Lets talk first about Employee Retention Credit Employees :
Our group here what do these people doing everyone in this room is assisting teach people about ERC and uh always supply a lovely breakfast and have individuals truly discover the program we must head to the room where we are able to display a few of the checks that we are getting for companies and I ‘d like to see that what is this this is uh hundreds of countless dollars literally Kevin hundreds of millions of dollars so these are replicate copies of the letters that go to clients validating that the check is on the method I suggest you know if you just start 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 just I suggest think of the number of actual 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 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
get this you know the check is chosen sure which’s when they pay so they do not pay anything up until they in fact receive the money they don’t pay bottom line Wonder trust anything till this letter is validated the check is on the way they deposit it into their checking account and they can genuinely trust Wonder trust that the procedure has been completed and the number of you believe you have actually processed given that you started this we’re about 35 000 of these for
about 6 billion dollars wow so plainly they know what they’re doing and that’s what you need 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 really crucial today the staff member retention credit which the majority of you have actually never ever heard of I certainly hadn’t become aware of it up until really recently and found out a lot about it due to the fact that this is probably the lowest expense of capital for any small business anywhere
anytime if you have workers between five and five hundred so I’ve got the specialist with me this is Josh Fox he’s the creator and CEO of bottom line Principles 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 call up your bank supervisor and state offer me a loan it does not work there’s not a loan it’s an application and Josh is going to tell 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 love this program it’s disappearing soon you got to find out everything about it let’s talk employee retention credit Josh Fox what is an ERC let’s just start there so during the Trump Administration when President Trump was enacted they came up with the cares Act and the cares act used businesses 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 2 of them are loans and one’s a refund exactly so the ERC is a refund that’s.
remedy the money money payroll tax refund fine go on sorry I simply have to ensure we got that point I suggest that’s a big difference a loan versus money cash I like cash cash 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 initial cares Act is the ERC and yes Kevin it is a gorgeous tough check in the mail where you get real cash from the IRS all right so let’s talk about how it works because it seems like to me if it’s a if it’s employee retention credit that person needed to be an employee so I’m going to make the Presumption this cash 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 a company however it’s based on you having W-2 employees 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 very first six months of 2021 on the W-2 proper so there were six quarters the program was open well stroll us through the 6 quarters so you had quarters 2 three and 4 of 2020 and you had quarters one 2 and 3 of 2021. all right so that’s how it’s measured you need to be on the W-2 throughout that period now let’s talk my preferred part money how much can you return per worker that was on a W-2 in those 6 quarters so the computation in 2020 to be specific 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 skyrocketed to 70 of the staff member’s salary to an optimum of seven thousand per quarter how did that occur um they simply altered the rules in.
2021 versus due to the fact that the turmoil of the pandemic so they wanted to even get more to keep those workers 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 come up with twenty 6 thousand twenty one thousand to twenty twenty one plus five 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 caution here the PPP money would have to be reduced from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan 2 you would reduce the 26 000 so what we’re seeing usually Kevin is if you took PPP money somewhere around ten thousand dollars an individual so let’s state hypothetically you owned a dining establishment in New york city City where I’m from and you had a hundred workers and you took PPP cash you would still get a million dollar in the mail from the internal revenue service so it’s big clearly now the big question is why does nobody learn about this due to the fact that appearance when I first heard about this when I initially satisfied Josh you know I’ve got lots of financial investments in lots of companies I’m a significant advocate for entrepreneurship in America and make many lots of financial investments in entrepreneurs of which numerous suffered through the pandemic when I first became aware of this I called BS I don’t believe it due to the fact that I use the PPP we went through the money center Banks to get it it was very easy to do we had our CEOs call the banks they got their loans which were well been worthy of and we utilized them carefully to survive throughout the pandemic so when I heard about this I stated nah it can’t be true but when I dug around I even contacted us to my politician friends Guv Senators they didn’t know about it I suggest that’s how you understand that’s how misinformation is that there’s no information out there then a bunch of individuals informed me well you can’t get it since you took the PPP likewise not real so let’s ask Josh why does no one learn about the worker retention credit you know what’s interesting you’re speaking about the banks Kevin due to the fact that in the PPP loan process 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 country and they would process process in Canada a pre-pp loan there’s no loans in Canada by the way it’s simply process process that’s all um and here there was turmoil because remember in the initial cares act you might not do both programs so if you had actually done PPP you might refrain from doing ERC in the initial program and when they changed 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 made it clear to anyone about how to.
do this does your CFO understand how to do this not truly he or she’s never ever done it in the past do the banks do it nope the banks don’t do it the payroll companies yeah a few 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 went into this service and bottom line my company Kevin has actually stayed in business because 2009 and we have actually been dealing with the federal government and the state federal government to recover cash for Fortune 500 Fortune 1000 business so a great deal of our huge huge corporate clients have dealt with bottom line to recuperate other government programs we’ve done sales tax and utilize tax unemployment tax work opportunity tax credits research and development tax credits unclaimed property property tax all of these other government programs.
The employee retention tax credit is a broad based refundable tax credit designed to motivate.
companies to keep employees on their payroll. The credit is 50% of up to $10,000 in salaries paid by an.
Due to the fact that of COVID-19 or whose gross invoices, employer whose company is completely or partly suspended.
decline by more than 50%.
1. The credit is readily available to all employers despite size including tax exempt organizations. There are.
only 2 exceptions: (1) state and local governments and their instrumentalities and (2) small.
organizations who take Small Business Loans.
2. To certify, the employer needs to satisfy one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the company’s company is completely or partly suspended by federal 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. When the.
employer’s gross invoices go above 80% of a comparable quarter in 2019 they no longer qualify.
after the end of that quarter.
Computation of the Credit.
The amount of the credit is 50% of the certifying wages paid up to $10,000 in overall.
It works for wages paid after March 13th and prior to December 31, 2020.
The definition of certifying wages varies by whether a company had, on average, more or less than.
100 staff members in 2019.
Business that focus on ERC filing assistance usually supply know-how and support to assist companies navigate the complicated procedure of claiming the credit. They can provide different services, including:.
How is the employee retention credit calculated? Employee Retention Credit Employees
Eligibility Evaluation: These business will examine your business’s eligibility for the ERC based upon factors such as your market, profits, and operations. If you fulfill the requirements for the credit and recognize the maximum credit amount you can declare, they can help figure out.
Documentation and Computation: ERC filing services will assist in gathering the necessary documents, such as payroll records and monetary declarations, to support your claim. They will likewise help compute the credit quantity based upon qualified earnings and other qualifying expenditures.
Retroactive Claim Evaluation: If you are eligible to claim the ERC for previous quarters, these companies can examine your previous payroll records and financials to recognize potential opportunities for retroactive credits. They can assist you change prior tax returns to claim these refunds.
Filing Support: Companies specializing in ERC filings will prepare and submit the necessary forms and documents on your behalf. This includes finishing Form 941 or any other necessary tax return.
Compliance and Updates: ERC policies and assistance have actually developed gradually. These companies stay updated with the latest modifications and ensure that your filings adhere to the most current guidelines. If the IRS demands extra details or conducts an audit associated to your ERC claim, they can also supply continuous assistance.
It is essential to research and vet any business providing ERC filing help to ensure their reliability and expertise. Search for established firms with experience in tax and payroll services, or think about connecting to trusted accounting companies or tax professionals who offer ERC filing support.
Keep in mind that while these companies can offer important support, it’s constantly a great concept to have a standard understanding of the ERC requirements and procedure yourself. This will help you make informed decisions and ensure accurate filings.
The Worker Retention Credit (ERC) is a refundable tax credit introduced by the U.S. federal government as part of COVID-19 relief measures. The goal of the ERC is to motivate businesses to keep and pay their workers during the pandemic, even if their operations have been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is available to qualified companies, consisting of for-profit services, tax-exempt organizations, and particular governmental entities. To certify, companies need to satisfy one of two requirements:.
The business operations were completely or partly suspended due to a government order related to COVID-19.
The business experienced a substantial decrease in gross receipts. As discussed previously, for 2021, a significant decrease is defined as a 20% decline in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a significant decrease is defined as a 20% decrease in gross invoices compared to the exact same quarter in 2019, or a 20% decline in gross invoices compared to the right away preceding quarter.
Credit Amount: The ERC is a refundable tax credit that offsets the employer’s share of Social Security taxes. The credit quantity is equal to a portion (up to 70%) of qualified earnings paid to staff members, including particular health plan expenses. 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, companies that got a Paycheck Defense Program (PPP) loan were not eligible for the ERC. However, legislation passed in late 2020 and extended in 2021 allows services to declare the ERC even if they received a PPP loan. The very same incomes can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively expanded and improved, enabling qualified employers to declare the credit for certified wages paid as far back as March 13, 2020. This retroactive provision provides an opportunity for organizations to modify prior-year income tax return and get refunds.
Claiming the Credit: Companies can claim the ERC by reporting it on their work income tax return, generally Form 941. If the credit surpasses the quantity of work taxes owed, the excess can be refunded to the company.
It’s important to note that the ERC provisions and eligibility requirements have progressed in time. The best strategy is to speak with a tax expert or check out the official internal revenue service website for the most up-to-date and detailed information relating to the ERC, including any current legislative changes or updates.
To qualify for the ERC, an organization needs to meet among the following requirements:.
The business operations were completely or partially suspended due to a government order related to COVID-19.
Business experienced a considerable decrease in gross invoices. For 2021, a considerable decline 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 invoices compared to the same quarter in 2019, or a 20% decrease in gross receipts compared to the instantly preceding quarter.
The ERC is offered to organizations of all sizes, including tax-exempt organizations, however there are some exceptions. For example, government entities and companies that received a PPP loan might have restrictions on claiming the credit.
The process for claiming the ERC involves finishing the essential types and including the credit on your work tax return (generally Type 941). The exact time it takes to process the credit can vary based upon a number of elements, including the intricacy of your organization 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 several companies that can assist with the process of declaring the ERC. These include accounting firms, tax advisory services, and payroll provider. Some widely known companies that use help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s suggested to research and get in touch with these companies straight to ask about their fees and services.
Please keep in mind that the information offered here is based upon basic understanding and might not reflect the most recent updates or changes to the ERC. It is essential to seek advice from a tax professional or visit the main IRS site for the most up-to-date and precise information relating to eligibility, claiming treatments, and available help.
Less than 100. If the employer had 100 or less staff members usually in 2019, then the credit is based.
on wages paid to all workers whether they really worked or not. Simply put, even if the.
employees worked full-time and got paid for full time work, the company 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 wages paid to employees who did not work throughout the calendar quarter.
In both cases, “incomes” consists of not just money payments but likewise a part of the cost of company.
offered healthcare. Employee Retention Credit Employees
Companies can be right away reimbursed for the credit by lowering the quantity of payroll taxes they.