Lets talk first about Employee Retention Credit Irs Guidance :
Our group here what do these men doing everybody in this room is helping teach people about ERC and uh constantly provide a lovely breakfast and have individuals really learn more about the program we should head to the room where we have the ability to display some of the checks that we are getting for companies and I want to see that what is this this is uh numerous countless dollars actually Kevin numerous countless dollars so these are replicate copies of the letters that go to customers verifying that the check is on the method I indicate you know if you simply 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 suggest it’s just I indicate consider how many actual clients 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 IRS heading to the client so that’s how you have the ability to track it you know when you
receive this you know the check is chosen sure and that’s when they pay so they do not pay anything until they actually get the cash they don’t pay bottom line Wonder trust anything till this letter is validated the check is on the method they deposit it into their bank account and they can really rely on Wonder trust that the process has actually been finished and how many you think you have actually processed since you began this we’re about 35 000 of these for
about 6 billion dollars wow so clearly they know 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 among these that’s what matters all right Mr Fantastic here you’re at my YouTube channel we’re talking about something truly essential today the worker retention credit which the majority of you have actually never heard of I definitely had not become aware of it up until extremely just recently and learned a lot about it since this is probably the lowest cost of capital for any small company anywhere
anytime if you have staff members in between 5 and five hundred so I’ve got the specialist 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 call up your bank manager and say give me a loan it doesn’t work there’s not a loan it’s an application and Josh is going to inform all of us 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 soon you got to find out all about it let’s talk employee retention credit Josh Fox what is an ERC let’s just start there so throughout the Trump Administration when President Trump was enacted they created the cares Act and the cares act offered companies 3 chances 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 2 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 huge distinction a loan versus money cash I like money money that’s what we’re speaking about 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 original cares Act is the ERC and yes Kevin it is a lovely tough check in the mail where you get real money from the IRS all right so let’s speak about how it works because it seems like to me if it’s a if it’s employee retention credit that person had to be a staff member so I’m going to make the Assumption this money is not for the owner not for people on the cap table not for shareholders it’s for workers right you had to have actually owned a company however it’s based upon you having W-2 employees 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 qualified so you need to be on payroll in 2020 on the W-2 and you need to be on payroll for the first 6 months of 2021 on the W-2 appropriate 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 two and three of 2021. alright 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 cash how much can you return per worker that was on a W-2 in those 6 quarters so the estimation in 2020 to be precise Kevin is 50 of the staff member’s salary to a maximum of five thousand dollars per worker for the year of 2020 and in 2021 the numbers escalated to 70 of the staff member’s salary to a maximum of 7 thousand per quarter how did that happen um they simply 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 up to five thousand Max and after that what occurs 21 000 Max in 2021 oh that’s how you come up with twenty six thousand twenty one thousand to twenty twenty one plus five thousand in twenty twenty that’s twenty six thousand dollars per staff member that is since that’s a lot of money it is now there’s a caveat here the PPP money would need to be reduced from the twenty six thousand dollars so if you took PPP loan one and PPP loan two you would reduce the 26 000 so what we’re seeing usually Kevin is if you took PPP cash someplace around 10 thousand dollars an individual so let’s say hypothetically you owned a restaurant 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 IRS so it’s big certainly now the big concern is why does no one know about this because appearance when I initially heard about this when I first fulfilled Josh you know I’ve got great deals of investments in lots of companies I’m a major advocate for entrepreneurship in America and make numerous numerous financial investments in business owners of which numerous suffered through the pandemic when I first became aware of this I called BS I don’t think it due to the fact that I use the PPP we went through the cash center Banks to get it it was extremely 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 during 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 political leader good friends Governor Senators they didn’t know about it I indicate that’s how you understand that’s how false information is that there’s no info out there then a lot of individuals told me well you can’t get it since you took the PPP likewise not real so let’s ask Josh why does nobody know about the worker retention credit you understand what’s interesting you’re talking about the banks Kevin due to the fact that 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 nation and they would process procedure in Canada a pre-pp loan there’s no loans in Canada by the way it’s just procedure procedure that’s all um and here there was turmoil due to the fact that keep in mind in the initial cares act you could refrain from doing both programs so if you had actually done PPP you could refrain from doing ERC in the original program and when they changed the law in 2021 the banks were not doing ERC due to the fact that it’s not alone so you’re getting a tax refund so the federal government never ever made it clear to anyone about how to.
do this does your CFO know how to do this not truly she or he’s never ever done it previously do the banks do it nope the banks don’t do it the payroll business yeah some 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 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 huge huge business clients have worked with bottom line to recuperate other government programs we have actually done sales tax and use tax unemployment tax work opportunity tax credits research and development tax credits unclaimed home property tax all of these other federal government programs.
The worker retention tax credit is a broad based refundable tax credit created to encourage.
companies to keep staff members on their payroll. The credit is 50% of approximately $10,000 in wages paid by an.
employer whose organization is totally or partially suspended because of COVID-19 or whose gross invoices.
decline by more than 50%.
1. The credit is offered to all employers no matter size consisting of tax exempt companies. There are.
only 2 exceptions: (1) state and city governments and their instrumentalities and (2) little.
companies who take Small Business Loans.
2. To qualify, the employer needs to satisfy one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the employer’s organization is totally or partly suspended by federal 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. When the.
employer’s gross invoices go above 80% of an equivalent quarter in 2019 they no longer qualify.
after completion of that quarter.
Estimation of the Credit.
The quantity of the credit is 50% of the qualifying incomes paid up to $10,000 in overall.
It is effective for incomes paid after March 13th and prior to December 31, 2020.
The definition of qualifying earnings differs by whether an employer had, on average, more or less than.
100 staff members in 2019.
Companies that specialize in ERC filing support typically offer proficiency and assistance to help businesses browse the complex procedure of declaring the credit. They can use different services, including:.
How is the employee retention credit calculated? Employee Retention Credit Irs Guidance
Eligibility Assessment: These companies will examine your company’s eligibility for the ERC based upon aspects such as your market, earnings, and operations. They can assist determine if you fulfill the requirements for the credit and determine the optimum credit amount you can claim.
Documents and Estimation: ERC filing services will help in gathering the needed paperwork, such as payroll records and monetary statements, to support your claim. They will also assist calculate the credit quantity based upon qualified incomes and other qualifying costs.
Retroactive Claim Review: If you are qualified to claim the ERC for prior quarters, these companies can review your previous payroll records and financials to recognize possible opportunities for retroactive credits. They can help you change prior tax returns to declare these refunds.
Filing Support: Business focusing on ERC filings will prepare and send the necessary kinds and paperwork on your behalf. This includes completing Kind 941 or any other necessary tax return.
Compliance and Updates: ERC policies and guidance have actually developed with time. These companies stay updated with the current changes and make sure that your filings comply with the most existing standards. If the IRS requests extra info or conducts an audit associated to your ERC claim, they can also provide ongoing assistance.
It is very important to research study and vet any business providing ERC filing assistance to ensure their reliability and competence. Look for established companies with experience in tax and payroll services, or consider connecting to trusted accounting firms or tax specialists who use ERC submitting support.
Remember that while these business can provide valuable assistance, it’s always an excellent idea to have a standard understanding of the ERC requirements and process yourself. This will assist you make notified decisions and guarantee 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 measures. The goal of the ERC is to encourage businesses to keep and pay their staff members during the pandemic, even if their operations have been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is readily available to eligible employers, including for-profit companies, tax-exempt organizations, and specific governmental entities. To qualify, employers need to meet one of two criteria:.
The business operations were completely or partly suspended due to a government order related to COVID-19.
The business experienced a significant decrease in gross receipts. As mentioned previously, for 2021, a substantial decline is defined as a 20% decline in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a significant decline is defined as a 20% decrease in gross receipts compared to the very same quarter in 2019, or a 20% decline in gross invoices compared to the right away preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the employer’s share of Social Security taxes. The credit amount is equal to a percentage (up to 70%) of qualified salaries paid to staff members, including certain health plan 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, organizations that received a Paycheck Protection Program (PPP) loan were not qualified 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 exact same incomes can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively expanded and enhanced, allowing qualified companies to declare the credit for qualified earnings paid as far back as March 13, 2020. This retroactive arrangement supplies an opportunity for companies to change prior-year tax returns and get refunds.
Declaring the Credit: Employers can claim the ERC by reporting it on their work tax returns, usually Form 941. The excess can be refunded to the company if the credit exceeds the amount of work taxes owed.
It is essential to note that the ERC arrangements and eligibility requirements have developed gradually. The best course of action is to speak with a tax professional or go to the main internal revenue service site for the most detailed and current info regarding the ERC, consisting of any current legislative modifications or updates.
To get approved for the ERC, a service needs to meet one of the following criteria:.
Business operations were fully or partially suspended due to a federal government order related to COVID-19.
The business experienced a considerable decrease in gross receipts. For 2021, a significant decline is defined as a 20% decrease in gross invoices 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 same quarter in 2019, or a 20% decrease in gross invoices compared to the instantly preceding quarter.
The ERC is readily available to organizations of all sizes, including tax-exempt companies, but there are some exceptions. Federal government entities and services that received a PPP loan might have constraints on declaring the credit.
The procedure for declaring the ERC includes completing the required kinds and including the credit on your work tax return (generally Kind 941). The exact time it takes to process the credit can vary based upon several factors, including the intricacy of your organization and the work of the IRS. It’s suggested to consult with a tax expert for assistance specific to your circumstance.
There are numerous business that can help with the procedure of declaring the ERC. These include accounting firms, tax advisory services, and payroll service providers. Some well-known companies that provide support with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s advisable to research and contact these companies directly to ask about their services and costs.
Please keep in mind that the information offered here is based on general understanding and may not show the most recent updates or changes to the ERC. It is very important to talk to a tax professional or visit the official IRS site for the most accurate and updated details concerning eligibility, declaring procedures, and readily available assistance.
Less than 100. If the employer had 100 or fewer staff members usually in 2019, then the credit is based.
on incomes paid to all staff members whether they really worked or not. Simply put, even if the.
staff members worked full time and got paid 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 wages paid to staff members who did not work throughout the calendar quarter.
In both cases, “incomes” consists of not simply money payments but likewise a part of the expense of company.
offered health care. Employee Retention Credit Irs Guidance
Companies can be right away repaid for the credit by reducing the amount of payroll taxes they.