Lets talk first about Employee Retention Credit Act :
Our team here what do these men doing everyone in this room is helping teach people about ERC and uh constantly provide a stunning breakfast and have people really learn about the program we need to head to the space where we are able to display a few of the checks that we are getting for companies and I wish to see that what is this this is uh numerous countless dollars actually Kevin hundreds of millions of dollars so these are replicate copies of the letters that go to customers validating that the check is on the way I mean you understand if you just begin to look at a few 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 simply I indicate think about how many actual 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 validated and the check is on the mail in the mail from the IRS heading to the consumer so that’s how you’re able to track it you know when you
receive this you know the check is opted for sure which’s when they pay so they don’t pay anything until they really receive the money they don’t 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 genuinely trust Wonder trust that the procedure has been ended up and the number of you believe you have actually processed considering that you began this we have to do with 35 000 of these for
about 6 billion dollars wow so plainly they understand what they’re doing which’s what you require you require 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 Fantastic here you’re at my YouTube channel we’re speaking about something truly important today the employee retention credit which most of you have actually never ever heard of I definitely hadn’t become aware of it till really recently and discovered a lot about it since this is probably the lowest expense of capital for any small business anywhere
anytime if you have employees between five and five hundred so I have actually got the expert 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 challenging this isn’t like PPP we simply call your bank supervisor 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 learn everything about it let’s talk staff member retention credit Josh Fox what is an ERC let’s simply begin there so during the Trump Administration when President Trump was enacted they created the cares Act and the cares act provided organizations three opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically everyone it makes a big difference right there two of them are loans and one’s a refund precisely so the ERC is a refund that’s.
correct the cash money payroll tax refund all right go on sorry I simply need to make sure we got that point I imply that’s a big difference a loan versus money cash I like money 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 hard check in the mail where you get real money from the IRS all right so let’s talk about how it works since it seems like to me if it’s a if it’s employee retention credit that individual had to be a worker so I’m going to make the Presumption this cash is not for the owner not for people on the cap table not for shareholders it’s for staff members right you needed to have owned a company however it’s based upon you having W-2 employees in America not 10.99. so as long as you had W-2 workers 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 very first 6 months of 2021 on the W-2 appropriate so there were 6 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 two and three of 2021. all right 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 money how much can you get back per staff member that was on a W-2 in those six quarters so the estimation in 2020 to be precise Kevin is 50 of the worker’s wage to an optimum of 5 thousand dollars per employee for the year of 2020 and in 2021 the numbers escalated to 70 of the worker’s salary to an optimum of 7 thousand per quarter how did that take place um they simply altered the rules in.
2021 versus since the mayhem 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 as much as five thousand Max and after that what happens 21 000 Max in 2021 oh that’s how you create twenty six thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty six thousand dollars per employee that is because that’s a lot of money it is now there’s a caveat 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 two you would reduce the 26 000 so what we’re seeing usually Kevin is if you took PPP cash somewhere around ten thousand dollars a person so let’s say hypothetically you owned a restaurant 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 IRS so it’s substantial clearly now the huge question is why does nobody understand about this due to the fact that appearance when I initially became aware of this when I initially fulfilled Josh you know I’ve got lots of investments in lots of business I’m a major advocate for entrepreneurship in America and make lots of numerous financial investments in business owners of which numerous suffered through the pandemic when I first heard about this I called BS I do not think it since I use 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 utilized them wisely to survive throughout the pandemic so when I heard about this I stated nah it can’t be true however when I dug around I even contacted us to my political leader friends Guv Senators they didn’t know about it I mean that’s how you know that’s how misinformation is that there’s no details out there then a bunch of individuals informed me well you can’t get it due to the fact that you took the PPP likewise not real so let’s ask Josh why does nobody learn about the worker retention credit you understand what’s fascinating you’re talking about the banks Kevin due to the fact that in the PPP loan process the federal government made it very clear that if you desired 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 simply procedure procedure that’s all um and here there was mayhem because remember in the initial cares act you could not do both programs so if you had actually done PPP you could refrain from doing ERC in the original program and when they changed the law in 2021 the banks were refraining from 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 any person about how to.
do this does your CFO understand how to do this not really she or he’s never ever done it previously do the banks do it nope the banks don’t do it the payroll business yeah a few of them are doing it as a payroll company your accounting professional no your accounting professional’s never ever done this prior to unless you have an account that went into this organization and bottom line my firm Kevin has been in business considering that 2009 and we have actually been dealing with the federal government and the state government to recuperate cash for Fortune 500 Fortune 1000 business so a lot of our huge big corporate clients 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 home property tax all of these other federal government programs.
The staff member retention tax credit is a broad based refundable tax credit designed to encourage.
companies to keep workers on their payroll. The credit is 50% of as much as $10,000 in incomes paid by an.
employer whose company is totally or partially suspended because of COVID-19 or whose gross invoices.
decline by more than 50%.
1. The credit is available to all employers no matter size consisting of tax exempt companies. There are.
only two exceptions: (1) state and local governments and their instrumentalities and (2) little.
businesses who take Small Business Loans.
2. To qualify, the company has to meet one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the company’s organization is fully or partly suspended by government order due to COVID-19.
during the calendar quarter or.
o the employer’s gross invoices are listed below 50% of the equivalent quarter in 2019. When the.
company’s gross invoices go above 80% of an equivalent quarter in 2019 they no longer certify.
after completion of that quarter.
Estimation 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 prior to December 31, 2020.
The definition of qualifying earnings varies by whether an employer had, usually, basically than.
100 workers in 2019.
Companies that focus on ERC filing assistance usually offer knowledge and assistance to help organizations browse the complicated process of claiming the credit. They can provide different services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit Act
Eligibility Evaluation: These companies will evaluate your organization’s eligibility for the ERC based on factors such as your industry, earnings, and operations. They can assist figure out if you meet the requirements for the credit and identify the optimum credit amount you can declare.
Paperwork and Computation: ERC filing services will help in collecting the needed documents, such as payroll records and monetary statements, to support your claim. They will also assist compute the credit quantity based upon eligible salaries and other qualifying expenses.
Retroactive Claim Review: If you are qualified to declare the ERC for previous quarters, these business can examine your previous payroll records and financials to identify potential chances for retroactive credits. They can assist you amend previous tax returns to claim these refunds.
Filing Assistance: Business specializing in ERC filings will prepare and submit the required forms and documentation in your place. This includes finishing Kind 941 or any other required tax return.
Compliance and Updates: ERC regulations and guidance have actually progressed in time. These business stay updated with the latest changes and guarantee that your filings abide by the most current guidelines. They can also supply continuous assistance if the IRS requests extra 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 trustworthiness and knowledge. Look for recognized companies with experience in tax and payroll services, or think about reaching out to trusted accounting firms or tax professionals who offer ERC filing support.
Remember that while these companies can supply valuable assistance, it’s constantly an excellent idea to have a basic understanding of the ERC requirements and procedure yourself. This will help you make informed choices and guarantee precise filings.
The Employee Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief measures. The objective of the ERC is to encourage services to maintain and pay their staff members throughout the pandemic, even if their operations have been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is available to eligible employers, including for-profit services, tax-exempt organizations, and particular governmental entities. To qualify, companies must satisfy one of two requirements:.
Business operations were completely or partially suspended due to a government order related to COVID-19.
Business experienced a significant decline in gross receipts. As mentioned earlier, for 2021, a significant decline is specified as a 20% decrease in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a considerable decrease is defined as a 20% decline in gross invoices compared to the exact same quarter in 2019, or a 20% decline in gross receipts compared to the right away 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 (approximately 70%) of certified incomes paid to workers, including specific health plan 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, companies that got an Income Defense Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 allows businesses to claim the ERC even if they got a PPP loan. However, the very same incomes can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has actually been retroactively expanded and enhanced, allowing qualified employers to declare the credit for certified salaries paid as far back as March 13, 2020. This retroactive arrangement offers an opportunity for services to amend prior-year tax returns and get refunds.
Claiming the Credit: Employers can claim the ERC by reporting it on their employment tax returns, generally Form 941. If the credit goes beyond the amount of work taxes owed, the excess can be refunded to the company.
It is necessary to keep in mind that the ERC provisions and eligibility requirements have actually developed gradually. The very best strategy is to consult with a tax professional or go to the official IRS website for the most comprehensive and updated details regarding the ERC, including any recent legislative modifications or updates.
To get approved for the ERC, a service needs to fulfill one of the following requirements:.
The business operations were completely or partly suspended due to a government order related to COVID-19.
The business experienced a considerable decline in gross invoices. For 2021, a significant decline is defined as a 20% decrease in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a substantial decline is defined as a 20% decrease in gross invoices compared to the same quarter in 2019, or a 20% decline in gross receipts compared to the immediately preceding quarter.
The ERC is offered to services of all sizes, consisting of tax-exempt companies, however there are some exceptions. For instance, government entities and companies that received a PPP loan might have constraints on claiming the credit.
The procedure for claiming the ERC includes finishing the required forms and consisting of the credit on your work tax return (normally Type 941). The exact time it takes to process the credit can differ based upon numerous elements, including the intricacy of your business and the workload of the internal revenue service. It’s suggested to consult with a tax professional for guidance particular to your scenario.
There are several business that can help with the process of claiming the ERC. Some widely known business that offer support with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the details offered here is based upon general knowledge and might not reflect the most recent updates or modifications to the ERC. It is essential to speak with a tax expert or go to the official internal revenue service website for the most precise and up-to-date info regarding eligibility, declaring treatments, and available assistance.
Less than 100. The credit is based if the company had 100 or fewer workers on average in 2019.
on earnings paid to all workers whether they really worked or not. To put it simply, even if the.
staff members worked full-time and earned money for full-time work, the employer still gets the credit.
Greater than 100. If the employer had more than 100 workers on average in 2019, then the credit is.
allowed just for wages paid to workers who did not work throughout the calendar quarter.
In both cases, “salaries” includes not simply cash payments however also a portion of the cost of employer.
provided healthcare. Employee Retention Credit Act
Companies can be right away repaid for the credit by decreasing the quantity of payroll taxes they.