Lets talk first about Employee Retention Credit 20 Percent :
Our team here what do these men doing everyone in this space is helping teach individuals about ERC and uh always offer a lovely breakfast and have individuals actually learn about the program we must head to the room where we have the ability 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 countless dollars actually Kevin hundreds of countless dollars so these are replicate copies of the letters that go to customers verifying that the check is on the way I indicate you know if you just start to look at some of these here I suggest this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I suggest it’s just I mean consider the number of actual customers 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 validated and the check is on the mail in the mail from the internal revenue service heading to the client so that’s how you’re able to track it you understand when you
receive this you understand the check is gone for sure which’s when they pay so they don’t pay anything up until they in fact get the money they don’t pay bottom line Wonder trust anything until this letter is confirmed the check is on the method they transfer it into their bank account and they can genuinely trust Wonder trust that the procedure has been ended up and the number of you believe you have actually processed because you started this we have to do with 35 000 of these for
about six billion dollars wow so plainly they understand what they’re doing and that’s what you need you require professionals 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 crucial today the employee retention credit which the majority of you have actually never ever become aware of I certainly hadn’t heard of it until very recently and discovered a lot about it since this is most likely the lowest expense of capital for any small business anywhere
anytime if you have workers between 5 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 Ideas they’re the biggest processor of these ERC credits this is a 170 page program so it’s not easy this isn’t like PPP we simply contact your bank manager and state give 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 have actually become yes the Ambassador and paid spokesperson for this I like this program it’s going away soon you got to discover everything about it let’s talk staff member 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 used organizations 3 opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly everyone it makes a big difference 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 fine go on sorry I simply have to ensure we got that point I imply that’s a huge distinction a loan versus money cash I like cash 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 initial cares Act is the ERC and yes Kevin it is a gorgeous tough check in the mail where you get actual money from the IRS all right so let’s talk about how it works because it sounds like to me if it’s a if it’s employee retention credit that individual needed to be an employee so I’m going to make the Presumption this cash is not for the owner not for people on the cap table not for investors it’s for workers right you had to have owned a service however 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 eligible so you have to be on payroll in 2020 on the W-2 and you have to be on payroll for the very 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 two 3 and 4 of 2020 and you had quarters one 2 and 3 of 2021. alright so that’s how it’s determined you need to be on the W-2 during that duration now let’s talk my preferred part money how much can you return per employee that was on a W-2 in those 6 quarters so the computation in 2020 to be specific Kevin is 50 of the staff member’s salary to an optimum of 5 thousand dollars per employee for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the staff member’s income to a maximum of 7 thousand per quarter how did that take place um they just altered the rules in.
2021 versus since the turmoil 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 up to five thousand Max and after that what occurs 21 000 Max in 2021 oh that’s how you create twenty six 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 lot of cash it is now there’s a caution here the PPP cash would have to be minimized from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan 2 you would decrease the 26 000 so what we’re seeing on average Kevin is if you took PPP cash somewhere around 10 thousand dollars a person so let’s state hypothetically you owned a dining establishment in New york city City where I’m from and you had a hundred employees and you took PPP money you would still get a million dollar in the mail from the IRS so it’s big clearly now the huge concern is why does nobody know about this since appearance when I initially heard about this when I initially met Josh you understand I’ve got lots of investments in great deals of companies I’m a major supporter for entrepreneurship in America and make numerous lots of investments in entrepreneurs of which numerous suffered through the pandemic when I first found out about this I called BS I don’t believe it because 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 been worthy of and we used them carefully to stay alive during the pandemic so when I became aware of this I stated 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 learn about it I indicate that’s how you know that’s how misinformation is that there’s no details out there then a bunch of people informed me well you can’t get it because you took the PPP also not real so let’s ask Josh why does nobody learn about the worker retention credit you know what’s interesting you’re discussing 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 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 procedure procedure that’s all um and here there was chaos due to the fact that remember in the initial cares act you could not do both programs so if you had done PPP you might not do ERC in the original program and when they altered the law in 2021 the banks were not doing ERC because 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 actually he or she’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 company your accountant no your accountant’s never done this prior to unless you have an account that entered into this organization and bottom line my company Kevin has actually been in business given that 2009 and we have actually been dealing with the federal government and the state government to recuperate cash for Fortune 500 Fortune 1000 business so a great deal of our huge huge business customers have actually worked with bottom line to recover other federal government programs we’ve done sales tax and use tax joblessness tax work opportunity tax credits research and development tax credits unclaimed property real estate tax all of these other federal government programs.
The worker retention tax credit is a broad based refundable tax credit developed to encourage.
companies to keep workers on their payroll. The credit is 50% of as much as $10,000 in earnings paid by an.
company whose service is totally or partially suspended because of COVID-19 or whose gross receipts.
decrease by more than 50%.
1. The credit is offered to all companies despite size consisting of tax exempt organizations. There are.
only 2 exceptions: (1) state and city governments and their instrumentalities and (2) little.
organizations who take Small company Loans.
2. To certify, the employer has to satisfy one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the employer’s organization is completely or partially suspended by federal government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross receipts are below 50% of the comparable quarter in 2019. Once the.
company’s gross invoices go above 80% of a similar quarter in 2019 they no longer qualify.
after completion of that quarter.
Estimation of the Credit.
The amount of the credit is 50% of the certifying salaries paid up to $10,000 in total.
It works for earnings paid after March 13th and before December 31, 2020.
The definition of qualifying incomes varies by whether an employer had, usually, more or less than.
100 workers in 2019.
Business that concentrate on ERC filing help normally supply competence and support to assist organizations navigate the intricate process of declaring the credit. They can provide numerous services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit 20 Percent
Eligibility Assessment: These companies will evaluate your company’s eligibility for the ERC based on factors such as your industry, profits, and operations. If you fulfill the requirements for the credit and determine the optimum credit amount you can claim, they can help identify.
Documents and Estimation: ERC filing services will assist in collecting the required documents, such as payroll records and financial declarations, to support your claim. They will likewise assist calculate the credit quantity based on qualified earnings and other certifying costs.
Retroactive Claim Review: If you are qualified to claim the ERC for previous quarters, these companies can examine your past payroll records and financials to determine prospective chances for retroactive credits. They can help you amend prior tax returns to declare these refunds.
Filing Assistance: Companies focusing on ERC filings will prepare and submit the required forms and paperwork on your behalf. This includes completing Kind 941 or any other required tax return.
Compliance and Updates: ERC guidelines and guidance have actually evolved in time. These business remain updated with the latest changes and make sure that your filings abide by the most existing standards. They can also supply ongoing support if the internal revenue service demands extra details or performs an audit related to your ERC claim.
It is necessary to research study and vet any business using ERC filing assistance to ensure their trustworthiness and competence. Search for established firms with experience in tax and payroll services, or consider reaching out to trusted accounting companies or tax experts who provide ERC filing support.
Remember that while these business can supply valuable help, it’s constantly an excellent idea to have a fundamental understanding of the ERC requirements and process yourself. This will help you make informed choices and make sure accurate filings.
The Worker 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 services to maintain and pay their workers during the pandemic, even if their operations have actually been impacted.
Here are some key points about the ERC:.
Eligibility: The ERC is readily available to qualified employers, consisting of for-profit companies, tax-exempt companies, and particular governmental entities. To certify, companies should fulfill one of two requirements:.
Business operations were completely or partially suspended due to a government order related to COVID-19.
The business experienced a considerable decrease in gross invoices. As discussed previously, for 2021, a substantial decrease is defined as a 20% decline in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a significant decrease is specified as a 20% decrease in gross invoices compared to the 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 employer’s share of Social Security taxes. The credit quantity amounts to a portion (as much as 70%) of certified earnings paid to workers, including certain health plan expenditures. The maximum credit per worker is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: At first, services that got a Paycheck Defense Program (PPP) loan were not eligible for the ERC. However, legislation passed in late 2020 and extended in 2021 allows services to claim the ERC even if they received a PPP loan. However, the same salaries can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively expanded and improved, permitting qualified employers to declare the credit for certified salaries paid as far back as March 13, 2020. This retroactive provision supplies an opportunity for services to modify prior-year tax returns and get refunds.
Claiming the Credit: Employers can claim the ERC by reporting it on their employment tax returns, usually Form 941. If the credit exceeds the amount of employment taxes owed, the excess can be reimbursed to the company.
It is essential to note that the ERC arrangements and eligibility criteria have actually developed over time. The very best strategy is to speak with a tax professional or check out the main internal revenue service website for the most up-to-date and in-depth info relating to the ERC, consisting of any recent legislative changes or updates.
To qualify for the ERC, a business should fulfill one of the following criteria:.
Business operations were totally or partly suspended due to a government order related to COVID-19.
The business experienced a considerable decrease in gross receipts. For 2021, a considerable decline is defined as a 20% decrease in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a substantial decline is specified as a 20% decline in gross invoices 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 offered to organizations of all sizes, consisting of tax-exempt companies, but there are some exceptions. For example, government entities and businesses that received a PPP loan might have limitations on declaring the credit.
The procedure for declaring the ERC involves completing the required types and including the credit on your work income tax return (usually Kind 941). The exact time it requires to process the credit can differ based upon numerous elements, including the intricacy of your organization and the workload of the internal revenue service. It’s suggested to seek advice from a tax professional for guidance particular to your circumstance.
There are a number of business that can help with the procedure of declaring the ERC. Some well-known companies that use support with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the information supplied here is based on basic understanding and might not reflect the most recent updates or changes to the ERC. It is necessary to speak with a tax professional or check out the main IRS website for the most updated and precise details relating to eligibility, claiming treatments, and readily available help.
Less than 100. If the employer had 100 or less staff members on average in 2019, then the credit is based.
on incomes paid to all employees whether they really worked or not. In other words, even if the.
employees worked full time and made money 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.
allowed just for incomes paid to staff members who did not work throughout the calendar quarter.
In both cases, “incomes” includes not just money payments but likewise a portion of the cost of company.
provided healthcare. Employee Retention Credit 20 Percent
Companies can be right away repaid for the credit by reducing the quantity of payroll taxes they.