Lets talk first about Employee Retention Credit For Contractors :
Our group here what do these men doing everyone in this room is helping teach people about ERC and uh constantly offer a stunning breakfast and have people actually find out about the program we ought to head to the space where we have the ability to display a few of the checks that we are getting for business and I wish to see that what is this this is uh hundreds of 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 method I mean you know if you simply begin 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 suggest it’s simply I suggest think of the number of real 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 internal revenue service heading to the consumer so that’s how you’re able 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 till they in fact get the money they don’t pay bottom line Wonder trust anything until this letter is validated the check is on the method they transfer it into their bank account and they can really rely on Wonder trust that the procedure has been completed and how many you think you’ve processed given that you began this we’re about 35 000 of these for
about 6 billion dollars wow so clearly they know what they’re doing which’s what you require you need professionals 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 Fantastic here you’re at my YouTube channel we’re discussing something really essential today the employee retention credit which most of you have never become aware of I definitely hadn’t become aware of it until extremely recently and discovered a lot about it because this is most likely the lowest expense of capital for any small company anywhere
anytime if you have staff members in 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 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 simply phone your bank manager and say provide me a loan it does not 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 become yes the Ambassador and paid spokesperson for this I like this program it’s going away very soon you got to learn all about it let’s talk employee retention credit Josh Fox what is an ERC let’s just begin there so during the Trump Administration when President Trump was enacted they created the cares Act and the cares act provided organizations 3 chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically everybody it makes a big distinction right there 2 of them are loans and one’s a refund precisely so the ERC is a refund that’s.
correct the cash cash payroll tax refund all right go on sorry I just need to ensure we got that point I mean that’s a huge difference a loan versus money cash I like cash cash that’s what we’re talking about fine 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 lovely hard check in the mail where you get actual cash from the internal revenue service all right so let’s discuss how it works due to the fact that it seems like to me if it’s a if it’s staff member retention credit that person had to be a worker so I’m going to make the Assumption 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 however it’s based on you having W-2 staff members 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 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 right so there were 6 quarters the program was open well stroll us through the 6 quarters so you had quarters two 3 and 4 of 2020 and you had quarters one 2 and 3 of 2021. fine so that’s how it’s determined you have to be on the W-2 during that period now let’s talk my preferred part money how much can you get back per worker that was on a W-2 in those 6 quarters so the computation in 2020 to be precise 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 worker’s income to an optimum of seven thousand per quarter how did that occur um they just changed the rules in.
2021 versus due to the fact that the chaos 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 5 thousand Max and after that what takes place 21 000 Max in 2021 oh that’s how you come up with twenty six thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty six thousand dollars per worker that is since that’s a lot of money it is now there’s a caution here the PPP money would have to be minimized 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 cash someplace around ten thousand dollars a person so let’s say hypothetically you owned a dining establishment in New York 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 internal revenue service so it’s huge undoubtedly now the big question is why does nobody know about this since appearance when I first heard about this when I initially fulfilled Josh you understand I’ve got lots of financial investments in lots of business I’m a major advocate for entrepreneurship in America and make many numerous investments in entrepreneurs of which lots of suffered through the pandemic when I initially became aware of this I called BS I do not think it because I use 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 survive during the pandemic so when I became aware of this I said nah it can’t hold true but when I dug around I even called to my politician buddies Governor Senators they didn’t learn about it I mean that’s how you understand that’s how false information is that there’s no info out there then a bunch of individuals told me well you can’t get it because you took the PPP also not true so let’s ask Josh why does no one learn about the worker retention credit you understand what’s interesting you’re speaking about the banks Kevin because in the PPP loan process the federal government made it extremely 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 simply process process that’s all um and here there was turmoil because keep in mind in the initial cares act you could not do both programs so if you had actually done PPP you might not do ERC in the initial program and when they changed the law in 2021 the banks were refraining from doing ERC because 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 truly he or she’s never ever done it previously do the banks do it nope the banks do not do it the payroll business yeah a few of them are doing it as a payroll business your accountant no your accounting professional’s never done this before unless you have an account that went into this company and bottom line my firm Kevin has been in business considering that 2009 and we have actually been working with the federal government and the state government to recuperate cash for Fortune 500 Fortune 1000 companies so a lot of our huge huge business clients have actually worked with bottom line to recuperate other federal government programs we have actually done sales tax and utilize tax unemployment tax work chance tax credits research and development tax credits unclaimed property real estate tax all of these other federal government programs.
The worker retention tax credit is a broad based refundable tax credit designed to encourage.
employers to keep workers on their payroll. The credit is 50% of as much as $10,000 in wages paid by an.
Because of COVID-19 or whose gross receipts, employer whose organization is fully or partially suspended.
decline by more than 50%.
Accessibility.
1. The credit is readily available to all companies despite size consisting of tax exempt organizations. There are.
just two exceptions: (1) state and city governments and their instrumentalities and (2) small.
companies who take Small company Loans.
2. To qualify, the employer has to meet one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the company’s organization is fully or partially suspended by government order due to COVID-19.
throughout the calendar quarter or.
o the employer’s gross receipts are below 50% of the comparable quarter in 2019. Once the.
company’s gross receipts go above 80% of a similar quarter in 2019 they no longer certify.
after completion of that quarter.
Computation of the Credit.
The quantity of the credit is 50% of the qualifying wages paid up to $10,000 in overall.
It works for earnings paid after March 13th and prior to December 31, 2020.
The definition of certifying incomes varies by whether a company had, on average, basically than.
100 workers in 2019.
Companies that concentrate on ERC filing assistance generally offer knowledge and support to help businesses navigate the complex process of claiming the credit. They can provide numerous services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit For Contractors
Eligibility Evaluation: These business will examine your service’s eligibility for the ERC based upon aspects such as your market, revenue, and operations. If you fulfill the requirements for the credit and determine the maximum credit amount you can declare, they can help identify.
Paperwork and Calculation: ERC filing services will assist in collecting the essential documents, such as payroll records and financial statements, 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 eligible to claim the ERC for prior quarters, these companies can examine your past payroll records and financials to recognize possible chances for retroactive credits. They can assist you change prior tax returns to declare these refunds.
Filing Assistance: Companies concentrating on ERC filings will prepare and submit the needed types and documentation on your behalf. This includes finishing Form 941 or any other necessary tax forms.
Compliance and Updates: ERC guidelines and assistance have progressed over time. These companies stay updated with the current modifications and make sure that your filings comply with the most current guidelines. If the Internal revenue service demands extra details or carries out an audit associated to your ERC claim, they can likewise supply continuous support.
It is very important to research study and vet any business using ERC filing assistance to ensure their credibility and knowledge. Look for established companies with experience in tax and payroll services, or think about connecting to relied on accounting firms or tax experts who use ERC submitting support.
Keep in mind that while these companies can supply important help, it’s constantly a great concept to have a fundamental understanding of the ERC requirements and process yourself. This will help you make notified decisions and make sure accurate 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 steps. The objective of the ERC is to encourage businesses to retain and pay their employees during the pandemic, even if their operations have actually been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is readily available to eligible companies, consisting of for-profit services, tax-exempt organizations, and specific governmental entities. To qualify, employers need to fulfill one of two criteria:.
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 invoices. As discussed previously, for 2021, a substantial decrease is specified as a 20% decrease in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a considerable decrease is defined as a 20% decrease in gross invoices compared to the very same quarter in 2019, or a 20% decrease in gross invoices compared to the immediately 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 (up to 70%) of qualified salaries paid to workers, consisting of specific health insurance expenses. The maximum credit per employee is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, companies that received a Paycheck Security Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 permits businesses to claim the ERC even if they received a PPP loan. Nevertheless, the exact same wages can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively broadened and boosted, enabling eligible companies to claim the credit for certified earnings paid as far back as March 13, 2020. This retroactive provision provides a chance for businesses to modify prior-year income tax return and receive refunds.
Declaring the Credit: Companies can declare the ERC by reporting it on their work tax returns, normally Form 941. The excess can be refunded to the employer if the credit exceeds the amount of employment taxes owed.
It is very important to keep in mind that the ERC arrangements and eligibility criteria have developed over time. The very best strategy is to seek advice from a tax professional or visit the official IRS site for the most in-depth and current information relating to the ERC, consisting of any current legislative modifications or updates.
To qualify for the ERC, a service needs to meet among the following requirements:.
The business operations were fully or partially suspended due to a federal government order related to COVID-19.
The business experienced a considerable decline in gross invoices. For 2021, a significant decrease is defined as a 20% decrease in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a significant decline is defined as a 20% decline in gross invoices compared to the very same quarter in 2019, or a 20% decline in gross invoices compared to the right away preceding quarter.
The ERC is available to businesses of all sizes, consisting of tax-exempt companies, but there are some exceptions. For instance, federal government entities and organizations that got a PPP loan may have limitations on declaring the credit.
The process for claiming the ERC involves completing the needed forms and consisting of the credit on your work income tax return (typically Type 941). The exact time it requires to process the credit can differ based upon several elements, consisting of the intricacy of your service and the work of the internal revenue service. It’s advised to seek advice from a tax expert for assistance specific to your situation.
There are several business that can assist with the process of claiming the ERC. Some widely known companies that provide assistance with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the info supplied here is based on basic understanding and might not show the most current updates or changes to the ERC. It is very important to seek advice from a tax expert or go to the main internal revenue service website for the most accurate and current info regarding eligibility, claiming treatments, and offered help.
Less than 100. If the company had 100 or less staff members usually in 2019, then the credit is based.
on earnings paid to all staff members whether they actually worked or not. To put it simply, even if the.
staff members worked full time and earned money for full-time work, the company still gets the credit.
Greater than 100. The credit is if the employer had more than 100 workers on average in 2019.
permitted only for salaries paid to employees who did not work throughout the calendar quarter.
In both cases, “incomes” consists of not simply money payments however likewise a portion of the expense of company.
supplied health care. Employee Retention Credit For Contractors
Payment.
Companies can be immediately reimbursed for the credit by minimizing the amount of payroll taxes they.