Lets talk first about Employee Retention Credit 2022 Self Employed :
Our team here what do these guys doing everyone in this room is helping teach individuals about ERC and uh always supply a gorgeous breakfast and have individuals really learn about the program we need to head to the space where we are able to show some of the checks that we are getting for business and I want to see that what is this this is uh numerous millions of dollars actually Kevin numerous millions of dollars so these are duplicate copies of the letters that go to clients verifying that the check is on the way I indicate you know if you just 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 mean it’s simply I indicate think of 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 verified the numbers are confirmed and the check is on the mail in the mail from the internal revenue service heading to the customer so that’s how you have the ability to track it you understand when you
receive this you know the check is opted for sure which’s when they pay so they do not pay anything until they actually get the money they don’t pay bottom line Wonder trust anything up until this letter is confirmed the check is on the way they deposit it into their bank account and they can really trust Wonder trust that the process has been finished and how many you think you’ve processed since 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 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 Wonderful here you’re at my YouTube channel we’re speaking about something really essential today the staff member retention credit which the majority of you have actually never heard of I certainly hadn’t become aware of it up until extremely recently and discovered a lot about it because this is probably the most affordable cost of capital for any small business anywhere
anytime if you have workers 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 largest processor of these ERC credits this is a 170 page program so it’s difficult this isn’t like PPP we simply call up your bank supervisor and say give 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’ve become yes the Ambassador and paid representative for this I love this program it’s going away soon you got to find out everything about it let’s talk employee retention credit Josh Fox what is an ERC let’s just begin there so during the Trump Administration when President Trump was enacted they created the cares Act and the cares act used companies three opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly everybody it makes a huge difference right there two of them are loans and one’s a refund precisely so the ERC is a refund that’s.
remedy the cash money payroll tax refund all right go on sorry I just have to make certain we got that point I mean that’s a huge distinction a loan versus money money I like money money that’s what we’re discussing 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 gorgeous tough check in the mail where you get actual money from the IRS 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 had to be an employee 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 employees right you needed to have owned an organization however it’s based on you having W-2 employees 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 have to be on payroll in 2020 on the W-2 and you need to be on payroll for the first six months of 2021 on the W-2 correct 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. alright so that’s how it’s measured you have to be on the W-2 during that period now let’s talk my favorite part cash just how much can you return per worker that was on a W-2 in those 6 quarters so the calculation in 2020 to be exact Kevin is 50 of the staff member’s income 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 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 chaos 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 takes place 21 000 Max in 2021 oh that’s how you create twenty 6 thousand twenty one thousand to twenty twenty one plus 5 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 caveat here the PPP money would need to be lowered from the twenty six thousand dollars so if you took PPP loan one and PPP loan 2 you would decrease the 26 000 so what we’re seeing usually Kevin is if you took PPP money somewhere around ten thousand dollars a person so let’s say hypothetically you owned a dining establishment in New york city City where I’m from and you had a hundred staff members and you took PPP money you would still get a million dollar in the mail from the internal revenue service so it’s substantial certainly now the huge concern is why does nobody know about this due to the fact that look when I initially became aware of this when I initially met Josh you know I’ve got great deals of investments in great deals of business I’m a significant advocate for entrepreneurship in America and make lots of lots of financial investments in business owners of which many suffered through the pandemic when I initially heard about this I called BS I don’t think it because 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 which were well deserved and we used them wisely to survive during the pandemic so when I heard about this I stated nah it can’t hold true however when I dug around I even contacted us to my political leader buddies Guv Senators they didn’t learn about it I imply 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 since you took the PPP also not true so let’s ask Josh why does nobody know about the employee retention credit you know what’s interesting you’re talking about the banks Kevin since 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 huge banks in our country and they would process procedure in Canada a pre-pp loan there’s no loans in Canada by the way it’s simply procedure process that’s all um and here there was turmoil because remember in the original cares act you might refrain from doing both programs so if you had actually done PPP you might not do ERC in the initial program and when they altered 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 ever made it clear to anybody 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 accounting professional no your accounting professional’s never done this before unless you have an account that went into this service and bottom line my company Kevin has 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 dealt with bottom line to recover other government programs we have actually done sales tax and utilize tax unemployment tax work chance tax credits research and development tax credits unclaimed property real estate tax all of these other federal government programs.
The staff member retention tax credit is a broad based refundable tax credit developed to motivate.
employers to keep workers on their payroll. The credit is 50% of approximately $10,000 in earnings paid by an.
Due to the fact that of COVID-19 or whose gross invoices, company whose company is completely or partially suspended.
decrease by more than 50%.
1. The credit is offered to all employers no matter size including tax exempt companies. There are.
only two exceptions: (1) state and city governments and their instrumentalities and (2) little.
organizations who take Small Business Loans.
2. To certify, the employer needs to meet 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 employer’s gross receipts are listed below 50% of the comparable quarter in 2019. When the.
employer’s gross receipts exceed 80% of a similar quarter in 2019 they no longer qualify.
after the end of that quarter.
Computation of the Credit.
The quantity of the credit is 50% of the qualifying wages paid up to $10,000 in total.
It is effective for earnings paid after March 13th and before December 31, 2020.
The meaning of certifying earnings differs by whether an employer had, typically, more or less than.
100 employees in 2019.
Companies that focus on ERC filing help generally supply competence and assistance to help services navigate the complicated procedure of declaring the credit. They can provide various services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit 2022 Self Employed
Eligibility Assessment: These companies will assess your service’s eligibility for the ERC based on elements such as your market, income, and operations. They can assist figure out if you meet the requirements for the credit and recognize the optimum credit quantity you can declare.
Paperwork and Calculation: ERC filing services will assist in gathering the necessary documents, such as payroll records and monetary statements, to support your claim. They will likewise help compute the credit amount based on eligible incomes and other qualifying expenditures.
Retroactive Claim Evaluation: If you are eligible to declare the ERC for prior quarters, these companies can evaluate your previous payroll records and financials to recognize potential opportunities for retroactive credits. They can assist you modify prior income tax return to declare these refunds.
Filing Assistance: Business focusing on ERC filings will prepare and submit the essential types and paperwork in your place. This includes finishing Kind 941 or any other required tax return.
Compliance and Updates: ERC policies and assistance have actually developed over time. These companies remain upgraded with the current changes and ensure that your filings abide by the most existing standards. If the IRS requests extra info or performs an audit associated to your ERC claim, they can likewise offer ongoing support.
It is necessary to research and vet any company using ERC filing support to guarantee their reliability and expertise. Search for recognized firms with experience in tax and payroll services, or consider connecting to relied on accounting companies or tax specialists who offer ERC filing assistance.
Keep in mind that while these companies can supply valuable support, it’s constantly a good idea to have a fundamental understanding of the ERC requirements and procedure yourself. This will assist you make informed decisions and make sure accurate filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief steps. The goal of the ERC is to motivate organizations to retain and pay their workers during the pandemic, even if their operations have actually been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is readily available to eligible employers, consisting of for-profit businesses, tax-exempt companies, and certain governmental entities. To qualify, employers need to satisfy one of two criteria:.
The business operations were completely or partly suspended due to a federal government order related to COVID-19.
The business experienced a considerable decline in gross receipts. As discussed previously, for 2021, a considerable decrease is defined as a 20% decrease in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a significant decrease is specified as a 20% decrease in gross receipts compared to the very same quarter in 2019, or a 20% decrease in gross invoices compared to the right away preceding quarter.
Credit Amount: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit amount amounts to a portion (as much as 70%) of certified incomes paid to staff members, consisting of particular health insurance expenditures. The maximum credit per worker is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, organizations that got an Income Security Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 enables services to declare the ERC even if they got a PPP loan. The exact same salaries can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively broadened and improved, enabling qualified employers to declare the credit for qualified wages paid as far back as March 13, 2020. This retroactive arrangement supplies an opportunity for companies to change prior-year tax returns and get refunds.
Declaring the Credit: Companies can claim the ERC by reporting it on their employment tax returns, normally Kind 941. The excess can be reimbursed to the company if the credit surpasses the amount of employment taxes owed.
It’s important to note that the ERC provisions and eligibility criteria have developed in time. The very best course of action is to speak with a tax professional or visit the official internal revenue service website for the most detailed and up-to-date information relating to the ERC, consisting of any current legislative modifications or updates.
To receive the ERC, a service should meet among the following criteria:.
The business operations were completely or partially suspended due to a federal government order related to COVID-19.
Business experienced a substantial decrease in gross receipts. For 2021, a significant decrease is specified as a 20% decrease in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a substantial decrease is specified as a 20% decline in gross receipts compared to the same quarter in 2019, or a 20% decline in gross receipts compared to the immediately preceding quarter.
The ERC is available to services of all sizes, consisting of tax-exempt companies, but there are some exceptions. Federal government entities and organizations that received a PPP loan may have restrictions on claiming the credit.
The procedure for claiming the ERC involves completing the essential forms and including the credit on your work income tax return (typically Type 941). The exact time it requires to process the credit can differ based upon a number of factors, consisting of the intricacy of your business and the workload of the internal revenue service. It’s suggested to talk to a tax expert for assistance specific to your scenario.
There are numerous companies that can assist with the process of declaring the ERC. Some widely known business that offer assistance with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the information provided here is based upon basic understanding and may not reflect the most recent updates or modifications to the ERC. It is very important to consult with a tax expert or go to the official internal revenue service website for the most current and precise info regarding eligibility, claiming treatments, and readily available support.
Less than 100. If the employer had 100 or less employees usually in 2019, then the credit is based.
on salaries paid to all staff members whether they really worked or not. In other words, even if the.
workers worked full-time and made money for full time work, the employer still gets the credit.
Greater than 100. If the company had more than 100 staff members on average in 2019, then the credit is.
allowed only for earnings paid to employees who did not work throughout the calendar quarter.
In both cases, “incomes” includes not simply money payments but also a part of the expense of employer.
offered healthcare. Employee Retention Credit 2022 Self Employed
Companies can be right away repaid for the credit by minimizing the quantity of payroll taxes they.