Lets talk first about Employee Retention Credit Proposal :
Our group here what do these guys doing everyone in this room is assisting teach people about ERC and uh always provide a lovely breakfast and have individuals truly discover the program we must 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 millions of dollars actually Kevin numerous countless dollars so these are duplicate copies of the letters that go to clients validating that the check is on the method I indicate you understand if you just begin to look at some of these here I suggest this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I suggest it’s just I imply think of the number of actual clients that went through the program yeah this is the very end this is the celebration at the end when the check is validated the numbers are verified and the check is on the mail in the mail from the IRS heading to the customer so that’s how you’re able to track it you know when you
get this you understand the check is chosen sure and that’s when they pay so they do not pay anything till they really receive the cash they do not pay bottom line Wonder trust anything up until this letter is validated the check is on the method they deposit it into their savings account and they can truly rely on Wonder trust that the process has actually been finished and the number of you think you have actually processed since 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 which’s what you require you need experts 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 Terrific here you’re at my YouTube channel we’re speaking about something truly important today the worker retention credit which most of you have actually never ever become aware of I definitely had not become aware of it up until really recently and discovered a lot about it since this is probably the lowest expense of capital for any small business anywhere
anytime if you have staff members in between 5 and five hundred so I have actually 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 challenging this isn’t like PPP we just call up your bank manager and state give me a loan it doesn’t work there’s not a loan it’s an application and Josh is going to tell all of us 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 disappearing soon you got to find out everything 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 developed the cares Act and the cares act offered companies three opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and almost everyone it makes a huge distinction right there 2 of them are loans and one’s a refund exactly so the ERC is a refund that’s.
fix the money cash payroll tax refund alright go on sorry I just have to make sure we got that point I suggest that’s a big difference a loan versus money money I like cash cash that’s what we’re speaking 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 initial cares Act is the ERC and yes Kevin it is a gorgeous difficult check in the mail where you get actual money from the internal revenue service all right so let’s talk about how it works since it sounds like to me if it’s a if it’s staff member retention credit that individual needed to be a staff member so I’m going to make the Assumption this cash is not for the owner not for individuals on the cap table not for shareholders it’s for staff members right you needed to have owned an organization however it’s based on 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 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 proper so there were 6 quarters the program was open well walk 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 need to be on the W-2 during that duration now let’s talk my preferred part money 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 precise Kevin is 50 of the employee’s wage to an optimum of 5 thousand dollars per staff member for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the employee’s wage to a maximum of 7 thousand per quarter how did that occur um they just altered the rules in.
2021 versus since the mayhem 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 5 thousand Max and after that what happens 21 000 Max in 2021 oh that’s how you develop twenty six thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty 6 thousand dollars per staff member that is because that’s a great deal of cash it is now there’s a caveat here the PPP cash would have to be reduced 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 on average Kevin is if you took PPP cash somewhere around ten 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 IRS so it’s huge undoubtedly now the big question is why does no one know about this because look when I initially became aware of this when I first fulfilled Josh you know I’ve got lots of financial investments in great deals of companies I’m a significant advocate for entrepreneurship in America and make many many investments in business owners of which many suffered through the pandemic when I initially heard about this I called BS I do not think it due to the fact that I use 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 been worthy of and we used them sensibly to stay alive during the pandemic so when I found out about this I said nah it can’t hold true however when I dug around I even contacted us to my politician good friends Governor Senators they didn’t learn about it I imply that’s how you understand that’s how false information is that there’s no details out there then a lot of individuals told me well you can’t get it due to the fact that you took the PPP also not real so let’s ask Josh why does nobody know about the employee retention credit you understand what’s intriguing you’re discussing the banks Kevin due to the fact that in the PPP loan procedure the federal government made it really 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 simply process process that’s all um and here there was turmoil due to the fact that remember in the initial cares act you might refrain from doing 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 not doing ERC because it’s not alone so you’re getting a tax refund so the federal government never made it clear to anybody about how to.
do this does your CFO know how to do this not really he or she’s never done it before 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 company your accounting professional no your accounting professional’s never done this prior to unless you have an account that entered into this organization and bottom line my firm Kevin has actually been in business considering that 2009 and we have actually been working with the federal government and the state government to recuperate money for Fortune 500 Fortune 1000 companies so a lot of our big huge business clients have actually worked with bottom line to recover other federal government programs we’ve done sales tax and use tax unemployment tax work chance tax credits research and development tax credits unclaimed property real estate tax all of these other government programs.
The staff member retention tax credit is a broad based refundable tax credit developed to encourage.
companies to keep workers on their payroll. The credit is 50% of as much as $10,000 in wages paid by an.
employer whose organization is completely or partially suspended because of COVID-19 or whose gross invoices.
decline by more than 50%.
1. The credit is available to all companies no matter size consisting of tax exempt companies. There are.
only 2 exceptions: (1) state and city governments and their instrumentalities and (2) little.
organizations who take Small company Loans.
2. To certify, the employer needs to meet one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the company’s company is fully 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 similar quarter in 2019. As soon as the.
employer’s gross invoices exceed 80% of a similar quarter in 2019 they no longer certify.
after completion of that quarter.
Estimation of the Credit.
The amount of the credit is 50% of the certifying wages paid up to $10,000 in total.
It is effective for wages paid after March 13th and prior to December 31, 2020.
The definition of qualifying incomes differs by whether an employer had, on average, basically than.
100 staff members in 2019.
Companies that specialize in ERC filing support generally offer competence and assistance to help organizations navigate the complex procedure of claiming the credit. They can provide various services, including:.
How is the employee retention credit calculated? Employee Retention Credit Proposal
Eligibility Assessment: These companies will examine your business’s eligibility for the ERC based on elements such as your market, earnings, and operations. They can help figure out if you satisfy the requirements for the credit and recognize the maximum credit quantity you can declare.
Documents and Calculation: ERC filing services will assist in gathering the essential documents, such as payroll records and financial declarations, to support your claim. They will also assist compute the credit quantity based upon qualified incomes and other qualifying costs.
Retroactive Claim Review: If you are eligible to declare the ERC for previous quarters, these business can review your previous payroll records and financials to recognize possible chances for retroactive credits. They can assist you change previous income tax return to claim these refunds.
Filing Help: Companies concentrating on ERC filings will prepare and send the essential kinds and documents in your place. This includes finishing Kind 941 or any other necessary tax return.
Compliance and Updates: ERC guidelines and assistance have developed over time. These business remain upgraded with the latest modifications and make sure that your filings abide by the most current standards. They can also offer continuous support if the internal revenue service demands extra information or carries out an audit related to your ERC claim.
It’s important to research and veterinarian any business offering ERC filing assistance to guarantee their credibility and competence. Try to find recognized companies with experience in tax and payroll services, or consider reaching out to trusted accounting companies or tax experts who use ERC filing support.
Keep in mind that while these companies can provide valuable support, it’s constantly an excellent idea to have a standard understanding of the ERC requirements and procedure yourself. This will help you make notified decisions and make sure precise filings.
The Worker Retention Credit (ERC) is a refundable tax credit introduced by the U.S. federal government as part of COVID-19 relief measures. The objective of the ERC is to encourage companies to maintain and pay their workers throughout the pandemic, even if their operations have been affected.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is available to qualified companies, consisting of for-profit companies, tax-exempt organizations, and particular governmental entities. To qualify, companies must fulfill one of two criteria:.
Business operations were fully or partly suspended due to a government order related to COVID-19.
The business experienced a substantial decrease in gross invoices. As discussed previously, for 2021, a significant decline is defined as a 20% decline in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a significant decline is specified as a 20% decline in gross receipts compared to the 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 company’s share of Social Security taxes. The credit amount is equal to a portion (as much as 70%) of qualified wages paid to employees, consisting of 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, services that received a Paycheck Security Program (PPP) loan were not qualified for the ERC. However, legislation passed in late 2020 and extended in 2021 allows companies to claim the ERC even if they received a PPP loan. The exact same salaries can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively expanded and enhanced, allowing qualified employers to claim the credit for certified earnings paid as far back as March 13, 2020. This retroactive arrangement provides a chance for businesses to amend prior-year income tax return and get refunds.
Declaring the Credit: Employers can declare the ERC by reporting it on their employment income tax return, normally Type 941. The excess can be refunded to the company if the credit exceeds the quantity of employment taxes owed.
It’s important to keep in mind that the ERC provisions and eligibility requirements have evolved in time. The very best strategy is to talk to a tax expert or go to the official internal revenue service site for the most detailed and up-to-date information relating to the ERC, consisting of any recent legislative changes or updates.
To qualify for the ERC, a business needs to satisfy one of the following requirements:.
Business operations were fully or partly suspended due to a federal government order related to COVID-19.
Business experienced a significant decrease in gross invoices. For 2021, a substantial decrease is specified as a 20% decrease in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a considerable decline is defined as a 20% decrease in gross receipts compared to the same quarter in 2019, or a 20% decline in gross receipts compared to the instantly preceding quarter.
The ERC is readily available to companies of all sizes, consisting of tax-exempt organizations, but there are some exceptions. For example, government entities and services that received a PPP loan might have constraints on claiming the credit.
The process for claiming the ERC involves completing the required types and including the credit on your work income tax return (typically Kind 941). The exact time it requires to process the credit can differ based upon a number of aspects, including the intricacy of your organization and the workload of the IRS. It’s advised to speak with a tax professional for guidance specific to your scenario.
There are a number of companies that can help with the procedure of declaring the ERC. Some widely known business that provide help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the information provided here is based on basic understanding and may not reflect the most recent updates or changes to the ERC. It is necessary to seek advice from a tax expert or check out the main IRS site for the most current and accurate information relating to eligibility, declaring procedures, and offered help.
Less than 100. If the employer had 100 or fewer workers usually in 2019, then the credit is based.
on earnings paid to all workers whether they in fact worked or not. Simply put, even if the.
workers worked full time and made money for full-time work, the employer still gets the credit.
Greater than 100. If the employer had more than 100 workers usually in 2019, then the credit is.
permitted just for wages paid to staff members who did not work during the calendar quarter.
In both cases, “incomes” consists of not simply money payments however also a portion of the cost of company.
supplied healthcare. Employee Retention Credit Proposal
Employers can be instantly compensated for the credit by lowering the quantity of payroll taxes they.