Lets talk first about Employee Retention Credit Extended :
Our team here what do these men doing everyone in this room is assisting teach individuals about ERC and uh always supply a stunning breakfast and have individuals actually learn more about the program we should head to the room where we have the ability to show a few of the checks that we are getting for companies and I wish to see that what is this this is uh hundreds of countless dollars actually Kevin numerous millions of dollars so these are replicate copies of the letters that go to customers verifying that the check is on the method I indicate you understand if you simply start to take a look at some of these here I imply this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I mean it’s just I mean think about 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 validated the numbers are confirmed and the check is on the mail in the mail from the IRS heading to the client so that’s how you have the ability to track it you know when you
get this you understand the check is gone for sure and that’s when they pay so they do not pay anything till they really receive the cash they don’t pay bottom line Wonder trust anything till this letter is confirmed the check is on the method they deposit it into their savings account and they can truly rely on Wonder trust that the procedure has actually been ended up and how many you believe 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 understand what they’re doing and that’s what you need you need specialists on the other end of the phone to process this and get it to where you get one of these that’s what matters all right Mr Wonderful here you’re at my YouTube channel we’re discussing something actually essential today the worker retention credit which the majority of you have never heard of I definitely had not heard of it until really recently and learned a lot about it because this is probably the most affordable expense of capital for any small company anywhere
anytime if you have employees between 5 and five hundred so I have actually got the professional 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 not easy this isn’t like PPP we simply phone your bank supervisor and state provide 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 have actually ended up being yes the Ambassador and paid representative for this I like this program it’s disappearing very soon you got to learn everything about it let’s talk worker retention credit Josh Fox what is an ERC let’s simply start there so during the Trump Administration when President Trump was enacted they created 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 almost everyone it makes a big difference right there two of them are loans and one’s a refund exactly so the ERC is a refund that’s.
fix the money money payroll tax refund alright go on sorry I simply need to make sure we got that point I mean that’s a huge difference a loan versus money money I like cash cash that’s what we’re talking about 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 lovely difficult check in the mail where you get actual cash from the IRS all right so let’s discuss how it works due to the fact that it sounds like to me if it’s a if it’s worker retention credit that individual needed to be a worker 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 owned an organization however it’s based on you having W-2 employees in America not 10.99. 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 have to be on payroll for the first 6 months of 2021 on the W-2 correct so there were six quarters the program was open well walk us through the 6 quarters so you had quarters two three and 4 of 2020 and you had quarters one 2 and three of 2021. alright so that’s how it’s measured you have to be on the W-2 throughout that duration now let’s talk my preferred part cash just how much can you get back per worker that was on a W-2 in those six quarters so the calculation in 2020 to be precise 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 skyrocketed to 70 of the worker’s wage to a maximum of seven thousand per quarter how did that take place um they simply altered the rules in.
2021 versus because the chaos of the pandemic so they wanted 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 then 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 staff member that is because that’s a great deal of money it is now there’s a caveat here the PPP cash would have to be reduced 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 typically Kevin is if you took PPP cash somewhere around 10 thousand dollars an individual so let’s state hypothetically you owned a restaurant in New york city 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 certainly now the big question is why does no one understand about this due to the fact that appearance when I first found out about this when I first met Josh you understand I have actually got great deals of financial investments in great deals of companies I’m a major supporter for entrepreneurship in America and make many numerous investments in business owners of which lots of suffered through the pandemic when I first heard about 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 really easy to do we had our CEOs call the banks they got their loans and that were well deserved and we utilized them sensibly to stay alive throughout 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 buddies Governor Senators they didn’t learn about it I indicate that’s how you understand 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 true so let’s ask Josh why does no one learn about the employee 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 desired a PPP loan you would call Wells Fargo Citibank Bank of America any of the big banks in our nation and they would process procedure in Canada a pre-pp loan there’s no loans in Canada by the way it’s simply process procedure that’s all um and here there was turmoil since keep in mind in the original cares act you could not do both programs so if you had done PPP you might refrain from doing ERC in the initial program and when they altered the law in 2021 the banks were not doing ERC since 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 he or she’s never done it previously do the banks do it nope the banks do not do it the payroll business yeah some of them are doing it as a payroll company your accountant no your accounting professional’s never ever done this prior to unless you have an account that entered into this organization and bottom line my company Kevin has stayed in business since 2009 and we have actually been working with the federal government and the state government to recover money for Fortune 500 Fortune 1000 business so a lot of our big huge corporate clients have dealt with bottom line to recover other federal government programs we have actually done sales tax and utilize tax unemployment tax work opportunity 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 developed to motivate.
companies to keep staff members 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, employer whose company is completely or partially suspended.
decrease by more than 50%.
Availability.
1. The credit is offered to all employers no matter size consisting of tax exempt companies. There are.
only 2 exceptions: (1) state and local governments and their instrumentalities and (2) small.
companies who take Small company Loans.
2. To qualify, the company has to meet one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the company’s service is completely or partially suspended by federal 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. When the.
company’s gross receipts exceed 80% of a comparable quarter in 2019 they no longer certify.
after the end of that quarter.
Calculation of the Credit.
The amount of the credit is 50% of the qualifying salaries paid up to $10,000 in overall.
It works for incomes paid after March 13th and prior to December 31, 2020.
The meaning of qualifying earnings varies by whether an employer had, on average, more or less than.
100 staff members in 2019.
Companies that concentrate on ERC filing assistance generally supply knowledge and support to help services browse the complicated process of claiming the credit. They can use numerous services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit Extended
Eligibility Evaluation: These business will evaluate your company’s eligibility for the ERC based on elements such as your industry, income, and operations. They can assist determine if you meet the requirements for the credit and recognize the optimum credit amount you can declare.
Documents and Estimation: ERC filing services will assist in gathering the needed documents, such as payroll records and monetary declarations, to support your claim. They will likewise help determine the credit quantity based upon qualified earnings and other qualifying expenditures.
Retroactive Claim Evaluation: If you are qualified to claim the ERC for prior quarters, these business can review your past payroll records and financials to identify possible opportunities for retroactive credits. They can assist you amend prior tax returns to declare these refunds.
Filing Help: Companies concentrating on ERC filings will prepare and send the required forms and paperwork in your place. This includes completing Form 941 or any other necessary tax forms.
Compliance and Updates: ERC regulations and guidance have progressed gradually. These business remain upgraded with the latest modifications and guarantee that your filings comply with the most existing standards. If the Internal revenue service requests extra details or performs an audit related to your ERC claim, they can likewise offer continuous assistance.
It is necessary to research and veterinarian any company using ERC filing help to ensure their reliability and knowledge. Search for recognized firms with experience in tax and payroll services, or consider reaching out to trusted accounting firms or tax professionals who provide ERC submitting assistance.
Bear in mind that while these companies can supply important help, it’s always a good concept to have a basic understanding of the ERC requirements and procedure yourself. This will assist you make informed choices and ensure precise filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit presented by the U.S. federal government as part of COVID-19 relief procedures. The objective of the ERC is to encourage organizations to retain and pay their employees throughout the pandemic, even if their operations have actually been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is available to eligible companies, consisting of for-profit organizations, tax-exempt organizations, and certain governmental entities. To qualify, employers must satisfy one of two requirements:.
Business operations were completely or partially suspended due to a government order related to COVID-19.
The business experienced a considerable decrease in gross invoices. As pointed out previously, for 2021, a significant decline is specified as a 20% decrease in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a significant decline is specified as a 20% decline in gross invoices compared to the very same quarter in 2019, or a 20% decline in gross receipts compared to the instantly preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit amount amounts to a portion (approximately 70%) of certified salaries paid to staff members, including particular health insurance costs. The optimum credit per worker is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, services that received a Paycheck Security Program (PPP) loan were not qualified for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 allows services to declare the ERC even if they got a PPP loan. However, the exact same salaries can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has actually been retroactively broadened and improved, allowing qualified employers to claim the credit for certified salaries paid as far back as March 13, 2020. This retroactive arrangement provides an opportunity for services to modify prior-year income tax return and receive refunds.
Declaring the Credit: Employers can declare the ERC by reporting it on their work tax returns, generally Type 941. If the credit exceeds the amount of employment taxes owed, the excess can be refunded to the company.
It is very important to note that the ERC provisions and eligibility criteria have developed with time. The very best course of action is to talk to a tax professional or visit the official internal revenue service site for the most comprehensive and current info regarding the ERC, consisting of any recent legislative changes or updates.
To qualify for the ERC, a company must fulfill among the following requirements:.
Business operations were fully or partially suspended due to a government order related to COVID-19.
Business experienced a considerable decrease in gross receipts. For 2021, a considerable decrease is defined as a 20% decline in gross receipts compared to the 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% decline in gross receipts compared to the instantly preceding quarter.
The ERC is readily available to organizations of all sizes, including tax-exempt organizations, however there are some exceptions. Federal government entities and companies that received a PPP loan might have restrictions on claiming the credit.
The process for declaring the ERC involves finishing the needed forms and consisting of the credit on your employment tax return (typically Kind 941). The exact time it takes to process the credit can differ based upon numerous aspects, including the complexity of your organization and the workload of the IRS. It’s suggested to speak with a tax professional for guidance particular to your situation.
There are several companies that can help with the procedure of declaring the ERC. Some widely known business that use assistance with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the info provided here is based upon basic understanding and might not show the most recent updates or changes to the ERC. It is very important to consult with a tax expert or visit the main internal revenue service site for the most accurate and up-to-date details regarding eligibility, claiming procedures, and readily available support.
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 in fact worked or not. In other words, even if the.
workers worked full time and earned money for full-time work, the employer still gets the credit.
Greater than 100. The credit is if the company had more than 100 employees on average in 2019.
enabled only for earnings paid to workers who did not work during the calendar quarter.
In both cases, “wages” includes not simply cash payments however also a portion of the cost of employer.
provided health care. Employee Retention Credit Extended
Payment.
Companies can be instantly reimbursed for the credit by minimizing the amount of payroll taxes they.