Lets talk first about Employee Retention Credit 2021 Extended :
Our team here what do these men doing everybody in this space is assisting teach people about ERC and uh constantly provide a stunning breakfast and have individuals truly learn about the program we must head to the space where we are able to show a few 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 countless dollars so these are duplicate copies of the letters that go to customers verifying that the check is on the way I suggest you know if you simply begin to look at some of these here I mean this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I indicate it’s just I imply think of how many real 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 customer 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 do not pay anything until they really receive the money they don’t pay bottom line Wonder trust anything until this letter is validated the check is on the way they deposit it into their bank account and they can really rely on Wonder trust that the procedure has been finished and how many you think you have actually processed since you started this we’re about 35 000 of these for
about 6 billion dollars wow so clearly 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 Terrific here you’re at my YouTube channel we’re discussing something truly essential today the employee retention credit which the majority of you have actually never ever become aware of I definitely had not heard of it till really just recently and discovered a lot about it since this is probably the most affordable expense of capital for any small business anywhere
anytime if you have staff members between 5 and five hundred so I’ve got the expert with me this is Josh Fox he’s the creator 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 call your bank supervisor and say offer 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 have actually ended up being yes the Ambassador and paid representative for this I enjoy this program it’s disappearing very soon you got to find out everything about it let’s talk staff member retention credit Josh Fox what is an ERC let’s just begin there so throughout the Trump Administration when President Trump was enacted they developed the cares Act and the cares act provided businesses 3 opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly everybody it makes a big distinction right there 2 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 fine go on sorry I simply need to make certain we got that point I imply that’s a huge distinction a loan versus money money I like cash money 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 original cares Act is the ERC and yes Kevin it is a stunning tough check in the mail where you get real cash from the internal revenue service all right so let’s speak about how it works because it seems like to me if it’s a if it’s worker retention credit that person had to be an employee so I’m going to make the Assumption this cash is not for the owner not for people on the cap table not for investors it’s for employees right you needed to have owned an organization however it’s based upon you having W-2 workers 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 qualified so you have to be on payroll in 2020 on the W-2 and you have to be on payroll for the first 6 months of 2021 on the W-2 appropriate so there were six quarters the program was open well walk us through the six quarters so you had quarters two three and four of 2020 and you had quarters one 2 and three of 2021. all right so that’s how it’s measured you have to be on the W-2 during that duration 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 6 quarters so the estimation in 2020 to be specific Kevin is 50 of the worker’s wage to an optimum of 5 thousand dollars per worker for the year of 2020 and in 2021 the numbers increased to 70 of the employee’s wage to an optimum of seven thousand per quarter how did that happen um they simply changed the rules in.
2021 versus because 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 up to 5 thousand Max and then what takes place 21 000 Max in 2021 oh that’s how you create twenty six thousand twenty one thousand to twenty twenty one plus five thousand in twenty twenty that’s twenty 6 thousand dollars per employee that is since that’s a great deal 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 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 say hypothetically you owned a restaurant in New York City where I’m from and you had a hundred staff members and you took PPP cash you would still get a million dollar in the mail from the IRS so it’s big obviously now the big concern is why does no one learn about this because appearance when I initially became aware of this when I initially fulfilled Josh you know I have actually got great deals of investments in great deals of companies I’m a significant advocate for entrepreneurship in America and make many numerous financial investments in entrepreneurs of which numerous suffered through the pandemic when I initially became aware of this I called BS I do not believe it because I use 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 and that were well should have and we utilized them carefully to stay alive during the pandemic so when I heard about this I stated nah it can’t hold true but when I dug around I even called to my politician buddies Governor Senators they didn’t understand about it I imply that’s how you understand that’s how false information is that there’s no information out there then a lot of people informed me well you can’t get it due to the fact that you took the PPP likewise not true so let’s ask Josh why does no one know about the employee retention credit you know what’s fascinating you’re discussing the banks Kevin due to the fact that in the PPP loan procedure the federal government made it extremely 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 procedure in Canada a pre-pp loan there’s no loans in Canada by the way it’s simply process procedure that’s all um and here there was mayhem because keep in mind in the initial cares act you could refrain from doing both programs so if you had actually done PPP you could not do ERC in the initial 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 federal government never made it clear to anybody about how to.
do this does your CFO know how to do this not truly she or he’s never ever done it in the past 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 accountant no your accountant’s never ever done this before unless you have an account that entered into this company and bottom line my firm Kevin has actually stayed in business because 2009 and we’ve been working with the federal government and the state federal government to recover cash for Fortune 500 Fortune 1000 companies so a great deal of our big huge corporate customers have actually worked with bottom line to recover other federal government programs we have actually done sales tax and use tax unemployment tax work opportunity tax credits research and development tax credits unclaimed home property tax all of these other federal government programs.
The worker retention tax credit is a broad based refundable tax credit created to motivate.
employers to keep workers on their payroll. The credit is 50% of up to $10,000 in earnings paid by an.
Because of COVID-19 or whose gross receipts, company whose company is completely or partially suspended.
decrease by more than 50%.
Accessibility.
1. The credit is offered to all companies regardless of size consisting of tax exempt companies. There are.
only two exceptions: (1) state and city governments and their instrumentalities and (2) small.
organizations who take Small company Loans.
2. To qualify, the company has to meet one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the employer’s business is fully or partly suspended by government order due to COVID-19.
throughout the calendar quarter or.
o the employer’s gross receipts are listed below 50% of the equivalent quarter in 2019. As soon as the.
company’s gross invoices exceed 80% of an equivalent quarter in 2019 they no longer qualify.
after the end of that quarter.
Calculation of the Credit.
The amount of the credit is 50% of the certifying salaries paid up to $10,000 in total.
It works for wages paid after March 13th and prior to December 31, 2020.
The definition of qualifying earnings varies by whether a company had, on average, basically than.
100 staff members in 2019.
Companies that focus on ERC filing help normally offer know-how and assistance to help organizations navigate the intricate procedure of declaring the credit. They can provide various services, including:.
How is the employee retention credit calculated? Employee Retention Credit 2021 Extended
Eligibility Evaluation: These companies will evaluate your company’s eligibility for the ERC based on factors such as your market, earnings, and operations. If you satisfy the requirements for the credit and recognize the optimum credit quantity you can declare, they can help determine.
Documents and Calculation: ERC filing services will assist in collecting the needed documents, such as payroll records and monetary declarations, to support your claim. They will also assist compute the credit amount based upon qualified earnings and other qualifying expenses.
Retroactive Claim Evaluation: If you are qualified to claim the ERC for prior quarters, these companies can review your past payroll records and financials to determine potential chances for retroactive credits. They can help you change prior tax returns to declare these refunds.
Filing Assistance: Business specializing in ERC filings will prepare and submit the required types and paperwork on your behalf. This includes completing Type 941 or any other required tax return.
Compliance and Updates: ERC policies and guidance have actually evolved gradually. These companies stay updated with the most recent changes and guarantee that your filings abide by the most existing standards. If the IRS demands extra information or carries out an audit associated to your ERC claim, they can likewise offer continuous support.
It’s important to research and vet any company providing ERC filing support to guarantee their reliability and knowledge. Search for established firms with experience in tax and payroll services, or consider connecting to trusted accounting companies or tax experts who use ERC filing support.
Bear in mind that while these companies can supply valuable help, it’s always a great idea to have a standard understanding of the ERC requirements and procedure yourself. This will help you make notified decisions and ensure precise 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 businesses to maintain and pay their staff members throughout the pandemic, even if their operations have been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is readily available to qualified employers, consisting of for-profit services, tax-exempt companies, and particular governmental entities. To certify, companies need to fulfill one of two criteria:.
Business operations were totally or partly suspended due to a government order related to COVID-19.
The business experienced a significant decrease in gross receipts. As mentioned earlier, for 2021, a significant decrease is defined as a 20% decline in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a substantial decrease is specified as a 20% decrease in gross receipts compared to the same quarter in 2019, or a 20% decrease in gross receipts compared to the immediately preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit quantity amounts to a percentage (approximately 70%) of certified salaries paid to employees, consisting of particular health insurance expenses. The maximum 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 received an Income Protection Program (PPP) loan were not qualified for the ERC. However, legislation passed in late 2020 and extended in 2021 permits organizations to claim the ERC even if they received a PPP loan. Nevertheless, the exact 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 boosted, enabling eligible employers to claim the credit for qualified earnings paid as far back as March 13, 2020. This retroactive provision supplies a chance for services to modify prior-year income tax return and get refunds.
Claiming the Credit: Companies can declare the ERC by reporting it on their employment tax returns, normally Kind 941. The excess can be reimbursed to the employer if the credit surpasses the amount of work taxes owed.
It is very important to keep in mind that the ERC provisions and eligibility requirements have actually developed with time. The very best strategy is to seek advice from a tax expert or visit the official IRS site for the most in-depth and updated information relating to the ERC, consisting of any current legal modifications or updates.
To qualify for the ERC, an organization must satisfy one of the following criteria:.
Business operations were fully or partially suspended due to a federal government order related to COVID-19.
Business experienced a substantial decrease in gross invoices. For 2021, a significant decrease is defined as a 20% decrease in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a substantial decline is specified as a 20% decrease in gross invoices 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 organizations, however there are some exceptions. For instance, federal government entities and businesses that got a PPP loan might have restrictions on declaring the credit.
The procedure for declaring the ERC involves completing the necessary types and including the credit on your employment income tax return (usually Form 941). The exact time it takes to process the credit can differ based on numerous elements, including the complexity of your company and the workload of the internal revenue service. It’s recommended to seek advice from a tax professional for guidance specific to your circumstance.
There are a number of business that can assist with the process of claiming the ERC. These consist of accounting companies, tax advisory services, and payroll service providers. Some widely known companies that use help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s recommended to research and call these business straight to ask about their charges and services.
Please keep in mind that the details offered here is based upon general knowledge and might not show the most current updates or changes to the ERC. It is necessary to speak with a tax expert or visit the official internal revenue service website for the most current and accurate details relating to eligibility, declaring treatments, and available support.
Less than 100. If the employer had 100 or less workers usually in 2019, then the credit is based.
on incomes paid to all staff members whether they actually worked or not. In other words, even if the.
employees 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.
allowed just for earnings paid to staff members who did not work during the calendar quarter.
In both cases, “wages” consists of not just cash payments but likewise a portion of the cost of employer.
provided health care. Employee Retention Credit 2021 Extended
Payment.
Companies can be immediately reimbursed for the credit by reducing the quantity of payroll taxes they.