Lets talk first about Employee Retention Credit 2021 Q4 :
Our team here what do these people doing everybody in this space is helping teach individuals about ERC and uh always supply a gorgeous breakfast and have people really learn about the program we should head to the space where we have the ability to display a few of the checks that we are getting for companies and I want to see that what is this this is uh numerous millions of dollars literally Kevin hundreds of millions of dollars so these are replicate copies of the letters that go to clients verifying that the check is on the way I suggest you know if you just begin 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 indicate it’s just I imply consider the number of real clients 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 IRS heading to the client so that’s how you’re able to track it you understand when you
get this you understand the check is chosen sure and that’s when they pay so they do not pay anything until they really 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 savings account and they can truly trust Wonder trust that the procedure has been ended up and how many you believe you have actually processed given that you started this we have to do with 35 000 of these for
about six billion dollars wow so clearly they know what they’re doing which’s what you require you need experts 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 Wonderful here you’re at my YouTube channel we’re speaking about something truly important today the worker retention credit which the majority of you have never heard of I definitely had not heard of it up until very just recently and learned a lot about it due to the fact that this is most likely the most affordable cost of capital for any small company anywhere
anytime if you have workers in between 5 and five hundred so I’ve got the expert 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 hard this isn’t like PPP we just contact your bank supervisor and say 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 have actually become yes the Ambassador and paid spokesperson for this I enjoy this program it’s going away soon you got to learn all about it let’s talk employee retention credit Josh Fox what is an ERC let’s simply begin there so throughout the Trump Administration when President Trump was enacted they came up with the cares Act and the cares act offered businesses 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 distinction right there two of them are loans and one’s a refund exactly so the ERC is a refund that’s.
remedy the money cash payroll tax refund fine go on sorry I just have to make sure we got that point I suggest that’s a huge distinction a loan versus money money I like money money that’s what we’re speaking 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 stunning tough check in the mail where you get actual cash from the internal revenue service all right so let’s discuss how it works due to the fact that it seems like to me if it’s a if it’s worker retention credit that person had to be a staff member 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 employees right you had to have owned an organization but it’s based on you having W-2 workers 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 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 three and four of 2020 and you had quarters one two and 3 of 2021. alright so that’s how it’s measured you need to be on the W-2 during that period now let’s talk my favorite part cash just how much can you return per employee that was on a W-2 in those 6 quarters so the calculation in 2020 to be specific Kevin is 50 of the worker’s income to a maximum of 5 thousand dollars per staff member for the year of 2020 and in 2021 the numbers increased to 70 of the worker’s salary to an optimum of seven thousand per quarter how did that take place um they just changed the rules in.
2021 versus because the mayhem 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 approximately five thousand Max and then what happens 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 lot of cash it is now there’s a caveat here the PPP cash 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 money somewhere around ten thousand dollars an individual 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 internal revenue service so it’s big undoubtedly now the big question is why does no one know about this since appearance when I initially found out about this when I first satisfied Josh you know I have actually got lots of financial investments in lots of business I’m a significant advocate for entrepreneurship in America and make lots of many financial investments in entrepreneurs of which lots of suffered through the pandemic when I first heard about this I called BS I do not believe it since I utilize the PPP we went through the cash center Banks to get it it was really easy to do we had our CEOs call the banks they got their loans and that were well deserved and we used them wisely to survive 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 Governor Senators they didn’t learn about it I indicate that’s how you understand that’s how false information is that there’s no info out there then a lot of people told me well you can’t get it because you took the PPP likewise not true so let’s ask Josh why does nobody know about the worker retention credit you know what’s intriguing you’re discussing the banks Kevin due to the fact that in the PPP loan procedure 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 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 just process procedure that’s all um and here there was chaos since remember in the original cares act you could refrain from doing both programs so if you had actually done PPP you might refrain from doing ERC in the original program and when they altered the law in 2021 the banks were refraining from doing ERC since it’s not alone so you’re getting a tax refund so the government never ever made it clear to any person about how to.
do this does your CFO understand how to do this not actually she or he’s never ever done it before 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 accounting professional no your accounting professional’s never ever done this before unless you have an account that entered into this company 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 federal government to recover cash for Fortune 500 Fortune 1000 companies so a great deal of our huge huge corporate customers have worked with bottom line to recover other government programs we’ve done sales tax and utilize tax joblessness tax work opportunity tax credits research and development tax credits unclaimed property property tax all of these other government programs.
The worker retention tax credit is a broad based refundable tax credit developed to encourage.
employers to keep employees on their payroll. The credit is 50% of approximately $10,000 in wages paid by an.
company whose service is fully or partially suspended because of COVID-19 or whose gross invoices.
decrease by more than 50%.
1. The credit is available to all employers regardless of size consisting of tax exempt organizations. There are.
only two exceptions: (1) state and local governments and their instrumentalities and (2) little.
services 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 employer’s company is totally or partially suspended by government order due to COVID-19.
during the calendar quarter or.
o the company’s gross invoices are below 50% of the similar quarter in 2019. As soon as the.
company’s gross receipts exceed 80% of a comparable quarter in 2019 they no longer certify.
after the end of that quarter.
Estimation of the Credit.
The amount of the credit is 50% of the qualifying salaries paid up to $10,000 in total.
It works for salaries paid after March 13th and prior to December 31, 2020.
The definition of qualifying earnings varies by whether a company had, typically, basically than.
100 staff members in 2019.
Companies that concentrate on ERC filing assistance normally supply proficiency and support to help businesses browse the complex procedure of claiming the credit. They can offer various services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit 2021 Q4
Eligibility Evaluation: These companies will examine your organization’s eligibility for the ERC based on aspects such as your market, revenue, and operations. If you fulfill the requirements for the credit and recognize the maximum credit quantity you can declare, they can help identify.
Documentation and Computation: ERC filing services will help in collecting the required paperwork, such as payroll records and monetary declarations, to support your claim. They will likewise help compute the credit quantity based on eligible incomes and other certifying costs.
Retroactive Claim Review: If you are qualified to declare the ERC for prior quarters, these companies can evaluate your previous payroll records and financials to recognize possible chances for retroactive credits. They can help you modify prior income tax return to claim these refunds.
Filing Help: Business concentrating on ERC filings will prepare and submit the required types and paperwork on your behalf. This consists of completing Type 941 or any other required tax return.
Compliance and Updates: ERC policies and assistance have progressed in time. These companies stay updated with the latest modifications and ensure that your filings comply with the most current guidelines. If the Internal revenue service requests additional information or performs an audit related to your ERC claim, they can also offer continuous assistance.
It’s important to research study and veterinarian any business using ERC filing support to guarantee their reliability and proficiency. Look for established firms with experience in tax and payroll services, or consider reaching out to relied on accounting firms or tax experts who provide ERC submitting support.
Bear in mind that while these business can offer important support, it’s always a great idea to have a basic understanding of the ERC requirements and process yourself. This will assist you make informed decisions and guarantee accurate filings.
The Worker Retention Credit (ERC) is a refundable tax credit presented by the U.S. federal government as part of COVID-19 relief steps. The objective of the ERC is to encourage services to maintain 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 employers, consisting of for-profit companies, tax-exempt companies, and particular governmental entities. To certify, companies need to satisfy one of two requirements:.
The business operations were fully or partially suspended due to a federal government order related to COVID-19.
Business experienced a considerable decline in gross invoices. As mentioned previously, for 2021, a substantial decline is specified as a 20% decrease in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a considerable decrease is specified as a 20% decline in gross receipts compared to the exact same quarter in 2019, or a 20% decline 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 amounts to a portion (up to 70%) of certified wages paid to staff members, including certain health plan 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, services that got a Paycheck Defense Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 enables organizations to claim the ERC even if they received a PPP loan. The same wages can not be utilized to claim both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively expanded and boosted, allowing eligible employers to declare the credit for certified earnings paid as far back as March 13, 2020. This retroactive arrangement offers an opportunity for services to modify prior-year tax returns and get refunds.
Declaring the Credit: Companies can claim the ERC by reporting it on their work income tax return, normally Form 941. If the credit exceeds the amount of employment taxes owed, the excess can be reimbursed to the company.
It is very important to keep in mind that the ERC arrangements and eligibility requirements have developed with time. The very best course of action is to consult with a tax professional or check out the main IRS site for the most up-to-date and in-depth information regarding the ERC, consisting of any current legal changes or updates.
To qualify for the ERC, an organization should satisfy one of the following requirements:.
The business operations were totally or partially suspended due to a federal government order related to COVID-19.
Business experienced a substantial decline in gross receipts. For 2021, a significant decline is defined as a 20% decline in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a considerable decline is specified as a 20% decline in gross invoices compared to the same quarter in 2019, or a 20% decrease in gross invoices compared to the instantly preceding quarter.
The ERC is readily available to businesses of all sizes, consisting of tax-exempt organizations, but there are some exceptions. Federal government entities and businesses that got a PPP loan might have constraints on claiming the credit.
The process for declaring the ERC involves completing the essential types and consisting of the credit on your work tax return (generally Form 941). The exact time it takes to process the credit can differ based on numerous factors, consisting of the intricacy of your company and the workload of the IRS. It’s recommended to consult with a tax expert for guidance particular to your circumstance.
There are a number of companies that can assist with the process of declaring the ERC. These include accounting companies, tax advisory services, and payroll provider. Some well-known business that offer help with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s advisable to research and contact these companies straight to ask about their services and charges.
Please keep in mind that the information supplied here is based on general understanding and may not reflect the most current updates or modifications to the ERC. It is essential to speak with a tax professional or check out the official internal revenue service site for the most current and accurate information relating to eligibility, declaring procedures, and readily available support.
Less than 100. The credit is based if the employer had 100 or less workers on average in 2019.
on wages paid to all workers whether they really worked or not. In other words, even if the.
staff members worked full time and got paid for full-time work, the company still gets the credit.
Greater than 100. The credit is if the company had more than 100 staff members on average in 2019.
allowed just for earnings paid to workers who did not work throughout the calendar quarter.
In both cases, “earnings” includes not just money payments but also a portion of the cost of employer.
offered healthcare. Employee Retention Credit 2021 Q4
Employers can be immediately compensated for the credit by lowering the quantity of payroll taxes they.