Lets talk first about Employee Retention Credit Hurricane Irma :
Our group here what do these men doing everyone in this room is helping teach people about ERC and uh constantly provide a gorgeous breakfast and have people really learn about the program we should head to the space where we are able to display a few of the checks that we are getting for business and I want to see that what is this this is uh numerous millions of dollars actually Kevin numerous countless dollars so these are replicate copies of the letters that go to clients validating that the check is on the method I imply you know if you just begin to look at some of these here I indicate this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I mean it’s just I imply consider 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 IRS heading to the consumer 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 until they actually receive the money they don’t pay bottom line Wonder trust anything until this letter is verified the check is on the way they transfer it into their bank account and they can truly rely on Wonder trust that the procedure has been ended up and the number of you believe you’ve processed given that you began this we’re about 35 000 of these for
about 6 billion dollars wow so clearly they understand what they’re doing and that’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 Wonderful here you’re at my YouTube channel we’re speaking about something truly crucial today the staff member retention credit which most of you have actually never become aware of I definitely hadn’t heard of it till extremely just recently and learned a lot about it since this is most likely the most affordable cost of capital for any small company anywhere
anytime if you have workers in between 5 and five hundred so I’ve got the professional with me this is Josh Fox he’s the founder and CEO of bottom line Ideas 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 contact 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 representative for this I enjoy this program it’s going away very soon you got to discover all about it let’s talk worker retention credit Josh Fox what is an ERC let’s simply start there so throughout the Trump Administration when President Trump was enacted they developed the cares Act and the cares act provided services three opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and almost everybody it makes a big distinction right there two of them are loans and one’s a refund precisely so the ERC is a refund that’s.
correct the cash money payroll tax refund okay go on sorry I simply need to make certain we got that point I mean that’s a big difference a loan versus money money I like money cash that’s what we’re talking about alright 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 difficult check in the mail where you get actual money 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 worker retention credit that individual needed to be a staff member 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 workers right you had to have actually owned an organization however it’s based on you having W-2 staff members in America not 10.99. so as long as you had W-2 workers and you paid federal payroll taxes that’s why you would be eligible so you need to be on payroll in 2020 on the W-2 and you need 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 walk us through the six quarters so you had quarters two three and four of 2020 and you had quarters one two and 3 of 2021. all right so that’s how it’s measured you need to be on the W-2 during that duration now let’s talk my favorite part money just how much can you return per worker that was on a W-2 in those six quarters so the computation in 2020 to be specific Kevin is 50 of the worker’s wage to an optimum of 5 thousand dollars per staff member for the year of 2020 and in 2021 the numbers increased to 70 of the worker’s wage to an optimum of 7 thousand per quarter how did that happen um they just altered the rules in.
2021 versus since the mayhem 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 as much as 5 thousand Max and after that 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 five thousand in twenty twenty that’s twenty 6 thousand dollars per employee that is since that’s a great deal of money it is now there’s a caveat here the PPP money 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 usually Kevin is if you took PPP cash someplace around 10 thousand dollars a person so let’s state hypothetically you owned a restaurant in New York 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 IRS so it’s big certainly now the big concern is why does no one understand about this because appearance when I initially found out about this when I initially met Josh you understand I have actually got lots of investments in great deals of business I’m a significant supporter for entrepreneurship in America and make numerous lots of financial investments in entrepreneurs of which lots of suffered through the pandemic when I first found out about this I called BS I do not think it because I utilize 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 deserved and we utilized them sensibly to survive throughout the pandemic so when I heard about this I said nah it can’t be true but when I dug around I even called to my political leader buddies Guv Senators they didn’t know about it I suggest that’s how you understand that’s how misinformation is that there’s no info out there then a bunch of people informed me well you can’t get it because you took the PPP also not real so let’s ask Josh why does no one know about the staff member retention credit you understand what’s intriguing you’re discussing the banks Kevin because in the PPP loan process the federal government made it very 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 procedure 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 chaos due to the fact that 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 altered 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 ever made it clear to any person about how to.
do this does your CFO know how to do this not actually he or she’s never ever done it before 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 ever done this before unless you have an account that entered into this company and bottom line my company Kevin has stayed in business considering that 2009 and we’ve been dealing with the federal government and the state government to recover cash for Fortune 500 Fortune 1000 business so a lot of our huge huge business clients have worked with bottom line to recover other government programs we have actually done sales tax and use tax joblessness tax work chance tax credits research and development tax credits unclaimed property real estate tax all of these other federal government programs.
The employee retention tax credit is a broad based refundable tax credit created to motivate.
companies to keep employees on their payroll. The credit is 50% of as much as $10,000 in salaries paid by an.
Because of COVID-19 or whose gross receipts, employer whose organization is totally or partly suspended.
decline by more than 50%.
Availability.
1. The credit is offered to all employers no matter size consisting of tax exempt organizations. There are.
just two exceptions: (1) state and local governments and their instrumentalities and (2) small.
businesses who take Small Business Loans.
2. To qualify, the employer needs to fulfill one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the company’s business is completely or partially suspended by government order due to COVID-19.
during the calendar quarter or.
o the employer’s gross receipts are below 50% of the comparable quarter in 2019. As soon as the.
company’s gross invoices go above 80% of a similar quarter in 2019 they no longer certify.
after completion of that quarter.
Estimation of the Credit.
The quantity of the credit is 50% of the certifying wages paid up to $10,000 in overall.
It is effective for incomes paid after March 13th and before December 31, 2020.
The meaning of qualifying earnings differs by whether an employer had, on average, basically than.
100 staff members in 2019.
Business that concentrate on ERC filing help generally offer proficiency and support to help businesses browse the complex process of declaring the credit. They can provide various services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit Hurricane Irma
Eligibility Evaluation: These companies will evaluate your business’s eligibility for the ERC based upon aspects such as your industry, profits, and operations. If you satisfy the requirements for the credit and identify the maximum credit amount you can claim, they can assist identify.
Documents and Calculation: ERC filing services will help in gathering the needed paperwork, such as payroll records and monetary declarations, to support your claim. They will likewise help compute the credit amount based on qualified salaries and other qualifying expenses.
Retroactive Claim Review: If you are eligible to claim the ERC for prior quarters, these business can examine your past payroll records and financials to determine possible opportunities for retroactive credits. They can help you modify previous tax returns to claim these refunds.
Filing Support: Companies focusing on ERC filings will prepare and send the required types and paperwork on your behalf. This consists of completing Form 941 or any other necessary tax return.
Compliance and Updates: ERC guidelines and guidance have actually evolved with time. These companies remain updated with the latest modifications and ensure that your filings adhere to the most present guidelines. If the Internal revenue service requests additional details or performs an audit associated to your ERC claim, they can likewise provide continuous assistance.
It is necessary to research study and vet any business offering ERC filing support to ensure their trustworthiness and know-how. Search for recognized companies with experience in tax and payroll services, or think about reaching out to trusted accounting firms or tax professionals who use ERC submitting support.
Keep in mind that while these business can supply important assistance, it’s always an excellent idea to have a basic understanding of the ERC requirements and process yourself. This will assist you make informed decisions and guarantee 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 measures. The objective of the ERC is to motivate companies to maintain and pay their staff members throughout the pandemic, even if their operations have actually been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is offered to eligible companies, consisting of for-profit organizations, tax-exempt organizations, and specific governmental entities. To certify, companies need to meet one of two criteria:.
Business operations were completely or partly suspended due to a federal government order related to COVID-19.
The business experienced a significant decline in gross receipts. As mentioned previously, for 2021, a significant decline is defined as a 20% decline in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a considerable decrease is defined as a 20% decline in gross receipts 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 percentage (approximately 70%) of qualified earnings paid to staff members, including certain health plan expenditures. 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, services that received a Paycheck Security Program (PPP) loan were not eligible for the ERC. However, legislation passed in late 2020 and extended in 2021 permits businesses to claim the ERC even if they got a PPP loan. The very same salaries can not be utilized to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively broadened and enhanced, permitting qualified employers to claim the credit for certified salaries paid as far back as March 13, 2020. This retroactive provision supplies an opportunity for businesses to modify prior-year tax returns and receive refunds.
Declaring 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 company if the credit surpasses the quantity of employment taxes owed.
It is essential to keep in mind that the ERC arrangements and eligibility criteria have evolved in time. The very best course of action is to talk to a tax expert or visit the official internal revenue service site for the most current and detailed information relating to the ERC, including any recent legal changes or updates.
To get approved for the ERC, a business must fulfill among the following requirements:.
Business operations were totally or partially suspended due to a federal government order related to COVID-19.
Business experienced a considerable decline in gross invoices. For 2021, a substantial decline is specified as a 20% decline in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a substantial decrease is specified as a 20% decline in gross receipts 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 businesses of all sizes, consisting of tax-exempt companies, but there are some exceptions. Federal government entities and companies that got a PPP loan may have limitations on declaring the credit.
The procedure for declaring the ERC involves completing the essential kinds and including the credit on your employment income tax return (typically Kind 941). The exact time it takes to process the credit can vary based on several aspects, consisting of the complexity of your organization and the work of the internal revenue service. It’s advised to consult with a tax expert for assistance specific to your circumstance.
There are a number of companies that can assist with the procedure of claiming the ERC. Some popular companies that use assistance with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the info offered here is based upon basic understanding and may not reflect the most recent updates or modifications to the ERC. It is necessary to consult with a tax professional or go to the main internal revenue service website for the most accurate and current details regarding eligibility, claiming treatments, and readily available help.
Less than 100. The credit is based if the company had 100 or fewer employees on average in 2019.
on incomes paid to all workers whether they actually worked or not. To put it simply, even if the.
workers worked full time and earned money for full time work, the company still gets the credit.
Greater than 100. The credit is if the company had more than 100 staff members on average in 2019.
enabled only for earnings paid to staff members who did not work throughout the calendar quarter.
In both cases, “incomes” includes not just cash payments however likewise a portion of the cost of company.
supplied health care. Employee Retention Credit Hurricane Irma
Payment.
Companies can be instantly reimbursed for the credit by minimizing the quantity of payroll taxes they.