Lets talk first about Employee Retention Credit Refundable :
Our group here what do these men doing everyone in this room is helping teach individuals about ERC and uh constantly offer a beautiful breakfast and have individuals truly learn more about the program we need to head to the room where we are able to display some of the checks that we are getting for companies and I wish to see that what is this this is uh hundreds of countless dollars literally Kevin numerous millions of dollars so these are replicate copies of the letters that go to clients verifying that the check is on the method I indicate you understand if you just begin to look at a few of these here I mean this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I imply it’s simply I suggest 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 confirmed the numbers are validated and the check is on the mail in the mail from the IRS heading to the client so that’s how you’re able to track it you know when you
receive this you know the check is chosen sure and that’s when they pay so they don’t pay anything until they really receive the money they don’t pay bottom line Wonder trust anything till this letter is verified the check is on the way they deposit it into their bank account and they can genuinely rely on Wonder trust that the process has actually been finished and how many you believe you’ve processed considering that you started this we have to do with 35 000 of these for
about six billion dollars wow so clearly 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 among these that’s what matters all right Mr Fantastic here you’re at my YouTube channel we’re talking about something truly important today the worker retention credit which most of you have never ever become aware of I certainly had not heard of it till very recently and found out a lot about it since this is most likely the most affordable cost 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 specialist with me this is Josh Fox he’s the founder and CEO of bottom line Concepts 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 your bank supervisor and say 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’ve ended up being yes the Ambassador and paid spokesperson for this I like this program it’s disappearing soon you got to learn everything about it let’s talk staff member retention credit Josh Fox what is an ERC let’s simply begin there so during the Trump Administration when President Trump was enacted they created the cares Act and the cares act used organizations 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 huge difference right there 2 of them are loans and one’s a refund precisely so the ERC is a refund that’s.
remedy the cash money payroll tax refund alright go on sorry I simply need to make certain we got that point I suggest that’s a huge difference a loan versus money money I like money money 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 lovely difficult check in the mail where you get real money from the IRS all right so let’s talk about how it works since it seems like to me if it’s a if it’s worker retention credit that individual had to be a worker so I’m going to make the Presumption this money is not for the owner not for people on the cap table not for shareholders it’s for employees right you needed to have owned a service however it’s based upon you having W-2 staff members in America not 10.99. As long as you had W-2 employees 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 six months of 2021 on the W-2 right so there were 6 quarters the program was open well stroll us through the 6 quarters so you had quarters 2 three and 4 of 2020 and you had quarters one 2 and 3 of 2021. fine so that’s how it’s measured you have to be on the W-2 during that period now let’s talk my favorite part cash just how much can you get back per worker that was on a W-2 in those 6 quarters so the computation in 2020 to be specific Kevin is 50 of the worker’s wage to a maximum of 5 thousand dollars per worker for the year of 2020 and in 2021 the numbers escalated to 70 of the employee’s wage to an optimum of seven thousand per quarter how did that take place um they just changed the rules in.
2021 versus because the chaos of the pandemic so they wanted to even get more to keep those workers 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 happens 21 000 Max in 2021 oh that’s how you develop twenty six thousand twenty one thousand to twenty twenty one plus five thousand in twenty twenty that’s twenty 6 thousand dollars per worker that is because that’s a great deal of money it is now there’s a caveat here the PPP money would have to be lowered from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan two you would minimize the 26 000 so what we’re seeing on average 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 money you would still get a million dollar in the mail from the IRS so it’s big clearly now the big question is why does no one know about this because appearance when I first heard about this when I first fulfilled Josh you understand I’ve got great deals of financial investments in lots of business I’m a major advocate for entrepreneurship in America and make many numerous investments in business owners of which lots of suffered through the pandemic when I initially found out 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 extremely easy to do we had our CEOs call the banks they got their loans which were well deserved and we used them sensibly to stay alive throughout the pandemic so when I found out about this I stated nah it can’t be true but when I dug around I even contacted us to my politician good friends Governor Senators they didn’t know about it I mean that’s how you understand that’s how false information is that there’s no details out there then a bunch of individuals informed 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 staff member retention credit you know what’s intriguing you’re talking about the banks Kevin since in the PPP loan process 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 country and they would process process in Canada a pre-pp loan there’s no loans in Canada by the way it’s simply procedure procedure that’s all um and here there was chaos because remember in the initial cares act you might not do both programs so if you had done PPP you might refrain from doing ERC in the initial program and when they altered the law in 2021 the banks were refraining from doing ERC since 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 actually he or she’s never 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 company your accounting professional no your accountant’s never ever done this prior to unless you have an account that went into this company and bottom line my company Kevin has actually stayed in business given that 2009 and we’ve been working with the federal government and the state government to recuperate cash for Fortune 500 Fortune 1000 business so a great deal of our big huge corporate clients have worked with bottom line to recover other federal government programs we’ve done sales tax and utilize tax unemployment tax work chance tax credits research and development tax credits unclaimed property property tax all of these other federal government programs.
The employee retention tax credit is a broad based refundable tax credit developed to encourage.
companies to keep staff members on their payroll. The credit is 50% of up to $10,000 in wages paid by an.
employer whose organization is totally or partly suspended because of COVID-19 or whose gross invoices.
decrease 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 certify, the company needs to satisfy one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the company’s service is totally or partially suspended by government order due to COVID-19.
during the calendar quarter or.
o the company’s gross receipts are below 50% of the similar quarter in 2019. Once the.
company’s gross receipts exceed 80% of a comparable quarter in 2019 they no longer certify.
after completion of that quarter.
Calculation of the Credit.
The amount of the credit is 50% of the qualifying incomes paid up to $10,000 in total.
It is effective for incomes paid after March 13th and prior to December 31, 2020.
The meaning of qualifying wages varies by whether a company had, on average, basically than.
100 staff members in 2019.
Business that specialize in ERC filing assistance usually offer know-how and assistance to help services browse the intricate process of claiming the credit. They can offer numerous services, including:.
How is the employee retention credit calculated? Employee Retention Credit Refundable
Eligibility Evaluation: These companies will examine your service’s eligibility for the ERC based upon aspects such as your industry, revenue, and operations. They can help determine if you fulfill the requirements for the credit and identify the optimum credit amount you can claim.
Documentation and Calculation: ERC filing services will assist in gathering the needed documentation, such as payroll records and monetary statements, to support your claim. They will also assist calculate the credit quantity based upon eligible salaries and other qualifying expenditures.
Retroactive Claim Review: If you are qualified to claim the ERC for previous quarters, these business can evaluate your past payroll records and financials to identify potential chances for retroactive credits. They can help you change previous tax returns to declare these refunds.
Filing Support: Business focusing on ERC filings will prepare and send the required types and documents on your behalf. This consists of completing Form 941 or any other required tax return.
Compliance and Updates: ERC regulations and guidance have actually developed over time. These business stay updated with the latest modifications and ensure that your filings comply with the most present standards. They can also provide continuous assistance if the internal revenue service requests extra information or performs an audit related to your ERC claim.
It is necessary to research and veterinarian any business using ERC filing help to guarantee their trustworthiness and competence. Try to find recognized companies with experience in tax and payroll services, or consider reaching out to trusted accounting firms or tax specialists who provide ERC submitting assistance.
Bear in mind that while these business can offer important support, it’s always a good idea to have a standard understanding of the ERC requirements and process yourself. This will assist you make informed decisions and make sure precise filings.
The Employee Retention Credit (ERC) is a refundable tax credit presented by the U.S. government as part of COVID-19 relief measures. The objective of the ERC is to motivate organizations to keep and pay their workers throughout the pandemic, even if their operations have actually been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is offered to qualified companies, consisting of for-profit companies, tax-exempt companies, and particular governmental entities. To certify, employers must meet one of two criteria:.
The business operations were completely or partly suspended due to a federal government order related to COVID-19.
Business experienced a substantial decline in gross invoices. As pointed out earlier, for 2021, a considerable decrease 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 invoices compared to the exact same quarter in 2019, or a 20% decline in gross invoices compared to the immediately preceding quarter.
Credit Amount: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit amount amounts to a percentage (as much as 70%) of certified wages paid to workers, consisting of particular 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, businesses that got a Paycheck Defense Program (PPP) loan were not eligible for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 permits services to claim the ERC even if they received a PPP loan. However, the very same wages can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively broadened and improved, allowing qualified companies to declare the credit for certified earnings paid as far back as March 13, 2020. This retroactive arrangement provides a chance for companies to amend prior-year income tax return and receive refunds.
Declaring the Credit: Companies can claim the ERC by reporting it on their work income tax return, usually Kind 941. The excess can be refunded to the employer if the credit exceeds the quantity of work taxes owed.
It is essential to note that the ERC arrangements and eligibility requirements have developed gradually. The best strategy is to seek advice from a tax expert or visit the official internal revenue service site for the most up-to-date and in-depth info concerning the ERC, consisting of any recent legislative changes or updates.
To get approved for the ERC, a service must meet among the following criteria:.
Business operations were completely or partly suspended due to a government order related to COVID-19.
Business experienced a substantial decline in gross receipts. For 2021, a considerable decrease is defined as a 20% decrease in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a significant decrease is specified as a 20% decline in gross invoices compared to the exact same quarter in 2019, or a 20% decrease in gross invoices compared to the immediately preceding quarter.
The ERC is available to businesses of all sizes, including tax-exempt organizations, however there are some exceptions. For instance, federal government entities and organizations that got a PPP loan may have constraints on claiming the credit.
The procedure for claiming the ERC includes completing the required types and consisting of the credit on your employment tax return (usually Type 941). The exact time it takes to process the credit can differ based upon numerous aspects, including the intricacy of your business and the work of the internal revenue service. It’s recommended to seek advice from a tax expert for assistance specific to your scenario.
There are numerous business that can assist with the process of declaring the ERC. Some well-known companies that offer assistance with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the info supplied here is based upon general knowledge and may not reflect the most recent updates or modifications to the ERC. It’s important to consult with a tax professional or visit the main IRS website for the most accurate and updated information concerning eligibility, declaring procedures, and readily available assistance.
Less than 100. If the company had 100 or fewer staff members usually in 2019, then the credit is based.
on wages paid to all staff members whether they in fact worked or not. To put it simply, even if the.
staff members worked full time and got paid for full-time work, the employer still gets the credit.
Greater than 100. The credit is if the employer had more than 100 employees on average in 2019.
allowed only for salaries paid to staff members who did not work throughout the calendar quarter.
In both cases, “salaries” consists of not simply money payments however likewise a portion of the cost of company.
supplied health care. Employee Retention Credit Refundable
Employers can be immediately repaid for the credit by minimizing the amount of payroll taxes they.