Lets talk first about Employee Retention Credit Extension :
Our team here what do these guys doing everybody in this space is assisting teach individuals about ERC and uh constantly supply a beautiful breakfast and have individuals actually learn about the program we must head to the space 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 numerous millions of dollars actually Kevin numerous millions of dollars so these are duplicate copies of the letters that go to customers validating that the check is on the way I indicate you know if you simply start to 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 imply it’s just I suggest consider how many actual customers 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 IRS heading to the client so that’s how you have the ability to track it you know when you
receive this you understand the check is gone for sure and that’s when they pay so they do not pay anything up until they really receive the cash they don’t pay bottom line Wonder trust anything till this letter is confirmed the check is on the way they deposit it into their checking account and they can genuinely trust Wonder trust that the procedure has actually been finished and the number of you believe you have actually processed since 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 and that’s what you require you need 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 important today the staff member retention credit which most of you have never ever become aware of I certainly had not become aware of it until very recently and discovered a lot about it since this is most likely the most affordable cost of capital for any small business 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 creator and CEO of bottom line Concepts 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 say give me a loan it doesn’t 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 ended up being yes the Ambassador and paid spokesperson for this I like this program it’s disappearing 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 start there so during the Trump Administration when President Trump was enacted they developed the cares Act and the cares act provided businesses 3 opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically everyone it makes a huge distinction right there two of them are loans and one’s a refund exactly so the ERC is a refund that’s.
correct the cash money payroll tax refund okay go on sorry I just have to ensure we got that point I suggest that’s a big distinction a loan versus cash cash I like money cash that’s what we’re speaking 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 stunning tough check in the mail where you get actual money from the internal revenue service all right so let’s discuss how it works because it sounds 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 people on the cap table not for investors it’s for staff members right you needed to have owned a business but it’s based upon you having W-2 employees in America not 10.99. so 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 first six months of 2021 on the W-2 appropriate so there were six quarters the program was open well stroll us through the 6 quarters so you had quarters two three and four of 2020 and you had quarters one two and 3 of 2021. okay so that’s how it’s measured you need to be on the W-2 during that period now let’s talk my favorite part cash just how much can you return per employee 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 wage to a maximum of five thousand dollars per staff member for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the staff member’s income to an optimum of seven thousand per quarter how did that happen um they just changed the rules in.
2021 versus because 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 approximately 5 thousand Max and then what happens 21 000 Max in 2021 oh that’s how you come up with twenty 6 thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty 6 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 need to be reduced from the twenty six thousand dollars so if you took PPP loan one and PPP loan two you would decrease the 26 000 so what we’re seeing typically Kevin is if you took PPP money somewhere around ten thousand dollars a person so let’s state hypothetically you owned a restaurant in New york city City where I’m from and you had a hundred workers and you took PPP money you would still get a million dollar in the mail from the IRS so it’s substantial certainly now the huge concern is why does nobody know about this due to the fact that look when I first found out about this when I initially satisfied Josh you know I have actually got great deals of financial investments in lots of companies I’m a major supporter for entrepreneurship in America and make many lots of investments in business owners of which many suffered through the pandemic when I initially heard about this I called BS I don’t believe it because 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 and that were well deserved and we utilized them wisely to survive throughout the pandemic so when I found out about this I stated nah it can’t hold true however when I dug around I even contacted us to my politician pals Guv Senators they didn’t understand about it I indicate that’s how you understand that’s how misinformation is that there’s no information out there then a lot of individuals told me well you can’t get it because you took the PPP also not real so let’s ask Josh why does nobody learn about the employee retention credit you understand what’s interesting you’re talking about the banks Kevin since 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 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 due to the fact that keep in mind in the original cares act you might not do both programs so if you had actually done PPP you might not do 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 government never made it clear to any person about how to.
do this does your CFO understand how to do this not really he or she’s never done it in the past 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 accounting professional no your accounting professional’s never done this before unless you have an account that went into this organization and bottom line my firm Kevin has stayed in business given that 2009 and we’ve been working with the federal government and the state federal government to recuperate cash for Fortune 500 Fortune 1000 business so a great deal of our big huge corporate customers have actually dealt with bottom line to recover other government programs we’ve done sales tax and use tax unemployment tax work chance tax credits research and development tax credits unclaimed property property tax all of these other federal government programs.
The employee retention tax credit is a broad based refundable tax credit designed 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.
company whose company is totally or partly suspended because of COVID-19 or whose gross invoices.
decrease by more than 50%.
Accessibility.
1. The credit is offered to all employers despite size including tax exempt companies. There are.
only 2 exceptions: (1) state and local governments and their instrumentalities and (2) small.
businesses who take Small Business Loans.
2. To certify, the employer needs to meet one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the employer’s service is totally or partly suspended by federal government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross receipts are listed below 50% of the similar quarter in 2019. Once the.
company’s gross receipts go above 80% of an equivalent quarter in 2019 they no longer certify.
after the end of that quarter.
Calculation of the Credit.
The quantity of the credit is 50% of the qualifying incomes paid up to $10,000 in overall.
It works for salaries paid after March 13th and prior to December 31, 2020.
The meaning of certifying salaries differs by whether an employer had, usually, more or less than.
100 workers in 2019.
Business that focus on ERC filing support generally offer knowledge and assistance to assist services navigate the intricate process of declaring the credit. They can provide various services, including:.
How is the employee retention credit calculated? Employee Retention Credit Extension
Eligibility Evaluation: These business will evaluate your organization’s eligibility for the ERC based on factors such as your industry, earnings, and operations. They can assist identify if you fulfill the requirements for the credit and identify the optimum credit quantity you can claim.
Paperwork and Calculation: ERC filing services will help in collecting the needed documents, such as payroll records and monetary statements, to support your claim. They will likewise assist determine the credit quantity based on eligible salaries and other qualifying expenditures.
Retroactive Claim Evaluation: If you are eligible to declare the ERC for prior quarters, these business can review your previous payroll records and financials to identify possible opportunities for retroactive credits. They can assist you amend prior income tax return to declare these refunds.
Filing Help: Companies focusing on ERC filings will prepare and send the necessary forms and documentation on your behalf. This consists of completing Type 941 or any other required tax return.
Compliance and Updates: ERC regulations and guidance have actually developed in time. These business stay updated with the current modifications and guarantee that your filings comply with the most current standards. If the Internal revenue service requests additional information or performs an audit related to your ERC claim, they can also supply continuous support.
It is very important to research study and veterinarian any business providing ERC filing help to guarantee their reliability and competence. Search for recognized companies with experience in tax and payroll services, or consider connecting to trusted accounting firms or tax specialists who offer ERC filing support.
Keep in mind that while these business can provide important assistance, it’s always a good concept to have a basic understanding of the ERC requirements and procedure yourself. This will assist you make notified choices and make sure accurate filings.
The Worker Retention Credit (ERC) is a refundable tax credit presented by the U.S. government as part of COVID-19 relief procedures. The objective of the ERC is to motivate businesses to retain and pay their employees throughout the pandemic, even if their operations have actually been affected.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is readily available to qualified employers, including for-profit companies, tax-exempt companies, and specific governmental entities. To qualify, employers need to fulfill one of two criteria:.
The business operations were totally or partly suspended due to a government order related to COVID-19.
Business experienced a substantial decline in gross invoices. As pointed out earlier, for 2021, a significant decrease is specified as a 20% decrease in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a significant decline is defined as a 20% decrease in gross receipts compared to the 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 is equal to a percentage (as much as 70%) of certified earnings paid to employees, including certain health insurance expenses. The optimum credit per staff member is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, businesses that got an Income Security Program (PPP) loan were not eligible for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 permits businesses to declare the ERC even if they got a PPP loan. The same wages can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively broadened and enhanced, enabling qualified employers to declare the credit for qualified salaries paid as far back as March 13, 2020. This retroactive arrangement provides an opportunity for organizations to amend prior-year income tax return and get refunds.
Claiming the Credit: Employers can claim the ERC by reporting it on their employment tax returns, normally Kind 941. The excess can be reimbursed to the employer if the credit goes beyond the quantity of employment taxes owed.
It is necessary to note that the ERC provisions and eligibility requirements have actually progressed gradually. The best strategy is to speak with a tax professional or visit the official IRS website for the most detailed and up-to-date details concerning the ERC, consisting of any current legal changes or updates.
To get approved for the ERC, a business must meet among the following criteria:.
Business operations were totally or partially suspended due to a federal government order related to COVID-19.
Business experienced a substantial decrease in gross receipts. For 2021, a substantial decline is specified as a 20% decline in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a substantial decline 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 instantly preceding quarter.
The ERC is offered to businesses of all sizes, including tax-exempt organizations, however there are some exceptions. Federal government entities and businesses that received a PPP loan might have limitations on declaring the credit.
The process for declaring the ERC includes finishing the required forms and including the credit on your work tax return (generally Form 941). The exact time it takes to process the credit can differ based on a number of aspects, including the complexity of your organization and the workload of the IRS. It’s recommended to speak with a tax professional for guidance specific to your situation.
There are a number of companies that can help with the procedure of claiming the ERC. Some popular business that offer help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the info supplied here is based upon general understanding and may not reflect the most current updates or changes to the ERC. It is essential to speak with a tax professional or visit the main IRS website for the most updated and precise details regarding eligibility, declaring treatments, and offered support.
Less than 100. If the employer had 100 or fewer workers usually in 2019, then the credit is based.
on incomes paid to all employees whether they in fact worked or not. In other words, even if the.
staff members worked full time and earned money for full time work, the company still gets the credit.
Greater than 100. If the company had more than 100 workers typically in 2019, then the credit is.
enabled just for salaries paid to employees who did not work during the calendar quarter.
In both cases, “incomes” includes not simply money payments but likewise a portion of the cost of employer.
offered healthcare. Employee Retention Credit Extension
Payment.
Companies can be right away compensated for the credit by minimizing the quantity of payroll taxes they.