it into their checking account and they can really trust Wonder trust that the process has actually been finished and how many you believe you have actually processed because you began this we have to do with 35 000 of these for
about 6 billion dollars wow so plainly they know what they’re doing and that’s what you require you need specialists 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 speaking about something actually essential today the employee retention credit which the majority of you have never become aware of I definitely had not heard of it up until very just recently and discovered a lot about it due to the fact that this is probably the lowest expense of capital for any small business anywhere
anytime if you have workers between 5 and five hundred so I’ve got the specialist with me this is Josh Fox he’s the founder and CEO of bottom line Principles 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 phone 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 inform all of us about it and how to get it and why I have actually become yes the Ambassador and paid representative for this I enjoy this program it’s going away soon you got to learn everything about it let’s talk staff member retention credit Josh Fox what is an ERC let’s just begin there so during the Trump Administration when President Trump was enacted they created the cares Act and the cares act offered businesses 3 chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically everyone it makes a big difference right there 2 of them are loans and one’s a refund exactly so the ERC is a refund that’s.
remedy the cash cash payroll tax refund alright go on sorry I simply have to make sure we got that point I mean that’s a huge distinction a loan versus cash cash I like cash money that’s what we’re talking about all right 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 hard check in the mail where you get actual cash from the IRS all right so let’s speak about how it works due to the fact that it seems 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 people on the cap table not for investors it’s for workers right you needed to have actually owned a business however 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 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 right so there were six quarters the program was open well stroll us through the six quarters so you had quarters 2 three and 4 of 2020 and you had quarters one 2 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 cash how much can you get back per employee that was on a W-2 in those six quarters so the estimation in 2020 to be specific Kevin is 50 of the staff member’s wage to a maximum of 5 thousand dollars per worker for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the employee’s salary to an optimum of seven thousand per quarter how did that occur um they just altered the rules in.
2021 versus because the chaos of the pandemic so they wished to even get more to keep those staff members on payroll 100 so if you can get 5 000 per person Max in twenty that was 50 in 2020 as much as five thousand Max and then what takes place 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 six thousand dollars per employee that is since that’s a great deal of cash it is now there’s a caveat here the PPP cash would have to be reduced from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan two you would lower 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 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 internal revenue service so it’s huge obviously now the huge concern is why does nobody understand about this because appearance when I initially heard about this when I first fulfilled Josh you know I’ve got great deals of financial investments in lots of companies I’m a significant supporter for entrepreneurship in America and make lots of many financial investments in business owners of which lots of suffered through the pandemic when I first heard about 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 which were well been worthy of and we used them carefully to survive during the pandemic so when I found out about this I stated nah it can’t be true however when I dug around I even contacted us to my politician pals Governor Senators they didn’t understand about it I imply that’s how you know that’s how false information is that there’s no information out there then a lot of individuals told me well you can’t get it since you took the PPP also not true so let’s ask Josh why does no one understand about the employee retention credit you understand what’s interesting you’re talking about the banks Kevin because in the PPP loan process the federal government made it very clear that if you wanted 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 just procedure procedure that’s all um and here there was chaos due to the fact that keep in mind in the original cares act you might not do both programs so if you had done PPP you might refrain from doing ERC in the original program and when they changed 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 anybody about how to.
do this does your CFO know how to do this not truly she or he’s never ever done it previously do the banks do it nope the banks don’t do it the payroll business yeah a few of them are doing it as a payroll business your accountant no your accounting professional’s never done this prior to unless you have an account that entered into this service and bottom line my company Kevin has been in business because 2009 and we’ve been dealing with the federal government and the state government to recuperate cash for Fortune 500 Fortune 1000 business so a lot of our big huge business clients have actually 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 property tax all of these other federal government programs.
The employee retention tax credit is a broad based refundable tax credit designed to motivate.
companies to keep workers on their payroll. The credit is 50% of approximately $10,000 in wages paid by an.
company whose business is completely or partially suspended because of COVID-19 or whose gross invoices.
decrease by more than 50%.
1. The credit is offered to all employers no matter size including tax exempt companies. There are.
just two exceptions: (1) state and local governments and their instrumentalities and (2) small.
organizations who take Small company Loans.
2. To qualify, the employer needs to fulfill one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the employer’s service is totally or partly suspended by government order due to COVID-19.
throughout the calendar quarter or.
o the employer’s gross receipts are below 50% of the comparable quarter in 2019. Once the.
employer’s gross invoices exceed 80% of an equivalent quarter in 2019 they no longer certify.
after the end of that quarter.
Computation of the Credit.
The amount of the credit is 50% of the certifying salaries paid up to $10,000 in overall.
It works for wages paid after March 13th and before December 31, 2020.
The definition of qualifying wages varies by whether a company had, usually, basically than.
100 staff members in 2019.
Business that concentrate on ERC filing help typically provide expertise and assistance to assist organizations navigate the complex process of declaring the credit. They can offer numerous services, consisting of:.
How is the employee retention credit calculated? Claiming Employee Retention Credit Retroactively
Eligibility Evaluation: These companies will examine your organization’s eligibility for the ERC based upon 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 figure out.
Paperwork and Computation: ERC filing services will help in collecting the necessary documents, such as payroll records and monetary statements, to support your claim. They will likewise help determine the credit amount based on eligible earnings and other qualifying expenditures.
Retroactive Claim Evaluation: If you are qualified to claim the ERC for prior quarters, these companies can review your previous payroll records and financials to determine possible chances for retroactive credits. They can help you modify prior tax returns to claim these refunds.
Filing Help: Companies concentrating on ERC filings will prepare and submit the essential kinds and paperwork in your place. This includes finishing Form 941 or any other necessary tax forms.
Compliance and Updates: ERC regulations and assistance have progressed gradually. These companies stay updated with the most recent changes and make sure that your filings abide by the most current standards. If the Internal revenue service requests additional details or conducts an audit associated to your ERC claim, they can likewise offer continuous support.
It is very important to research study and veterinarian any business using ERC filing support to ensure their trustworthiness and proficiency. Look for established firms with experience in tax and payroll services, or think about connecting to relied on accounting companies or tax professionals who provide ERC filing assistance.
Keep in mind that while these business can offer valuable help, it’s always a great concept to have a fundamental understanding of the ERC requirements and process yourself. This will help you make notified choices and guarantee accurate filings.
The Employee Retention Credit (ERC) is a refundable tax credit introduced by the U.S. federal government as part of COVID-19 relief steps. The objective of the ERC is to motivate businesses to retain and pay their workers throughout 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, consisting of for-profit organizations, tax-exempt organizations, and certain governmental entities. To qualify, employers need to satisfy one of two requirements:.
The business operations were totally or partially suspended due to a federal government order related to COVID-19.
The business experienced a considerable decline in gross invoices. As pointed out earlier, for 2021, a substantial decrease is defined as a 20% decrease in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a significant decline is specified as a 20% decrease in gross receipts compared to the 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 employer’s share of Social Security taxes. The credit quantity amounts to a percentage (approximately 70%) of qualified wages paid to workers, consisting of specific health insurance costs. 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 Defense Program (PPP) loan were not qualified for the ERC. However, legislation passed in late 2020 and extended in 2021 permits companies to claim the ERC even if they received a PPP loan. Nevertheless, the very same salaries can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively broadened and enhanced, permitting eligible employers to claim the credit for certified salaries paid as far back as March 13, 2020. This retroactive provision offers a chance for organizations to change prior-year income tax return and receive refunds.
Claiming the Credit: Companies can declare the ERC by reporting it on their work tax returns, generally Kind 941. The excess can be refunded to the employer if the credit goes beyond the amount of employment taxes owed.
It is necessary to note that the ERC arrangements and eligibility criteria have progressed in time. The very best strategy is to consult with a tax expert or visit the main internal revenue service website for the most in-depth and updated details regarding the ERC, including any recent legislative modifications or updates.
To receive the ERC, a service should meet among the following criteria:.
The business operations were totally or partially suspended due to a government order related to COVID-19.
The business experienced a significant decrease in gross receipts. For 2021, a substantial decline is defined as a 20% decrease in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a considerable decline 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 immediately preceding quarter.
The ERC is available to organizations of all sizes, including tax-exempt organizations, but there are some exceptions. For example, government entities and services that got a PPP loan may have restrictions on declaring the credit.
The process for claiming the ERC involves finishing the required kinds and including the credit on your employment tax return (normally Type 941). The exact time it requires to process the credit can vary based upon numerous factors, consisting of the complexity of your service and the work of the IRS. It’s suggested to speak with a tax expert for assistance specific to your scenario.
There are numerous business that can help with the process of declaring the ERC. Some well-known business that use help with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the details supplied here is based on general understanding and may not reflect the most current updates or modifications to the ERC. It is very important to speak with a tax professional or check out the official internal revenue service site for the most up-to-date and precise details relating to eligibility, claiming procedures, and offered help.
Less than 100. The credit is based if the employer had 100 or less workers on average in 2019.
on wages paid to all staff members whether they really worked or not. Simply put, even if the.
staff members worked full time and made money for full-time work, the company still gets the credit.
Greater than 100. The credit is if the company had more than 100 employees on average in 2019.
allowed only for earnings paid to staff members who did not work throughout the calendar quarter.
In both cases, “earnings” consists of not just money payments however also a part of the cost of employer.
provided healthcare. Claiming Employee Retention Credit Retroactively
Employers can be immediately repaid for the credit by reducing the amount of payroll taxes they.