Lets talk first about Employee Retention Credit 2021 And Ppp Loan :
Our group here what do these guys doing everybody in this space is helping teach individuals about ERC and uh always offer a beautiful breakfast and have individuals really learn about the program we must head to the space where we have the ability to show some of the checks that we are getting for companies 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 customers confirming that the check is on the method I indicate you understand if you simply start to look at some of these here I imply this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I suggest it’s simply I imply 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 verified 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 understand when you
receive this you know the check is chosen sure and that’s when they pay so they do not pay anything until they in fact get the money 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 genuinely rely on Wonder trust that the process has been finished and how many you believe you’ve processed given that you started this we have to do with 35 000 of these for
about six billion dollars wow so clearly they understand what they’re doing and that’s what you need you require 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 talking about something actually essential today the worker retention credit which the majority of you have never ever become aware of I certainly had not heard of it up until extremely just recently and discovered a lot about it because this is most likely the most affordable expense of capital for any small business anywhere
anytime if you have workers between five 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 Ideas they’re the largest processor of these ERC credits this is a 170 page program so it’s difficult this isn’t like PPP we simply call your bank supervisor and state provide me a loan it doesn’t 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’ve become yes the Ambassador and paid representative for this I love this program it’s going away soon you got to discover all about it let’s talk worker retention credit Josh Fox what is an ERC let’s simply start there so during the Trump Administration when President Trump was enacted they came up with the cares Act and the cares act offered services three chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically everybody it makes a huge distinction right there two of them are loans and one’s a refund exactly so the ERC is a refund that’s.
fix the cash cash payroll tax refund alright go on sorry I simply have to ensure we got that point I imply that’s a huge difference a loan versus cash money I like cash cash 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 stunning hard check in the mail where you get real cash from the IRS all right so let’s talk about how it works because it seems like to me if it’s a if it’s worker retention credit that individual needed to be an employee 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 workers right you had to have owned a company but it’s based on you having W-2 staff members 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 qualified so you need 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 six quarters the program was open well walk us through the 6 quarters so you had quarters 2 three and four of 2020 and you had quarters one two and three of 2021. okay so that’s how it’s determined you have to be on the W-2 during that period now let’s talk my preferred part money just how much can you return 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 employee’s salary to a maximum of five thousand dollars per worker for the year of 2020 and in 2021 the numbers escalated to 70 of the worker’s salary to a maximum of 7 thousand per quarter how did that happen um they just changed the rules in.
2021 versus due to the fact that 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 as much as five thousand Max and after that what takes place 21 000 Max in 2021 oh that’s how you come up with twenty 6 thousand twenty one thousand to twenty twenty one plus five thousand in twenty twenty that’s twenty six thousand dollars per worker that is since that’s a great deal of money it is now there’s a caution here the PPP money would need to be minimized from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan 2 you would minimize the 26 000 so what we’re seeing typically Kevin is if you took PPP cash somewhere 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 workers and you took PPP cash you would still get a million dollar in the mail from the internal revenue service so it’s substantial clearly now the big question is why does no one learn about this because appearance when I initially found out about this when I first fulfilled Josh you know I’ve got lots of financial investments in lots of business I’m a significant supporter for entrepreneurship in America and make many many investments in business owners of which many suffered through the pandemic when I initially heard about this I called BS I don’t believe it since 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 deserved and we used them sensibly to stay alive throughout the pandemic so when I heard about this I stated nah it can’t hold true but when I dug around I even contacted us to my politician pals Governor Senators they didn’t learn about it I indicate that’s how you understand that’s how misinformation is that there’s no information out there then a bunch of people informed me well you can’t get it because you took the PPP also not true so let’s ask Josh why does nobody learn about the worker retention credit you know what’s intriguing you’re discussing the banks Kevin because in the PPP loan procedure 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 nation and they would process process in Canada a pre-pp loan there’s no loans in Canada by the way it’s simply procedure procedure that’s all um and here there was mayhem because remember in the original cares act you might refrain from doing both programs so if you had actually done PPP you could not do ERC in the original program and when they altered the law in 2021 the banks were not doing ERC since it’s not alone so you’re getting a tax refund so the government never made it clear to anyone about how to.
do this does your CFO understand 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 some of them are doing it as a payroll business your accountant no your accountant’s never ever done this before unless you have an account that entered into this service and bottom line my company Kevin has stayed in business because 2009 and we have actually 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 huge big business customers have actually worked with bottom line to recover other government programs we have actually 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 developed to encourage.
companies to keep workers on their payroll. The credit is 50% of approximately $10,000 in wages paid by an.
Since of COVID-19 or whose gross receipts, employer whose company is totally or partly suspended.
decline by more than 50%.
Schedule.
1. The credit is readily available 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.
businesses who take Small Business Loans.
2. To certify, the employer needs to satisfy one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the company’s business is fully or partly 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. As soon as the.
employer’s gross invoices go above 80% of an equivalent quarter in 2019 they no longer qualify.
after the end of that quarter.
Estimation of the Credit.
The amount of the credit is 50% of the qualifying earnings paid up to $10,000 in overall.
It works for incomes paid after March 13th and before December 31, 2020.
The definition of qualifying wages varies by whether an employer had, usually, basically than.
100 workers in 2019.
Companies that specialize in ERC filing support typically offer know-how and assistance to assist businesses browse the complex procedure of declaring the credit. They can provide various services, including:.
How is the employee retention credit calculated? Employee Retention Credit 2021 And Ppp Loan
Eligibility Assessment: These companies will evaluate your business’s eligibility for the ERC based on factors such as your market, income, and operations. If you satisfy the requirements for the credit and determine the optimum credit quantity you can declare, they can assist identify.
Documents and Estimation: ERC filing services will assist in collecting the necessary documents, such as payroll records and monetary statements, to support your claim. They will likewise help compute the credit quantity based on eligible salaries and other certifying costs.
Retroactive Claim Review: If you are eligible to declare the ERC for prior quarters, these business can review your previous payroll records and financials to recognize potential chances for retroactive credits. They can assist you amend prior income tax return to claim these refunds.
Filing Support: Business focusing on ERC filings will prepare and send the essential types and paperwork on your behalf. This consists of completing Type 941 or any other necessary tax forms.
Compliance and Updates: ERC policies and assistance have actually evolved gradually. These business remain upgraded with the current changes and ensure that your filings abide by the most current standards. They can likewise provide continuous assistance if the IRS requests additional details or performs an audit related to your ERC claim.
It is essential to research and veterinarian any business offering ERC filing help to ensure their credibility and knowledge. Search for recognized firms with experience in tax and payroll services, or think about connecting to trusted accounting firms or tax professionals who provide ERC submitting assistance.
Bear in mind that while these companies can offer valuable assistance, it’s constantly a great idea to have a fundamental understanding of the ERC requirements and process yourself. This will assist you make notified choices and guarantee accurate filings.
The Worker Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief measures. The goal 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 qualified companies, consisting of for-profit organizations, tax-exempt organizations, and specific governmental entities. To qualify, companies need to fulfill one of two requirements:.
Business operations were fully or partially suspended due to a government order related to COVID-19.
The business experienced a significant decline in gross receipts. As discussed earlier, for 2021, a significant decline is defined as a 20% decrease in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a substantial decrease is defined as a 20% decrease in gross invoices compared to the very same quarter in 2019, or a 20% decline in gross receipts compared to the instantly preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit quantity is equal to a percentage (as much as 70%) of qualified earnings paid to employees, consisting of certain health insurance expenditures. 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, organizations that got a Paycheck Defense Program (PPP) loan were not qualified for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 allows services to claim the ERC even if they got a PPP loan. The exact same earnings can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has actually been retroactively broadened and improved, allowing eligible companies to declare the credit for qualified earnings paid as far back as March 13, 2020. This retroactive arrangement supplies an opportunity for services to change prior-year tax returns and get refunds.
Claiming the Credit: Employers can declare the ERC by reporting it on their employment income tax return, typically Kind 941. The excess can be refunded to the employer if the credit goes beyond the amount of employment taxes owed.
It is essential to keep in mind that the ERC provisions and eligibility criteria have actually progressed with time. The best strategy is to talk to a tax expert or check out the official internal revenue service site for the most updated and in-depth details regarding the ERC, including any current legal changes or updates.
To get approved for the ERC, an organization needs to satisfy one of the following criteria:.
The business operations were totally 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 defined as a 20% decrease in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a considerable decline is specified as a 20% decrease in gross receipts compared to the same quarter in 2019, or a 20% decline in gross receipts compared to the right away preceding quarter.
The ERC is offered to services of all sizes, consisting of tax-exempt companies, however there are some exceptions. For example, government entities and companies that received a PPP loan may have constraints on claiming the credit.
The procedure for declaring the ERC involves finishing the needed kinds and including the credit on your employment income tax return (usually 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 organization and the work of the IRS. It’s suggested to talk to a tax expert for guidance particular to your situation.
There are numerous business that can aid with the process of claiming the ERC. These include accounting firms, tax advisory services, and payroll company. Some widely known business that offer help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s a good idea to research study and contact these business directly to inquire about their costs and services.
Please keep in mind that the details supplied here is based on general understanding and might not show the most recent updates or modifications to the ERC. It’s important to consult with a tax professional or check out the main IRS website for the most updated and accurate information regarding eligibility, declaring procedures, and available help.
Less than 100. The credit is based if the company had 100 or less employees on average in 2019.
on wages paid to all employees whether they really worked or not. Simply put, even if the.
staff members 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 staff members on average in 2019.
enabled only for incomes paid to employees who did not work during the calendar quarter.
In both cases, “wages” includes not simply money payments but likewise a portion of the expense of company.
provided health care. Employee Retention Credit 2021 And Ppp Loan
Payment.
Companies can be right away compensated for the credit by reducing the quantity of payroll taxes they.