Lets talk first about Employee Retention Credit 2020 Filing Deadline :
Our team here what do these people doing everybody in this room is assisting teach people about ERC and uh constantly provide a lovely breakfast and have people really find out about the program we must head to the space where we have the ability to show a few of the checks that we are getting for business and I ‘d like 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 validating that the check is on the way I imply you understand if you just begin to take a look at a few of these here I imply this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I indicate it’s just I indicate consider 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 confirmed the numbers are confirmed and the check is on the mail in the mail from the internal revenue service heading to the consumer so that’s how you’re able to track it you know when you
get this you understand the check is opted for sure which’s when they pay so they don’t pay anything till they actually get the cash they do not pay bottom line Wonder trust anything until this letter is validated the check is on the way they transfer it into their savings account and they can truly rely on Wonder trust that the process has been ended up and how many you believe you’ve processed because you began this we have to do with 35 000 of these for
about 6 billion dollars wow so clearly they understand what they’re doing and that’s what you need 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 Wonderful here you’re at my YouTube channel we’re speaking about something actually essential today the employee retention credit which most of you have never become aware of I definitely hadn’t heard of it until extremely just recently and found out a lot about it due to the fact that this is probably the most affordable cost of capital for any small company anywhere
anytime if you have staff members in between 5 and five hundred so I have actually 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 simply call 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 tell 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 very soon you got to learn all about it let’s talk staff member retention credit Josh Fox what is an ERC let’s just start there so during the Trump Administration when President Trump was enacted they created the cares Act and the cares act used companies 3 opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically everyone it makes a huge difference right there 2 of them are loans and one’s a refund precisely so the ERC is a refund that’s.
fix the money cash payroll tax refund alright go on sorry I just have to ensure we got that point I imply that’s a huge difference a loan versus money money I like cash cash that’s what we’re discussing okay 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 cash from the internal revenue service all right so let’s speak about how it works due to the fact that it sounds 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 cash is not for the owner not for individuals on the cap table not for shareholders it’s for staff members right you had to have actually owned an organization but it’s based on you having W-2 staff members 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 very first 6 months of 2021 on the W-2 appropriate so there were 6 quarters the program was open well walk us through the six quarters so you had quarters 2 3 and four of 2020 and you had quarters one 2 and 3 of 2021. alright so that’s how it’s measured you need to be on the W-2 throughout that period now let’s talk my preferred part cash how much can you get back per staff member that was on a W-2 in those six quarters so the calculation in 2020 to be specific Kevin is 50 of the staff member’s income to a maximum of five 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 seven thousand per quarter how did that occur um they just changed the rules in.
2021 versus since the turmoil 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 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 5 thousand in twenty twenty that’s twenty 6 thousand dollars per employee that is because that’s a great deal of money it is now there’s a caveat here the PPP money would need 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 on average Kevin is if you took PPP cash someplace around 10 thousand dollars a person so let’s state hypothetically you owned a restaurant in New York City where I’m from and you had a hundred employees and you took PPP cash you would still get a million dollar in the mail from the IRS so it’s substantial undoubtedly now the big question is why does nobody know about this since look when I first found out about this when I first fulfilled Josh you know I have actually got great deals of financial investments in lots of business 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 do not think it due to the fact that I use the PPP we went through the money center Banks to get it it was extremely easy to do we had our CEOs call the banks they got their loans and that were well been worthy of and we used them carefully to stay alive during the pandemic so when I found out about this I said nah it can’t be true however when I dug around I even called to my politician buddies Guv Senators they didn’t know about it I mean that’s how you know that’s how false information is that there’s no info out there then a bunch of individuals told me well you can’t get it due to the fact that you took the PPP also not real so let’s ask Josh why does nobody know about the employee retention credit you understand what’s fascinating you’re talking about the banks Kevin due to the fact that in the PPP loan process 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 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 turmoil due to the fact that keep in mind in the initial cares act you could not do both programs so if you had actually done PPP you could not do ERC in the original 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 government never ever made it clear to anyone 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 do not 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 prior to unless you have an account that went into this organization and bottom line my company Kevin has actually stayed in business considering that 2009 and we have actually been dealing with the federal government and the state government to recover money for Fortune 500 Fortune 1000 business so a great deal of our big big corporate clients have worked with bottom line to recover other federal government programs we have actually done sales tax and utilize tax joblessness tax work chance tax credits research and development tax credits unclaimed home property tax all of these other government programs.
The employee 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 wages paid by an.
employer whose company is fully or partially suspended because of COVID-19 or whose gross receipts.
decrease by more than 50%.
1. The credit is offered to all employers regardless of size consisting of tax exempt companies. There are.
only two exceptions: (1) state and city governments and their instrumentalities and (2) little.
companies who take Small Business Loans.
2. To certify, the employer needs to satisfy one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the company’s service is totally or partly suspended by government order due to COVID-19.
during the calendar quarter or.
o the company’s gross invoices are below 50% of the comparable quarter in 2019. As soon as the.
company’s gross receipts exceed 80% of a comparable quarter in 2019 they no longer qualify.
after the end of that quarter.
Calculation of the Credit.
The quantity of the credit is 50% of the qualifying earnings paid up to $10,000 in total.
It works for wages paid after March 13th and before December 31, 2020.
The definition of qualifying wages differs by whether a company had, usually, more or less than.
100 staff members in 2019.
Companies that focus on ERC filing help generally supply competence and assistance to help organizations browse the complicated process of declaring the credit. They can offer numerous services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit 2020 Filing Deadline
Eligibility Evaluation: These companies will assess your service’s eligibility for the ERC based on elements such as your market, revenue, and operations. If you fulfill the requirements for the credit and determine the maximum credit quantity you can declare, they can help determine.
Paperwork and Estimation: ERC filing services will assist in collecting the needed documents, such as payroll records and financial declarations, to support your claim. They will also assist determine the credit quantity based upon qualified incomes and other certifying costs.
Retroactive Claim Evaluation: If you are qualified to declare the ERC for previous quarters, these companies can examine your previous payroll records and financials to identify potential chances for retroactive credits. They can help you amend previous income tax return to declare these refunds.
Filing Support: Business specializing in ERC filings will prepare and send the necessary kinds and paperwork in your place. This includes finishing Type 941 or any other necessary tax forms.
Compliance and Updates: ERC guidelines and assistance have actually developed gradually. These companies remain upgraded with the most recent changes and make sure that your filings adhere to the most existing guidelines. If the Internal revenue service requests extra details or performs an audit related to your ERC claim, they can also provide continuous assistance.
It is very important to research and vet any business providing ERC filing help to guarantee their credibility and know-how. Search for established firms with experience in tax and payroll services, or consider connecting to trusted accounting companies or tax experts who provide ERC filing support.
Keep in mind that while these companies can offer valuable help, it’s always a great idea to have a standard understanding of the ERC requirements and process yourself. This will assist you make notified decisions and make sure accurate filings.
The Employee 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 services to maintain and pay their employees throughout the pandemic, even if their operations have been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is offered to eligible employers, including for-profit organizations, tax-exempt companies, and specific governmental entities. To qualify, employers need to satisfy one of two criteria:.
Business operations were completely or partly suspended due to a federal government order related to COVID-19.
Business experienced a considerable decline in gross receipts. As mentioned previously, for 2021, a considerable decline is defined as a 20% decrease in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a substantial decline is defined as a 20% decrease in gross invoices compared to the exact same quarter in 2019, or a 20% decrease 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 quantity is equal to a percentage (up to 70%) of qualified incomes paid to employees, consisting of particular health insurance costs. The optimum credit per employee is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: At first, businesses that got a Paycheck Defense Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 enables services to claim the ERC even if they got a PPP loan. However, the very same salaries can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively expanded and boosted, permitting eligible employers to declare the credit for certified salaries paid as far back as March 13, 2020. This retroactive provision provides an opportunity for businesses to change prior-year tax returns and receive refunds.
Claiming the Credit: Companies can declare the ERC by reporting it on their employment income tax return, usually Kind 941. If the credit goes beyond the amount of work taxes owed, the excess can be refunded to the employer.
It is necessary to keep in mind that the ERC arrangements and eligibility requirements have actually evolved in time. The very best course of action is to speak with a tax expert or go to the main IRS website for the most detailed and updated information regarding the ERC, including any current legal changes or updates.
To qualify for the ERC, a business should satisfy one of the following criteria:.
The 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. For 2021, a significant decrease is specified as a 20% decline in gross invoices compared to the very 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 instantly preceding quarter.
The ERC is available to companies of all sizes, consisting of tax-exempt companies, but there are some exceptions. Federal government entities and businesses that got a PPP loan may have restrictions on declaring the credit.
The process for declaring the ERC involves finishing the required kinds and consisting of the credit on your work income tax return (typically Type 941). The exact time it requires to process the credit can differ based on a number of elements, consisting of the intricacy of your business and the work of the internal revenue service. It’s recommended to speak with a tax professional for guidance specific to your situation.
There are numerous business that can assist with the process of declaring the ERC. Some widely known business that provide help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the information offered here is based on basic knowledge and might not reflect the most recent updates or modifications to the ERC. It is very important to talk to a tax expert or go to the official IRS website for the most updated and accurate info relating to eligibility, declaring treatments, and offered support.
Less than 100. The credit is based if the employer had 100 or fewer workers on average in 2019.
on wages paid to all workers whether they actually 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.
enabled just for incomes paid to employees who did not work during the calendar quarter.
In both cases, “wages” consists of not simply money payments but likewise a part of the cost of employer.
provided healthcare. Employee Retention Credit 2020 Filing Deadline
Companies can be instantly repaid for the credit by lowering the amount of payroll taxes they.