Lets talk first about Employee Retention Credit Nonprofit Gross Receipts :
Our team here what do these people doing everybody in this space is assisting teach individuals about ERC and uh constantly supply a beautiful breakfast and have people really discover the program we must head to the space where we are able to display a few of the checks that we are getting for business and I ‘d like to see that what is this this is uh numerous millions of dollars actually Kevin hundreds of countless dollars so these are replicate copies of the letters that go to clients confirming that the check is on the method I indicate you understand if you simply begin to take a 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 indicate it’s just I indicate think about how many actual customers that went through the program yeah this is the very end this is the celebration at the end when the check is confirmed the numbers are confirmed and the check is on the mail in the mail from the internal revenue service heading to the customer so that’s how you have the ability to track it you know when you
receive this you know the check is gone for sure and that’s when they pay so they don’t pay anything till they actually get the money they do not pay bottom line Wonder trust anything till this letter is validated the check is on the way they transfer it into their savings account and they can truly trust Wonder trust that the process has been ended up and how many you think you have actually processed given that you started this we have to do with 35 000 of these for
about 6 billion dollars wow so plainly they know what they’re doing and that’s what you need you require 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 really essential today the staff member retention credit which the majority of you have actually never heard of I definitely had not become aware of it till extremely just recently and found out a lot about it because this is probably the most affordable expense of capital for any small business anywhere
anytime if you have employees between five and five hundred so I’ve got the expert 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 difficult this isn’t like PPP we just call your bank manager and say 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 become yes the Ambassador and paid spokesperson for this I love 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 throughout the Trump Administration when President Trump was enacted they came up with the cares Act and the cares act provided businesses three opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly everybody it makes a big distinction right there two of them are loans and one’s a refund exactly so the ERC is a refund that’s.
correct the money cash payroll tax refund fine go on sorry I just have to ensure we got that point I mean that’s a huge difference a loan versus money cash I like cash money 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 stunning tough check in the mail where you get real cash from the IRS all right so let’s discuss how it works since it seems 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 staff members right you had to have actually owned an organization but it’s based on you having W-2 employees in America not 10.99. As long as you had W-2 workers 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 6 months of 2021 on the W-2 correct so there were six 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 2 and three of 2021. alright so that’s how it’s determined you have to be on the W-2 throughout that duration now let’s talk my favorite part cash just how much can you return per staff member that was on a W-2 in those six quarters so the computation in 2020 to be exact Kevin is 50 of the employee’s wage to a maximum of five thousand dollars per employee for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the worker’s income to a maximum 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 wished 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 after that what takes place 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 staff member that is since that’s a lot of cash it is now there’s a caution here the PPP money would need to be reduced from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan two you would lower the 26 000 so what we’re seeing typically Kevin is if you took PPP cash someplace around 10 thousand dollars an individual so let’s state hypothetically you owned a dining establishment in New York City where I’m from and you had a hundred employees and you took PPP cash you would still get a million dollar in the mail from the internal revenue service so it’s substantial obviously now the huge question is why does nobody learn about this because appearance when I initially found out about this when I first satisfied Josh you understand I’ve got lots of investments in great deals of companies I’m a major supporter for entrepreneurship in America and make many many investments in entrepreneurs of which numerous suffered through the pandemic when I first found out about this I called BS I don’t believe it due to the fact that I utilize 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 should have and we used them wisely to stay alive throughout the pandemic so when I heard about this I said nah it can’t hold true however when I dug around I even contacted us to my politician friends Guv Senators they didn’t learn about it I indicate that’s how you know that’s how misinformation is that there’s no information 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 nobody understand about the staff member retention credit you know what’s fascinating you’re discussing the banks Kevin because in the PPP loan procedure the federal government made it extremely clear that if you wanted 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 mayhem due to the fact that keep in mind in the original cares act you could not do both programs so if you had actually done PPP you might refrain from doing ERC in the initial 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 anyone 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 companies yeah a few of them are doing it as a payroll business your accounting professional no your accounting professional’s never ever done this before unless you have an account that entered into this business and bottom line my company Kevin has stayed in business given that 2009 and we have actually been dealing with the federal government and the state government to recuperate cash for Fortune 500 Fortune 1000 business so a great deal of our huge huge corporate clients have worked with bottom line to recover other federal government programs we’ve done sales tax and utilize tax joblessness tax work chance tax credits research and development tax credits unclaimed property property tax all of these other government programs.
The worker retention tax credit is a broad based refundable tax credit created to encourage.
companies to keep employees on their payroll. The credit is 50% of as much as $10,000 in wages paid by an.
employer whose service is completely or partly suspended because of COVID-19 or whose gross receipts.
decrease by more than 50%.
1. The credit is offered to all employers regardless of size consisting of tax exempt companies. There are.
only 2 exceptions: (1) state and local governments and their instrumentalities and (2) small.
services who take Small company Loans.
2. To certify, the company needs to fulfill one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the employer’s business is totally or partially suspended by government order due to COVID-19.
during the calendar quarter or.
o the employer’s gross invoices are listed below 50% of the similar quarter in 2019. When the.
employer’s gross invoices exceed 80% of a comparable 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 total.
It is effective for wages paid after March 13th and prior to December 31, 2020.
The meaning of certifying salaries differs by whether a company had, typically, more or less than.
100 workers in 2019.
Companies that concentrate on ERC filing assistance normally supply competence and support to help organizations navigate the intricate procedure of claiming the credit. They can offer different services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit Nonprofit Gross Receipts
Eligibility Evaluation: These companies will examine your business’s eligibility for the ERC based upon elements such as your market, revenue, and operations. They can assist determine if you meet the requirements for the credit and identify the maximum credit amount you can declare.
Documentation and Estimation: ERC filing services will help in collecting the essential paperwork, such as payroll records and financial declarations, to support your claim. They will also assist calculate the credit amount based on qualified wages and other certifying expenditures.
Retroactive Claim Review: If you are eligible to claim the ERC for prior quarters, these business can examine your previous payroll records and financials to recognize prospective opportunities for retroactive credits. They can assist you modify previous tax returns to claim these refunds.
Filing Help: Companies specializing in ERC filings will prepare and send the required types and documentation in your place. This includes completing Kind 941 or any other required tax return.
Compliance and Updates: ERC policies and guidance have developed with time. These business stay updated with the current changes and guarantee that your filings comply with the most current standards. They can also supply continuous support if the internal revenue service requests extra info or carries out an audit related to your ERC claim.
It is very important to research and veterinarian any company providing ERC filing assistance to ensure their credibility and competence. Try to find established firms with experience in tax and payroll services, or think about connecting to trusted accounting companies or tax specialists who use ERC filing support.
Remember that while these companies can offer valuable help, it’s constantly an excellent concept to have a standard understanding of the ERC requirements and process yourself. This will assist you make notified decisions and ensure precise filings.
The Employee Retention Credit (ERC) is a refundable tax credit introduced by the U.S. federal government as part of COVID-19 relief procedures. The objective of the ERC is to motivate companies to retain and pay their employees throughout the pandemic, even if their operations have actually been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is readily available to eligible employers, including for-profit organizations, tax-exempt organizations, and particular governmental entities. To certify, employers need to meet one of two criteria:.
The business operations were fully or partly suspended due to a federal government order related to COVID-19.
The business experienced a considerable decline in gross receipts. As pointed out previously, for 2021, a considerable decrease is defined as a 20% decline in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a substantial decline is specified as a 20% decline in gross invoices compared to the very same quarter in 2019, or a 20% decrease in gross receipts 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 amounts to a percentage (up to 70%) of qualified wages paid to employees, including specific health plan costs. 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: At first, services that got a Paycheck Security Program (PPP) loan were not qualified for the ERC. However, legislation passed in late 2020 and extended in 2021 allows services to declare the ERC even if they got a PPP loan. Nevertheless, the very same incomes can not be utilized to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively expanded and enhanced, enabling eligible companies to claim the credit for qualified incomes paid as far back as March 13, 2020. This retroactive arrangement provides an opportunity for services to amend prior-year tax returns and get refunds.
Declaring the Credit: Employers can claim the ERC by reporting it on their work income tax return, normally Kind 941. The excess can be refunded to the company if the credit goes beyond the amount of employment taxes owed.
It is essential to note that the ERC arrangements and eligibility criteria have actually developed over time. The best course of action is to speak with a tax expert or check out the official internal revenue service website for the most in-depth and updated info regarding the ERC, consisting of any recent legislative changes or updates.
To receive the ERC, an organization must meet one of the following requirements:.
The business operations were totally or partly suspended due to a federal government order related to COVID-19.
Business experienced a significant decrease in gross receipts. For 2021, a significant decrease is defined as a 20% decline 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 immediately preceding quarter.
The ERC is readily available to companies of all sizes, consisting of tax-exempt companies, however there are some exceptions. For example, government entities and organizations that received a PPP loan may have restrictions on declaring the credit.
The procedure for declaring the ERC includes finishing the essential types and consisting of the credit on your employment tax return (normally Kind 941). The exact time it takes to process the credit can differ based on a number of factors, consisting of the intricacy of your organization and the workload of the IRS. It’s suggested to speak with a tax professional for assistance specific to your situation.
There are numerous business that can help with the process of claiming the ERC. Some widely known business that provide support with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the info provided here is based on basic understanding and may not show the most current updates or changes to the ERC. It is very important to seek advice from a tax expert or check out the official internal revenue service website for the most precise and up-to-date info concerning eligibility, declaring procedures, and offered help.
Less than 100. The credit is based if the employer had 100 or less staff members on average in 2019.
on salaries paid to all employees whether they really 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 employer 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, “earnings” includes not simply money payments but also a part of the cost of employer.
supplied healthcare. Employee Retention Credit Nonprofit Gross Receipts
Companies can be right away reimbursed for the credit by lowering the amount of payroll taxes they.