Lets talk first about Do Tips Count For Employee Retention Credit :
Our team here what do these men doing everyone in this room is assisting teach people about ERC and uh constantly supply a beautiful breakfast and have people truly discover the program we need 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 countless dollars literally Kevin numerous millions of dollars so these are duplicate copies of the letters that go to clients validating that the check is on the method I suggest you know if you simply begin to 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 imply it’s simply I imply think of how many real clients that went through the program yeah this is the very end this is the celebration at the end when the check is confirmed the numbers are confirmed and the check is on the mail in the mail from the internal revenue service heading to the client so that’s how you have the ability to track it you know when you
get this you know the check is gone for sure which’s when they pay so they don’t pay anything up until they in fact get the cash they don’t pay bottom line Wonder trust anything till this letter is validated the check is on the method they transfer it into their checking account and they can really rely on Wonder trust that the process has been ended up and how many you believe you’ve 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 require 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 Wonderful here you’re at my YouTube channel we’re speaking about something really essential today the worker retention credit which most of you have never heard of I certainly had not heard of it till extremely recently and found out a lot about it because this is most likely the most affordable expense of capital for any small company anywhere
anytime if you have workers in between 5 and five hundred so I have actually got the expert 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 phone your bank supervisor and state give 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’ve ended up being yes the Ambassador and paid representative for this I love this program it’s disappearing very soon you got to find out everything about it let’s talk employee retention credit Josh Fox what is an ERC let’s simply begin there so throughout the Trump Administration when President Trump was enacted they developed the cares Act and the cares act provided services three chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and almost everyone it makes a huge distinction 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 ensure we got that point I mean that’s a big difference a loan versus cash money 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 initial cares Act is the ERC and yes Kevin it is a lovely hard check in the mail where you get real money from the IRS all right so let’s speak about how it works because it seems like to me if it’s a if it’s employee retention credit that person needed to be a worker so I’m going to make the Assumption 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 company but it’s based upon you having W-2 staff members in America not 10.99. 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 six months of 2021 on the W-2 correct so there were 6 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 three of 2021. alright so that’s how it’s determined you need to be on the W-2 during that period now let’s talk my preferred part money how much can you get back per employee that was on a W-2 in those 6 quarters so the calculation in 2020 to be exact Kevin is 50 of the staff member’s wage to a maximum of 5 thousand dollars per employee for the year of 2020 and in 2021 the numbers escalated to 70 of the employee’s wage to an optimum of 7 thousand per quarter how did that happen um they just altered the rules in.
2021 versus since the mayhem of the pandemic so they wanted to even get more to keep those workers 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 six thousand twenty one thousand to twenty twenty one plus five thousand in twenty twenty that’s twenty 6 thousand dollars per staff member that is since that’s a lot of cash it is now there’s a caveat here the PPP money would need to be reduced from the twenty six thousand dollars so if you took PPP loan one and PPP loan two you would reduce the 26 000 so what we’re seeing typically Kevin is if you took PPP money somewhere around ten thousand dollars a person so let’s say hypothetically you owned a dining establishment in New York City where I’m from and you had a hundred workers and you took PPP cash you would still get a million dollar in the mail from the IRS so it’s big certainly now the huge question is why does no one know about this since appearance when I initially heard about this when I initially satisfied Josh you understand I’ve got lots of investments in great deals of companies I’m a significant supporter for entrepreneurship in America and make lots of lots of financial investments in business owners of which numerous suffered through the pandemic when I initially found out about this I called BS I do not believe it because I utilize the PPP we went through the cash 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 should have 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 called to my politician pals Governor Senators they didn’t know about it I mean that’s how you know that’s how false information is that there’s no details out there then a lot of people informed me well you can’t get it because you took the PPP likewise not true so let’s ask Josh why does nobody learn about the worker retention credit you know what’s fascinating you’re speaking about the banks Kevin because in the PPP loan procedure the federal government made it extremely 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 process that’s all um and here there was turmoil due to the fact that keep in mind in the original cares act you could not do both programs so if you had done PPP you could not do ERC in the original program and when they changed the law in 2021 the banks were refraining from doing ERC due to the fact that 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 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 a few of them are doing it as a payroll business your accountant no your accountant’s never done this before unless you have an account that went into this service and bottom line my firm Kevin has been in business because 2009 and we’ve been working with the federal government and the state federal government to recuperate money for Fortune 500 Fortune 1000 companies so a lot of our big huge corporate customers have actually dealt with bottom line to recover other government programs we’ve done sales tax and use tax joblessness tax work chance tax credits research and development tax credits unclaimed home property tax all of these other federal government programs.
The staff member retention tax credit is a broad based refundable tax credit designed to encourage.
companies to keep employees on their payroll. The credit is 50% of approximately $10,000 in earnings paid by an.
Because of COVID-19 or whose gross receipts, employer whose service is totally or partially suspended.
decline by more than 50%.
1. The credit is offered to all employers regardless of size consisting of tax exempt organizations. There are.
only two exceptions: (1) state and city governments and their instrumentalities and (2) small.
services who take Small company Loans.
2. To certify, the company needs to fulfill one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the company’s service is totally or partly suspended by federal government order due to COVID-19.
during the calendar quarter or.
o the company’s gross receipts are listed below 50% of the comparable quarter in 2019. Once the.
company’s gross receipts go above 80% of an equivalent quarter in 2019 they no longer certify.
after the end of that quarter.
Calculation of the Credit.
The quantity of the credit is 50% of the qualifying wages paid up to $10,000 in overall.
It works for salaries paid after March 13th and prior to December 31, 2020.
The meaning of certifying incomes varies by whether a company had, typically, more or less than.
100 employees in 2019.
Companies that concentrate on ERC filing support normally offer expertise and support to help services browse the complicated process of claiming the credit. They can provide numerous services, consisting of:.
How is the employee retention credit calculated? Do Tips Count For Employee Retention Credit
Eligibility Assessment: These business will assess your service’s eligibility for the ERC based upon factors such as your industry, income, and operations. If you meet the requirements for the credit and identify the optimum credit amount you can declare, they can help determine.
Paperwork and Computation: ERC filing services will assist in collecting the needed documentation, such as payroll records and financial declarations, to support your claim. They will likewise help compute the credit quantity based on qualified incomes and other qualifying expenses.
Retroactive Claim Evaluation: If you are eligible to declare the ERC for previous quarters, these business can evaluate your previous payroll records and financials to determine potential chances for retroactive credits. They can help you change prior income tax return to declare these refunds.
Filing Support: Companies focusing on ERC filings will prepare and submit the essential kinds and documents on your behalf. This includes finishing Kind 941 or any other necessary tax forms.
Compliance and Updates: ERC regulations and guidance have evolved with time. These companies remain updated with the most recent modifications and guarantee that your filings comply with the most existing standards. If the Internal revenue service demands extra details or carries out an audit related to your ERC claim, they can also offer continuous support.
It is necessary to research and veterinarian any business providing ERC filing assistance to guarantee their credibility and proficiency. Try to find established companies with experience in tax and payroll services, or consider connecting to trusted accounting firms or tax specialists who offer ERC submitting support.
Remember that while these business can provide valuable help, it’s always a great concept to have a basic understanding of the ERC requirements and procedure 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 measures. The objective of the ERC is to encourage companies to retain and pay their employees during the pandemic, even if their operations have actually been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is readily available to qualified companies, consisting of for-profit companies, tax-exempt companies, and particular governmental entities. To certify, companies must meet 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 substantial decline in gross invoices. As discussed earlier, for 2021, a substantial decline is defined as a 20% decrease in gross receipts 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 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 employer’s share of Social Security taxes. The credit amount is equal to a percentage (approximately 70%) of qualified incomes paid to workers, consisting of certain health plan expenditures. 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 received an Income Protection Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 allows organizations to declare the ERC even if they got a PPP loan. However, the very same earnings can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively broadened and boosted, permitting qualified companies to declare the credit for qualified earnings paid as far back as March 13, 2020. This retroactive arrangement supplies an opportunity for organizations to amend prior-year income tax return and receive refunds.
Claiming the Credit: Companies can claim the ERC by reporting it on their employment income tax return, normally Form 941. The excess can be refunded to the employer if the credit goes beyond the amount of work taxes owed.
It is very important to keep in mind that the ERC provisions and eligibility criteria have developed over time. The very best course of action is to talk to a tax professional or visit the official IRS website for the most comprehensive and updated info regarding the ERC, consisting of any recent legal modifications or updates.
To qualify for the ERC, an organization needs to satisfy among the following 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 invoices. For 2021, a significant decline is defined as a 20% decrease in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a substantial decrease is defined as a 20% decrease in gross receipts compared to the same quarter in 2019, or a 20% decline in gross invoices compared to the instantly preceding quarter.
The ERC is available to organizations of all sizes, including tax-exempt organizations, however there are some exceptions. Federal government entities and businesses that received a PPP loan might have constraints on claiming the credit.
The procedure for claiming the ERC involves completing the needed kinds and consisting of the credit on your employment tax return (generally Kind 941). The exact time it requires to process the credit can differ based on a number of aspects, consisting of the complexity of your company and the workload of the IRS. It’s suggested to seek advice from a tax professional for guidance particular to your circumstance.
There are several business that can help with the procedure of declaring the ERC. Some popular companies that provide assistance with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the details provided here is based on basic understanding and might not show the most recent updates or modifications to the ERC. It is necessary to speak with a tax professional or check out the main IRS website for the most current and precise information regarding eligibility, declaring treatments, and readily available help.
Less than 100. The credit is based if the company had 100 or less staff members on average in 2019.
on salaries paid to all staff members whether they in fact worked or not. To put it simply, even if the.
workers worked full time and earned money for full time work, the company still gets the credit.
Greater than 100. The credit is if the employer had more than 100 employees on average in 2019.
allowed just for incomes paid to workers who did not work during the calendar quarter.
In both cases, “wages” includes not just cash payments however also a portion of the expense of employer.
supplied health care. Do Tips Count For Employee Retention Credit
Companies can be right away reimbursed for the credit by minimizing the amount of payroll taxes they.