Lets talk first about Employee Retention Credit S Corp Shareholder :
Our group here what do these men doing everybody in this space is assisting teach people about ERC and uh always provide a gorgeous breakfast and have individuals truly discover the program we need to head to the space where we have the ability to display a few of the checks that we are getting for companies and I want to see that what is this this is uh hundreds of countless dollars literally Kevin hundreds of countless dollars so these are replicate copies of the letters that go to customers validating that the check is on the method I mean you know if you just start 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 mean it’s simply I suggest think about how many actual clients that went through the program yeah this is the very end this is the celebration at the end when the check is verified the numbers are confirmed 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
receive this you know the check is chosen sure and that’s when they pay so they do not pay anything till they actually receive the money they do not pay bottom line Wonder trust anything up until this letter is confirmed the check is on the method they deposit it into their savings account and they can truly trust Wonder trust that the process has been completed and how many you think you’ve processed because 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 need you need experts 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 speaking about something actually important today the worker retention credit which most of you have never ever heard of I definitely hadn’t heard of it till really recently and discovered a lot about it because this is probably the most affordable cost of capital for any small business anywhere
anytime if you have workers 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 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 just phone your bank manager and say offer me a loan it does not 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 become yes the Ambassador and paid representative for this I enjoy this program it’s going away very soon you got to learn all about it let’s talk employee retention credit Josh Fox what is an ERC let’s simply begin there so throughout the Trump Administration when President Trump was enacted they came up with the cares Act and the cares act offered services 3 opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and almost everyone it makes a big 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 cash payroll tax refund alright go on sorry I just have to ensure we got that point I indicate that’s a big distinction a loan versus money money I like money money that’s what we’re talking 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 beautiful difficult check in the mail where you get real cash from the internal revenue service all right so let’s discuss how it works because it sounds like to me if it’s a if it’s employee retention credit that individual had to be a staff member so I’m going to make the Assumption this money is not for the owner not for individuals on the cap table not for investors it’s for staff members right you needed to have owned a company however it’s based upon you having W-2 staff members in America not 10.99. so as long as you had W-2 staff members and you paid federal payroll taxes that’s why you would be eligible 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 correct so there were 6 quarters the program was open well stroll us through the six quarters so you had quarters two three and 4 of 2020 and you had quarters one 2 and 3 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 favorite part money just how much can you get back per employee that was on a W-2 in those 6 quarters so the computation in 2020 to be specific Kevin is 50 of the staff member’s salary to an optimum of five thousand dollars per worker for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the staff member’s wage to a maximum 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 mayhem of the pandemic so they wished to even get more to keep those staff members on payroll 100 so if you can get 5 000 per person Max in twenty that was 50 in 2020 up to 5 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 5 thousand in twenty twenty that’s twenty 6 thousand dollars per employee that is because that’s a great deal of money 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 reduce the 26 000 so what we’re seeing typically Kevin is if you took PPP cash someplace 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 workers and you took PPP cash you would still get a million dollar in the mail from the IRS so it’s substantial certainly now the big question is why does nobody know about this due to the fact that look when I first heard about this when I first met Josh you understand I have actually got great deals of financial investments in great deals of companies I’m a major advocate for entrepreneurship in America and make many many investments in entrepreneurs of which numerous suffered through the pandemic when I initially heard about this I called BS I do not believe it because I utilize 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 and that were well should have and we utilized them sensibly to survive throughout the pandemic so when I found out about this I stated nah it can’t be true however when I dug around I even contacted us to my political leader good friends Guv Senators they didn’t learn about it I imply that’s how you know 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 likewise not true so let’s ask Josh why does nobody understand about the staff member retention credit you know what’s intriguing you’re speaking about the banks Kevin since 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 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 just procedure process that’s all um and here there was mayhem because remember in the original cares act you could refrain from doing both programs so if you had actually done PPP you might not do ERC in the original program and when they altered the law in 2021 the banks were not doing ERC because it’s not alone so you’re getting a tax refund so the government never ever made it clear to anybody about how to.
do this does your CFO understand how to do this not truly he or she’s never done it before do the banks do it nope the banks don’t do it the payroll business yeah a few of them are doing it as a payroll company your accounting professional no your accounting professional’s never done this before unless you have an account that went into this company and bottom line my firm Kevin has been in business given that 2009 and we have actually 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 customers have worked with bottom line to recuperate other federal government programs we have actually done sales tax and utilize tax unemployment tax work opportunity tax credits research and development tax credits unclaimed home property tax all of these other government programs.
The employee 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 incomes paid by an.
company whose service is completely or partly suspended because of COVID-19 or whose gross receipts.
decline by more than 50%.
1. The credit is readily available to all companies no matter size consisting of tax exempt companies. There are.
just 2 exceptions: (1) state and local governments and their instrumentalities and (2) little.
businesses who take Small Business Loans.
2. To qualify, the company needs to fulfill one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the employer’s organization is fully or partly suspended by federal government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross receipts are below 50% of the comparable quarter in 2019. Once the.
company’s gross invoices exceed 80% of a comparable quarter in 2019 they no longer certify.
after the end of that quarter.
Computation of the Credit.
The amount of the credit is 50% of the certifying wages paid up to $10,000 in overall.
It works 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 concentrate on ERC filing help generally provide know-how and assistance to help organizations browse the intricate procedure of claiming the credit. They can use different services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit S Corp Shareholder
Eligibility Assessment: These companies will examine your organization’s eligibility for the ERC based upon aspects such as your industry, earnings, and operations. They can help figure out if you meet the requirements for the credit and determine the optimum credit quantity you can claim.
Paperwork and Computation: ERC filing services will help in collecting the essential documents, such as payroll records and monetary statements, to support your claim. They will likewise assist compute the credit quantity based upon qualified wages and other certifying expenditures.
Retroactive Claim Review: If you are eligible to declare the ERC for prior quarters, these business can examine your previous payroll records and financials to determine potential chances for retroactive credits. They can help you modify previous income tax return to declare these refunds.
Filing Help: Companies specializing in ERC filings will prepare and send the required kinds and paperwork on your behalf. This includes completing Form 941 or any other required tax return.
Compliance and Updates: ERC policies and assistance have developed in time. These business stay updated with the current changes and make sure that your filings comply with the most existing standards. They can likewise offer continuous assistance if the internal revenue service requests additional details or carries out an audit related to your ERC claim.
It is necessary to research and veterinarian any company using ERC filing help to ensure their credibility and know-how. Try to find established companies with experience in tax and payroll services, or consider connecting to trusted accounting firms or tax experts who use ERC submitting assistance.
Keep in mind that while these companies can provide important support, it’s constantly a good idea to have a fundamental understanding of the ERC requirements and procedure yourself. This will assist you make informed decisions and guarantee precise filings.
The Staff Member 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 maintain and pay their employees during the pandemic, even if their operations have been impacted.
Here are some key points about the ERC:.
Eligibility: The ERC is offered to eligible employers, including for-profit organizations, tax-exempt companies, and specific governmental entities. To certify, companies need to fulfill one of two requirements:.
The business operations were totally or partly suspended due to a government order related to COVID-19.
The business experienced a considerable decline in gross invoices. As pointed out previously, for 2021, a considerable decrease is specified as a 20% decrease in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a considerable decrease is defined as a 20% decrease in gross invoices 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 quantity amounts to a portion (up to 70%) of qualified wages paid to employees, including certain health insurance expenses. The optimum credit per employee is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, businesses that received a Paycheck Defense Program (PPP) loan were not eligible for the ERC. However, legislation passed in late 2020 and extended in 2021 permits organizations to claim the ERC even if they got a PPP loan. The very same earnings can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively expanded and enhanced, enabling qualified companies to claim the credit for qualified incomes paid as far back as March 13, 2020. This retroactive arrangement offers an opportunity for services to change prior-year income tax return and get refunds.
Claiming the Credit: Companies can declare the ERC by reporting it on their work income tax return, typically Type 941. If the credit exceeds the quantity of employment taxes owed, the excess can be reimbursed to the employer.
It is necessary to note that the ERC provisions and eligibility requirements have progressed with time. The very best course of action is to talk to a tax professional or visit the official internal revenue service site for the most in-depth and updated info concerning the ERC, consisting of any recent legislative modifications or updates.
To receive the ERC, a service must fulfill one of the following criteria:.
Business operations were fully or partially suspended due to a government order related to COVID-19.
The business experienced a substantial decrease in gross receipts. For 2021, a considerable decline is specified as a 20% decrease in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a significant decline is defined as a 20% decline in gross invoices compared to the exact same quarter in 2019, or a 20% decline in gross receipts compared to the right away preceding quarter.
The ERC is available to companies of all sizes, consisting of tax-exempt organizations, however there are some exceptions. Government entities and businesses that got a PPP loan may have constraints on claiming the credit.
The process for declaring the ERC includes finishing the necessary forms and including the credit on your employment tax return (generally Type 941). The exact time it takes to process the credit can differ based upon numerous factors, including the complexity of your organization and the work of the IRS. It’s recommended to talk to a tax professional for guidance particular to your situation.
There are a number of business that can assist with the process of declaring the ERC. Some popular companies that use assistance with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the details provided here is based upon general understanding and may not show the most recent updates or modifications to the ERC. It is very important to seek advice from a tax professional or visit the main IRS site for the most precise and updated information regarding eligibility, claiming treatments, and available help.
Less than 100. If the employer had 100 or less employees on average in 2019, then the credit is based.
on earnings paid to all employees whether they actually worked or not. Simply put, even if the.
workers worked full-time and made money for full time work, the company still gets the credit.
Greater than 100. The credit is if the employer had more than 100 staff members on average in 2019.
enabled just for earnings paid to employees who did not work throughout the calendar quarter.
In both cases, “earnings” includes not simply cash payments but likewise a portion of the expense of company.
offered healthcare. Employee Retention Credit S Corp Shareholder
Companies can be instantly compensated for the credit by lowering the quantity of payroll taxes they.