Lets talk first about Employee Retention Credit 2021 Deadline To File :
Our group here what do these guys doing everybody in this space is assisting teach individuals about ERC and uh constantly supply a stunning breakfast and have people actually learn more about the program we should head to the space where we are able to show some of the checks that we are getting for business and I ‘d like to see that what is this this is uh numerous countless dollars literally Kevin hundreds of countless dollars so these are replicate copies of the letters that go to clients validating that the check is on the way I suggest you know if you just start to take a look at a few of these here I mean 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 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 verified 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 understand when you
get this you understand the check is opted for sure which’s when they pay so they do not pay anything until they in fact receive the money they do not pay bottom line Wonder trust anything until this letter is confirmed the check is on the way they deposit it into their checking account and they can really trust Wonder trust that the procedure has been ended up and the number of you think you’ve processed because you began 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 require you require specialists 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 speaking about something really crucial today the worker retention credit which the majority of you have actually never become aware of I certainly hadn’t heard of it up until really just recently and learned a lot about it since this is most likely the most affordable cost of capital for any small company anywhere
anytime if you have staff members in between five and five hundred so I have actually got the specialist with me this is Josh Fox he’s the creator and CEO of bottom line Concepts 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’ve ended up being yes the Ambassador and paid representative for this I like this program it’s going away very soon you got to find out everything 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 developed the cares Act and the cares act offered services 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 two of them are loans and one’s a refund exactly so the ERC is a refund that’s.
fix the money cash payroll tax refund alright go on sorry I just need to ensure we got that point I suggest that’s a huge distinction a loan versus cash money I like money 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 beautiful hard check in the mail where you get actual cash from the IRS all right so let’s discuss 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 staff member so I’m going to make the Presumption this money 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 a service but it’s based upon you having W-2 staff members in America not 10.99. so as long as you had W-2 staff members 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 need to be on payroll for the first 6 months of 2021 on the W-2 proper so there were 6 quarters the program was open well stroll us through the six quarters so you had quarters 2 3 and four of 2020 and you had quarters one two and 3 of 2021. fine so that’s how it’s measured you have to be on the W-2 throughout that duration now let’s talk my favorite part money how much can you return per staff member that was on a W-2 in those 6 quarters so the estimation in 2020 to be specific Kevin is 50 of the employee’s wage to a maximum of five thousand dollars per employee for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the worker’s income to a maximum of 7 thousand per quarter how did that happen um they simply altered the rules in.
2021 versus because the turmoil of the pandemic so they wanted 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 approximately five thousand Max and then what happens 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 six thousand dollars per employee that is since that’s a lot of money it is now there’s a caution here the PPP cash would need to be lowered from the twenty six thousand dollars so if you took PPP loan one and PPP loan two you would minimize the 26 000 so what we’re seeing on average Kevin is if you took PPP cash someplace around ten thousand dollars an individual 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 cash you would still get a million dollar in the mail from the internal revenue service so it’s huge clearly now the huge question is why does nobody know about this because look when I initially found out about this when I initially satisfied Josh you understand I have actually got great deals of financial investments in lots of companies I’m a significant supporter for entrepreneurship in America and make many lots of financial investments in entrepreneurs of which lots of suffered through the pandemic when I first became aware of this I called BS I do not believe it due to the fact that I utilize 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 deserved and we utilized them sensibly to stay alive during the pandemic so when I found out about this I stated nah it can’t be true but when I dug around I even contacted us to my politician good friends Governor Senators they didn’t learn about it I indicate that’s how you know that’s how misinformation is that there’s no information out there then a bunch of individuals told me well you can’t get it since you took the PPP also not real so let’s ask Josh why does nobody learn about the worker retention credit you understand what’s interesting you’re speaking about the banks Kevin due to the fact that in the PPP loan process the federal government made it really clear that if you wanted a PPP loan you would call Wells Fargo Citibank Bank of America any of the huge 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 just procedure process 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 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 because 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 he or she’s never done it before do the banks do it nope the banks do not do it the payroll companies yeah some of them are doing it as a payroll company your accounting professional no your accounting professional’s never done this prior to unless you have an account that entered into this organization and bottom line my firm Kevin has been in business given that 2009 and we have actually been dealing with the federal government and the state federal government to recover money for Fortune 500 Fortune 1000 companies so a lot of our big huge business customers have worked with bottom line to recover other federal government programs we have actually done sales tax and use tax unemployment tax work chance tax credits research and development tax credits unclaimed property property tax all of these other government programs.
The employee retention tax credit is a broad based refundable tax credit created to encourage.
employers to keep workers on their payroll. The credit is 50% of up to $10,000 in wages paid by an.
employer whose service is completely or partially suspended because of COVID-19 or whose gross invoices.
decrease by more than 50%.
1. The credit is available to all employers no matter size consisting of tax exempt companies. There are.
just two exceptions: (1) state and local governments and their instrumentalities and (2) little.
services who take Small Business Loans.
2. To certify, the company has to satisfy one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the employer’s company is fully or partially suspended by federal government order due to COVID-19.
throughout the calendar quarter or.
o the employer’s gross receipts are below 50% of the similar quarter in 2019. Once the.
employer’s gross invoices go above 80% of a comparable quarter in 2019 they no longer qualify.
after completion of that quarter.
Calculation of the Credit.
The quantity of the credit is 50% of the qualifying salaries paid up to $10,000 in total.
It is effective for earnings paid after March 13th and prior to December 31, 2020.
The meaning of certifying incomes differs by whether a company had, typically, more or less than.
100 employees in 2019.
Business that concentrate on ERC filing assistance generally provide competence and assistance to help services browse the complex process of declaring the credit. They can offer different services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit 2021 Deadline To File
Eligibility Evaluation: These companies will evaluate your service’s eligibility for the ERC based on aspects such as your industry, profits, and operations. If you meet the requirements for the credit and recognize the maximum credit quantity you can claim, they can assist figure out.
Documents and Calculation: ERC filing services will assist in gathering the needed paperwork, such as payroll records and monetary declarations, to support your claim. They will likewise help determine the credit amount based upon eligible incomes and other certifying costs.
Retroactive Claim Review: If you are qualified to claim the ERC for prior quarters, these companies can review your past payroll records and financials to determine potential opportunities for retroactive credits. They can assist you amend prior tax returns to claim these refunds.
Filing Support: Business focusing on ERC filings will prepare and submit the required forms and documents on your behalf. This includes finishing Type 941 or any other necessary tax forms.
Compliance and Updates: ERC policies and assistance have evolved over time. These business remain updated with the latest modifications and guarantee that your filings adhere to the most existing guidelines. They can likewise offer ongoing assistance if the IRS demands additional info or conducts an audit related to your ERC claim.
It is necessary to research study and veterinarian any company offering ERC filing assistance to ensure their credibility and know-how. Search for recognized firms with experience in tax and payroll services, or consider reaching out to trusted accounting firms or tax professionals who offer ERC submitting support.
Bear in mind that while these business can offer important help, it’s constantly a good idea to have a fundamental understanding of the ERC requirements and procedure yourself. This will assist you make notified decisions and ensure 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 procedures. The goal of the ERC is to encourage services to maintain and pay their workers during the pandemic, even if their operations have been affected.
Here are some bottom lines 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, employers need to satisfy one of two criteria:.
The business operations were totally or partially suspended due to a government order related to COVID-19.
Business experienced a considerable decrease in gross invoices. As pointed out previously, for 2021, a significant decline is defined as a 20% decrease in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a significant decrease is defined as a 20% decline in gross receipts compared to the 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 amount is equal to a portion (approximately 70%) of qualified wages paid to staff members, consisting of certain health insurance expenses. 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, companies that received an Income Security Program (PPP) loan were not eligible for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 enables companies to declare the ERC even if they got a PPP loan. The exact same wages can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively expanded and improved, allowing qualified employers to declare the credit for qualified salaries paid as far back as March 13, 2020. This retroactive provision offers a chance for businesses to change prior-year tax returns and get refunds.
Declaring the Credit: Companies can declare the ERC by reporting it on their employment income tax return, generally Form 941. The excess can be reimbursed to the company if the credit surpasses the quantity of work taxes owed.
It is very important to note that the ERC arrangements and eligibility criteria have actually evolved gradually. The very best strategy is to speak with a tax professional or visit the official IRS site for the most comprehensive and updated details concerning the ERC, including any current legal changes or updates.
To receive the ERC, a company must fulfill one of the following criteria:.
Business operations were completely or partly suspended due to a government order related to COVID-19.
The business experienced a considerable decrease in gross invoices. For 2021, a considerable decrease is defined as a 20% decrease in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a substantial decline is defined as a 20% decline in gross receipts compared to the same quarter in 2019, or a 20% decline in gross invoices compared to the right away preceding quarter.
The ERC is readily available to businesses of all sizes, consisting of tax-exempt companies, however there are some exceptions. Federal government entities and businesses that received a PPP loan may have restrictions on declaring the credit.
The procedure for declaring the ERC includes finishing the required kinds and including the credit on your work income tax return (usually Type 941). The exact time it takes to process the credit can differ based upon numerous factors, consisting of the intricacy of your business and the workload of the IRS. It’s suggested to consult with a tax professional for guidance particular to your circumstance.
There are several companies that can help with the process of declaring the ERC. Some widely known companies that provide support with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the information supplied here is based on general knowledge and may not reflect the most current updates or modifications to the ERC. It is necessary to talk to a tax expert or go to the main IRS website for the most updated and precise info regarding eligibility, declaring procedures, and available assistance.
Less than 100. If the employer had 100 or fewer workers typically in 2019, then the credit is based.
on incomes paid to all staff members whether they in fact worked or not. To put it simply, even if the.
staff members worked full time and got paid for full time work, the employer still gets the credit.
Greater than 100. The credit is if the employer had more than 100 workers on average in 2019.
permitted just for wages paid to employees who did not work throughout the calendar quarter.
In both cases, “earnings” consists of not simply money payments however also a part of the cost of employer.
provided health care. Employee Retention Credit 2021 Deadline To File
Employers can be instantly reimbursed for the credit by lowering the quantity of payroll taxes they.