Lets talk first about Employee Retention Credit Eligibility :
Our group here what do these guys doing everybody in this room is helping teach people about ERC and uh always supply a beautiful breakfast and have individuals actually discover the program we ought to head to the space where we have the ability to show some of the checks that we are getting for companies and I ‘d like to see that what is this this is uh numerous countless dollars actually Kevin numerous countless dollars so these are replicate copies of the letters that go to clients verifying that the check is on the way I imply you know if you simply start to take a 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 imply it’s just I imply consider the number of actual customers that went through the program yeah this is the very end this is the celebration at the end when the check is verified 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 have the ability to track it you know when you
get this you know the check is chosen sure which’s when they pay so they do not pay anything till they in fact receive the money they do not pay bottom line Wonder trust anything till this letter is verified the check is on the method they deposit it into their bank account and they can truly rely on Wonder trust that the procedure has been ended up and how many you believe you have actually processed since you started this we have to do with 35 000 of these for
about six billion dollars wow so clearly they understand what they’re doing and that’s what you require you require professionals 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 essential today the employee retention credit which the majority of you have never heard of I certainly hadn’t become aware of it up until really just recently and found out a lot about it due to the fact that this is most likely the lowest cost of capital for any small business anywhere
anytime if you have workers in between five and five hundred so I have actually got the specialist with me this is Josh Fox he’s the founder and CEO of bottom line Principles 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 just call 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 all of us about it and how to get it and why I’ve become yes the Ambassador and paid representative for this I enjoy this program it’s going away very soon you got to learn all about it let’s talk staff member retention credit Josh Fox what is an ERC let’s simply begin there so throughout the Trump Administration when President Trump was enacted they developed the cares Act and the cares act offered businesses three chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly everyone it makes a huge difference right there 2 of them are loans and one’s a refund exactly so the ERC is a refund that’s.
remedy the cash cash payroll tax refund okay go on sorry I just need to ensure we got that point I indicate that’s a big difference a loan versus cash cash I like cash cash 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 beautiful tough check in the mail where you get actual money from the internal revenue service all right so let’s speak about how it works because it sounds like to me if it’s a if it’s staff member retention credit that individual 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 investors it’s for workers right you needed to have actually owned an organization but it’s based on you having W-2 employees in America not 10.99. As long as you had W-2 staff members and you paid federal payroll taxes that’s why you would be eligible so you have to be on payroll in 2020 on the W-2 and you have to be on payroll for the very first six months of 2021 on the W-2 proper so there were six quarters the program was open well walk us through the six quarters so you had quarters two three and 4 of 2020 and you had quarters one 2 and three of 2021. fine so that’s how it’s measured you need to be on the W-2 throughout that period 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 computation in 2020 to be precise Kevin is 50 of the worker’s wage to an optimum of five thousand dollars per employee for the year of 2020 and in 2021 the numbers increased to 70 of the worker’s salary to a maximum of seven thousand per quarter how did that take place um they just altered the rules in.
2021 versus since the chaos of the pandemic so they wished 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 approximately five thousand Max and after that what happens 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 employee that is since that’s a great deal of cash it is now there’s a caveat here the PPP cash would need to be minimized from the twenty six 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 cash somewhere around 10 thousand dollars a person so let’s state 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 big undoubtedly now the huge concern is why does no one learn about this because look when I first found out about this when I first fulfilled Josh you know I have actually got great deals of financial investments in lots of companies I’m a significant advocate for entrepreneurship in America and make many numerous investments in business owners of which numerous suffered through the pandemic when I initially heard about this I called BS I don’t 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 which were well deserved and we used them sensibly to stay alive during the pandemic so when I heard about this I said nah it can’t be true but when I dug around I even contacted us to my politician pals 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 details out there then a lot of individuals informed 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 worker retention credit you understand what’s intriguing you’re discussing the banks Kevin because in the PPP loan procedure 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 big banks in our country 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 turmoil due to the fact that keep in mind in the initial cares act you could refrain from doing both programs so if you had done PPP you could refrain from doing ERC in the initial program and when they altered 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 ever 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 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 business your accountant no your accounting professional’s never done this prior to unless you have an account that entered into this organization and bottom line my company Kevin has actually stayed in business because 2009 and we’ve been working with the federal government and the state federal government to recuperate money for Fortune 500 Fortune 1000 companies so a lot of our big huge business clients have actually dealt with bottom line to recuperate other government programs we’ve done sales tax and use tax unemployment tax work opportunity tax credits research and development tax credits unclaimed property real estate tax all of these other government programs.
The worker retention tax credit is a broad based refundable tax credit created to encourage.
employers to keep staff members on their payroll. The credit is 50% of as much as $10,000 in earnings paid by an.
Because of COVID-19 or whose gross receipts, employer whose service is totally or partially suspended.
decline by more than 50%.
1. The credit is readily available to all companies no matter size consisting of tax exempt organizations. There are.
just two exceptions: (1) state and local governments and their instrumentalities and (2) little.
companies who take Small Business Loans.
2. To certify, the company needs to fulfill one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the company’s service is totally or partly suspended by federal government order due to COVID-19.
during the calendar quarter or.
o the employer’s gross receipts are below 50% of the equivalent quarter in 2019. When the.
employer’s gross invoices exceed 80% of a comparable quarter in 2019 they no longer qualify.
after completion of that quarter.
Computation of the Credit.
The amount of the credit is 50% of the qualifying earnings paid up to $10,000 in overall.
It works for wages paid after March 13th and before December 31, 2020.
The definition of qualifying incomes varies by whether an employer had, typically, more or less than.
100 staff members in 2019.
Business that specialize in ERC filing help generally supply competence and support to assist organizations navigate the intricate procedure of declaring the credit. They can offer numerous services, including:.
How is the employee retention credit calculated? Employee Retention Credit Eligibility
Eligibility Assessment: These business will examine your company’s eligibility for the ERC based on factors such as your industry, earnings, and operations. They can assist identify if you meet the requirements for the credit and determine the maximum credit quantity you can declare.
Documents and Computation: ERC filing services will assist in collecting the essential paperwork, such as payroll records and financial declarations, to support your claim. They will also help determine the credit amount based on eligible incomes and other certifying expenses.
Retroactive Claim Evaluation: If you are qualified to declare the ERC for previous quarters, these business can review your past payroll records and financials to determine possible opportunities for retroactive credits. They can assist you modify previous tax returns to declare these refunds.
Filing Assistance: Business focusing on ERC filings will prepare and submit the necessary types and paperwork on your behalf. This includes finishing Type 941 or any other necessary tax return.
Compliance and Updates: ERC policies and guidance have actually evolved in time. These business remain updated with the current changes and ensure that your filings adhere to the most present guidelines. They can also provide ongoing support if the IRS requests extra details or conducts an audit related to your ERC claim.
It is essential to research and veterinarian any business offering ERC filing support to guarantee their reliability and expertise. Look for recognized firms with experience in tax and payroll services, or think about connecting to trusted accounting firms or tax experts who use ERC submitting assistance.
Keep in mind that while these business can offer important support, it’s constantly a good concept to have a standard understanding of the ERC requirements and process yourself. This will help you make notified choices and make sure 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 steps. The objective of the ERC is to encourage services to maintain and pay their workers throughout the pandemic, even if their operations have been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is offered to eligible employers, consisting of for-profit organizations, tax-exempt organizations, and certain governmental entities. To qualify, companies should meet one of two criteria:.
The business operations were fully or partly suspended due to a government order related to COVID-19.
The business experienced a substantial decrease in gross invoices. As mentioned previously, 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 decline is specified as a 20% decrease in gross invoices compared to the exact same quarter in 2019, or a 20% decrease in gross receipts 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 quantity is equal to a percentage (up to 70%) of qualified wages paid to employees, consisting of particular 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, services that got an Income Protection Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 permits companies to declare the ERC even if they received a PPP loan. The exact same earnings can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively expanded and boosted, allowing eligible companies to declare the credit for certified earnings paid as far back as March 13, 2020. This retroactive arrangement supplies an opportunity for organizations to modify prior-year tax returns and receive refunds.
Claiming the Credit: Companies can declare the ERC by reporting it on their work income tax return, normally Form 941. The excess can be refunded to the employer if the credit exceeds the quantity of work taxes owed.
It is very important to keep in mind that the ERC provisions and eligibility requirements have evolved in time. The very best strategy is to speak with a tax expert or visit the official IRS website for the most updated and comprehensive info regarding the ERC, including any current legal modifications or updates.
To get approved for the ERC, a service must fulfill among the following requirements:.
Business operations were totally or partially suspended due to a federal government order related to COVID-19.
The business experienced a significant decline in gross receipts. For 2021, a considerable decline is defined as a 20% decline in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a considerable decrease is defined as a 20% decrease in gross invoices compared to the same quarter in 2019, or a 20% decline in gross invoices compared to the immediately preceding quarter.
The ERC is available to businesses of all sizes, including tax-exempt organizations, but there are some exceptions. Government entities and companies that got a PPP loan may have limitations on declaring the credit.
The process for claiming the ERC includes finishing the necessary kinds and including the credit on your work tax return (generally Kind 941). The exact time it takes to process the credit can differ based upon a number of elements, including the intricacy of your company and the work of the internal revenue service. It’s recommended to talk to a tax expert for assistance specific to your situation.
There are several business that can assist with the procedure of declaring the ERC. Some well-known business that provide help with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the info offered here is based on basic knowledge and may not show the most recent updates or changes to the ERC. It is very important to seek advice from a tax expert or go to the official internal revenue service site for the most current and precise information concerning eligibility, claiming procedures, and offered 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 employees 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. If the employer had more than 100 employees typically in 2019, then the credit is.
enabled only for salaries paid to employees who did not work during the calendar quarter.
In both cases, “salaries” includes not just cash payments but also a part of the cost of employer.
provided healthcare. Employee Retention Credit Eligibility
Employers can be immediately compensated for the credit by minimizing the amount of payroll taxes they.