Lets talk first about Employee Retention Credit One Pager :
Our team here what do these people doing everybody in this space is assisting teach individuals about ERC and uh always supply a stunning breakfast and have people truly learn more about the program we must head to the room where we are able to show some of the checks that we are getting for companies and I want to see that what is this this is uh numerous millions of dollars actually Kevin hundreds of countless dollars so these are duplicate copies of the letters that go to clients verifying that the check is on the method I imply you know if you just 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 suggest it’s just I suggest think about the number of 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 verified and the check is on the mail in the mail from the internal revenue service heading to the client so that’s how you have the ability to track it you understand when you
get this you know the check is opted for sure and that’s when they pay so they do not pay anything till they really get the cash they don’t 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 really trust Wonder trust that the process has actually been completed and the number of you believe you have actually processed given that you began this we have to do with 35 000 of these for
about six billion dollars wow so plainly they know what they’re doing and that’s what you require you need specialists 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 Terrific here you’re at my YouTube channel we’re discussing something really important today the worker retention credit which the majority of you have never become aware of I certainly had not heard of it until really recently and learned a lot about it due to the fact that this is probably the most affordable cost of capital for any small company anywhere
anytime if you have employees in between five and five hundred so I’ve got the specialist with me this is Josh Fox he’s the founder and CEO of bottom line Principles 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 up your bank manager and state provide me a loan it does not 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 have actually become yes the Ambassador and paid representative for this I like this program it’s going away soon you got to find out all about it let’s talk worker retention credit Josh Fox what is an ERC let’s simply begin there so throughout the Trump Administration when President Trump was enacted they created the cares Act and the cares act used companies 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 huge difference right there 2 of them are loans and one’s a refund precisely so the ERC is a refund that’s.
fix the money money payroll tax refund okay go on sorry I simply have to make sure we got that point I imply that’s a huge distinction a loan versus cash money I like money cash that’s what we’re discussing 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 initial cares Act is the ERC and yes Kevin it is a lovely difficult check in the mail where you get actual cash from the internal revenue service all right so let’s talk about how it works due to the fact that it seems like to me if it’s a if it’s worker retention credit that person had 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 employees right you needed to have actually owned a business but it’s based on you having W-2 staff members 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 qualified 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 right so there were six quarters the program was open well stroll us through the six quarters so you had quarters 2 three and four of 2020 and you had quarters one two and three of 2021. okay so that’s how it’s determined you have to be on the W-2 throughout that duration now let’s talk my preferred part money how much can you get back per employee that was on a W-2 in those six quarters so the estimation in 2020 to be specific Kevin is 50 of the staff member’s income to an optimum of five thousand dollars per staff member for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the worker’s wage to an optimum of 7 thousand per quarter how did that take place um they simply altered 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 up to five thousand Max and after that what occurs 21 000 Max in 2021 oh that’s how you develop twenty 6 thousand twenty one thousand to twenty twenty one plus 5 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 decreased from the twenty six thousand dollars so if you took PPP loan one and PPP loan 2 you would decrease the 26 000 so what we’re seeing usually Kevin is if you took PPP money someplace around 10 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 IRS so it’s huge obviously now the big 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’ve got lots of investments in great deals of companies I’m a major supporter for entrepreneurship in America and make numerous many financial investments in business owners of which numerous suffered through the pandemic when I initially became aware of this I called BS I do not believe it because I utilize the PPP we went through the cash 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 carefully to stay alive during the pandemic so when I found out about this I said nah it can’t hold true but when I dug around I even called to my politician good friends Guv Senators they didn’t know about it I imply that’s how you know that’s how false information is that there’s no details out there then a bunch of people told me well you can’t get it since you took the PPP likewise not true so let’s ask Josh why does no one know about the staff member retention credit you understand what’s intriguing you’re speaking about the banks Kevin due to the fact that in the PPP loan procedure 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 procedure in Canada a pre-pp loan there’s no loans in Canada by the way it’s just process procedure that’s all um and here there was chaos because remember in the original cares act you might refrain from doing both programs so if you had actually done PPP you could 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 federal government never made it clear to anyone about how to.
do this does your CFO understand how to do this not actually he or she’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 accounting professional no your accounting professional’s never ever done this prior to unless you have an account that went into this business and bottom line my firm Kevin has actually stayed in business since 2009 and we have actually been dealing with the federal government and the state federal government to recover money for Fortune 500 Fortune 1000 companies so a lot of our huge big business customers have worked with bottom line to recuperate other federal government programs we’ve done sales tax and utilize tax joblessness tax work opportunity tax credits research and development tax credits unclaimed property property tax all of these other federal government programs.
The worker retention tax credit is a broad based refundable tax credit created to motivate.
companies to keep workers on their payroll. The credit is 50% of up to $10,000 in earnings paid by an.
company whose company is fully or partially suspended because of COVID-19 or whose gross receipts.
decline by more than 50%.
1. The credit is available to all companies no matter size including tax exempt organizations. There are.
only two exceptions: (1) state and local governments and their instrumentalities and (2) little.
services who take Small Business Loans.
2. To certify, the company needs to meet one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the company’s service is fully or partly suspended by federal government order due to COVID-19.
during the calendar quarter or.
o the employer’s gross receipts are listed below 50% of the comparable quarter in 2019. When the.
company’s gross invoices exceed 80% of a similar 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 certifying wages paid up to $10,000 in overall.
It is effective for salaries paid after March 13th and prior to December 31, 2020.
The meaning of qualifying earnings differs by whether an employer had, typically, basically than.
100 employees in 2019.
Companies that concentrate on ERC filing help generally provide expertise and support to assist companies navigate the intricate procedure of declaring the credit. They can use different services, including:.
How is the employee retention credit calculated? Employee Retention Credit One Pager
Eligibility Assessment: These companies will evaluate your business’s eligibility for the ERC based on aspects such as your industry, profits, and operations. If you satisfy the requirements for the credit and recognize the maximum credit amount you can claim, they can assist determine.
Documents and Estimation: ERC filing services will help in collecting the necessary paperwork, such as payroll records and monetary statements, to support your claim. They will also assist calculate the credit amount based upon qualified salaries and other qualifying costs.
Retroactive Claim Review: If you are qualified to claim the ERC for previous quarters, these companies can review your previous payroll records and financials to determine potential chances for retroactive credits. They can help you change previous tax returns to claim these refunds.
Filing Support: Business focusing on ERC filings will prepare and submit the required forms and documents in your place. This includes finishing Form 941 or any other necessary tax forms.
Compliance and Updates: ERC regulations and assistance have actually progressed over time. These companies stay upgraded with the most recent modifications and make sure that your filings adhere to the most present guidelines. If the Internal revenue service requests extra details or performs an audit associated to your ERC claim, they can likewise provide continuous support.
It is essential to research and vet any company using ERC filing help to guarantee their reliability and expertise. Search for established firms with experience in tax and payroll services, or think about reaching out to trusted accounting companies or tax specialists who use ERC submitting assistance.
Remember that while these business can supply important support, it’s always a good idea to have a fundamental understanding of the ERC requirements and process yourself. This will help you make notified choices and make sure accurate filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief procedures. The objective of the ERC is to motivate organizations 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 qualified employers, consisting of for-profit organizations, tax-exempt organizations, and particular governmental entities. To certify, companies need to meet one of two criteria:.
Business operations were fully or partially suspended due to a federal government order related to COVID-19.
Business experienced a considerable decline in gross invoices. As mentioned earlier, for 2021, a substantial decline is defined as a 20% decline in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a substantial decrease is specified as a 20% decrease in gross receipts compared to the 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 company’s share of Social Security taxes. The credit quantity amounts to a portion (approximately 70%) of qualified salaries paid to staff members, consisting of specific health insurance costs. The maximum credit per worker 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 Protection Program (PPP) loan were not eligible for the ERC. However, legislation passed in late 2020 and extended in 2021 allows services to claim the ERC even if they got a PPP loan. However, the 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 boosted, enabling eligible employers to claim the credit for qualified wages paid as far back as March 13, 2020. This retroactive provision provides a chance for companies to change prior-year income tax return and receive refunds.
Declaring the Credit: Companies can declare the ERC by reporting it on their work income tax return, normally Form 941. If the credit exceeds the amount of employment taxes owed, the excess can be refunded to the company.
It is essential to note that the ERC arrangements and eligibility criteria have progressed over time. The very best strategy is to talk to a tax professional or check out the official internal revenue service site for the most current and detailed information regarding the ERC, consisting of any recent legal modifications or updates.
To receive the ERC, a company should fulfill among the following requirements:.
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 invoices. For 2021, a substantial decrease is specified as a 20% decline in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a significant decline 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 right away preceding quarter.
The ERC is available to businesses of all sizes, including tax-exempt organizations, but there are some exceptions. For example, federal government entities and businesses that received a PPP loan may have restrictions on declaring the credit.
The procedure for claiming the ERC involves completing the necessary kinds and including the credit on your employment income tax return (typically Type 941). The exact time it takes to process the credit can vary based on a number of elements, including the intricacy of your service and the work of the internal revenue service. It’s suggested to seek advice from a tax professional for assistance particular to your situation.
There are numerous business that can help with the procedure of claiming the ERC. Some widely known companies that provide support with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the information supplied here is based on basic understanding and may not show the most recent updates or modifications to the ERC. It is very important to speak with a tax expert or check out the official internal revenue service site for the most updated and precise info regarding eligibility, claiming treatments, and readily available help.
Less than 100. The credit is based if the employer had 100 or fewer employees on average in 2019.
on earnings paid to all employees whether they really worked or not. To put it simply, even if the.
employees worked full-time and earned money for full time work, the employer still gets the credit.
Greater than 100. If the company had more than 100 staff members on average in 2019, then the credit is.
allowed only for salaries paid to employees who did not work during the calendar quarter.
In both cases, “incomes” consists of not simply money payments but likewise a portion of the cost of employer.
provided healthcare. Employee Retention Credit One Pager
Employers can be immediately repaid for the credit by lowering the quantity of payroll taxes they.