Lets talk first about Employee Retention Credits For 2022 :
Our group here what do these men doing everybody in this space is assisting teach people about ERC and uh always supply a lovely breakfast and have individuals actually learn about the program we must head to the space where we have the ability to display some of the checks that we are getting for business 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 confirming that the check is on the method I indicate you understand if you just begin to look at a few of these here I indicate this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I imply it’s simply I imply think about 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 verified the numbers are validated and the check is on the mail in the mail from the internal revenue service heading to the consumer so that’s how you’re able to track it you understand when you
receive this you understand the check is gone for sure and that’s when they pay so they don’t pay anything till they really receive the money they don’t pay bottom line Wonder trust anything up until this letter is confirmed the check is on the method they deposit it into their bank account and they can really rely on Wonder trust that the procedure has actually been completed and how many you think you’ve processed given that you started this we have to do with 35 000 of these for
about six billion dollars wow so plainly they understand what they’re doing which’s what you need you need professionals 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 talking about something actually essential today the staff member retention credit which the majority of you have never heard of I definitely hadn’t become aware of it till very recently and discovered a lot about it due to the fact that this is most likely the lowest expense of capital for any small business anywhere
anytime if you have staff members in between five and five hundred so I’ve got the expert with me this is Josh Fox he’s the creator and CEO of bottom line Principles they’re the biggest 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 supervisor and state offer me a loan it does not work there’s not a loan it’s an application and Josh is going to tell us all about it and how to get it and why I’ve ended up being yes the Ambassador and paid representative for this I love this program it’s disappearing very soon you got to find out everything about it let’s talk worker retention credit Josh Fox what is an ERC let’s simply begin there so during the Trump Administration when President Trump was enacted they developed the cares Act and the cares act provided services 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 huge distinction right there two 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 okay go on sorry I simply have to make sure we got that point I mean that’s a huge distinction a loan versus cash cash I like money cash that’s what we’re speaking about fine 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 tough check in the mail where you get actual money from the internal revenue service all right so let’s talk about how it works due to the fact that it sounds like to me if it’s a if it’s staff member retention credit that individual had to be an employee so I’m going to make the Assumption this cash is not for the owner not for people on the cap table not for shareholders it’s for employees right you had to have actually owned a business however it’s based upon you having W-2 staff members in America not 10.99. As long as you had W-2 staff members 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 correct so there were 6 quarters the program was open well stroll us through the 6 quarters so you had quarters 2 three and four of 2020 and you had quarters one 2 and 3 of 2021. all right so that’s how it’s measured you need to be on the W-2 during that period now let’s talk my favorite part money 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 precise Kevin is 50 of the staff member’s salary to a maximum of five thousand dollars per worker for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the staff member’s income to an optimum of 7 thousand per quarter how did that happen um they just altered the rules in.
2021 versus since the chaos 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 as much as 5 thousand Max and then 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 worker that is since that’s a great deal of money it is now there’s a caveat here the PPP cash would have to be lowered from the twenty six thousand dollars so if you took PPP loan one and PPP loan two you would decrease the 26 000 so what we’re seeing typically Kevin is if you took PPP cash someplace around ten thousand dollars a person so let’s state hypothetically you owned a restaurant in New York City where I’m from and you had a hundred staff members and you took PPP money you would still get a million dollar in the mail from the IRS so it’s substantial undoubtedly now the big concern is why does nobody learn about this because appearance when I initially found out about this when I first satisfied Josh you know I’ve got great deals of financial investments in great deals of companies I’m a major advocate for entrepreneurship in America and make many many financial investments in business owners of which many suffered through the pandemic when I initially heard about this I called BS I do not believe it because 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 been worthy of and we used them wisely to stay alive throughout the pandemic so when I became aware of this I said nah it can’t be true but when I dug around I even contacted us to my political leader pals Guv Senators they didn’t know about it I imply that’s how you understand that’s how false information is that there’s no information out there then a bunch of people informed 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 learn about the worker retention credit you understand what’s interesting you’re discussing the banks Kevin because in the PPP loan process the federal government made it very 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 simply procedure procedure that’s all um and here there was chaos due to the fact that keep in mind in the original cares act you could 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 not 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 any person about how to.
do this does your CFO understand how to do this not truly she or he’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 accountant no your accounting professional’s never ever done this before unless you have an account that went into this service and bottom line my company Kevin has stayed in business since 2009 and we’ve been working with the federal government and the state government to recover cash for Fortune 500 Fortune 1000 business so a great deal of our big big corporate customers have actually worked with bottom line to recover other government programs we have actually done sales tax and utilize tax joblessness tax work chance tax credits research and development tax credits unclaimed home real estate tax all of these other federal government programs.
The staff member retention tax credit is a broad based refundable tax credit designed to motivate.
companies to keep employees on their payroll. The credit is 50% of as much as $10,000 in wages paid by an.
employer whose business is completely or partially suspended because of COVID-19 or whose gross invoices.
decline by more than 50%.
Availability.
1. The credit is readily available to all employers no matter size including tax exempt companies. There are.
only two exceptions: (1) state and local governments and their instrumentalities and (2) small.
services who take Small company Loans.
2. To qualify, the employer needs to fulfill one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the company’s business is fully or partially suspended by federal government order due to COVID-19.
during the calendar quarter or.
o the company’s gross receipts are listed below 50% of the comparable quarter in 2019. Once the.
company’s gross invoices exceed 80% of a similar quarter in 2019 they no longer qualify.
after the end of that quarter.
Estimation of the Credit.
The quantity of the credit is 50% of the certifying earnings paid up to $10,000 in overall.
It works for wages paid after March 13th and prior to December 31, 2020.
The definition of certifying earnings differs by whether a company had, usually, more or less than.
100 workers in 2019.
Companies that concentrate on ERC filing support usually supply know-how and support to assist companies navigate the complex procedure of claiming the credit. They can offer various services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credits For 2022
Eligibility Assessment: These business will evaluate your business’s eligibility for the ERC based on elements such as your market, profits, and operations. If you fulfill the requirements for the credit and determine the maximum credit quantity you can declare, they can assist figure out.
Documents and Estimation: ERC filing services will assist in gathering the required documents, such as payroll records and monetary statements, to support your claim. They will also help determine the credit amount based upon eligible salaries and other qualifying expenses.
Retroactive Claim Evaluation: If you are qualified to claim the ERC for previous quarters, these business can examine your previous payroll records and financials to recognize prospective opportunities for retroactive credits. They can help you change previous income tax return to claim these refunds.
Filing Help: Business specializing in ERC filings will prepare and submit the essential kinds and paperwork on your behalf. This consists of finishing Type 941 or any other necessary tax forms.
Compliance and Updates: ERC policies and guidance have actually progressed gradually. These business remain upgraded with the most recent modifications and make sure that your filings comply with the most current standards. They can also offer continuous support if the internal revenue service requests additional details or conducts an audit related to your ERC claim.
It is essential to research and veterinarian any company using ERC filing assistance to guarantee their reliability and know-how. Look for established firms with experience in tax and payroll services, or think about connecting to trusted accounting companies or tax experts who provide ERC submitting support.
Bear in mind that while these companies can supply valuable assistance, it’s always a good concept to have a basic understanding of the ERC requirements and procedure yourself. This will help you make informed choices and ensure accurate filings.
The Worker Retention Credit (ERC) is a refundable tax credit presented by the U.S. federal government as part of COVID-19 relief measures. The goal of the ERC is to encourage companies to keep and pay their workers during the pandemic, even if their operations have been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is available to eligible companies, including for-profit organizations, tax-exempt companies, and certain governmental entities. To certify, companies need to satisfy one of two criteria:.
The business operations were completely or partially suspended due to a federal government order related to COVID-19.
The business experienced a substantial decline in gross invoices. As discussed earlier, for 2021, a considerable decline 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 specified as a 20% decrease in gross invoices compared to the very same quarter in 2019, or a 20% decline in gross invoices compared to the immediately preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the employer’s share of Social Security taxes. The credit quantity amounts to a portion (approximately 70%) of qualified incomes paid to workers, including specific health insurance expenditures. The maximum credit per staff member is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, organizations that got a Paycheck Security Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 enables services to declare the ERC even if they got a PPP loan. Nevertheless, 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 improved, permitting eligible employers to claim the credit for qualified salaries paid as far back as March 13, 2020. This retroactive provision offers an opportunity for organizations to modify prior-year income tax return and get refunds.
Declaring the Credit: Companies can claim the ERC by reporting it on their employment income tax return, usually Kind 941. The excess can be reimbursed to the employer if the credit goes beyond the quantity of work taxes owed.
It is very important to keep in mind that the ERC arrangements and eligibility requirements have actually progressed gradually. The best strategy is to seek advice from a tax expert or go to the official internal revenue service website for the most updated and comprehensive information regarding the ERC, consisting of any recent legal changes or updates.
To get approved for the ERC, a business needs to fulfill among the following requirements:.
Business operations were fully or partly suspended due to a government order related to COVID-19.
The business experienced a considerable decrease in gross receipts. For 2021, a substantial decrease is defined as a 20% decrease in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a considerable 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.
The ERC is available to businesses of all sizes, consisting of tax-exempt organizations, but there are some exceptions. For instance, federal government entities and businesses that received a PPP loan might have constraints on declaring the credit.
The process for claiming the ERC includes completing the necessary kinds and including the credit on your work income tax return (usually Kind 941). The exact time it requires to process the credit can differ based upon several factors, including the complexity of your business and the work of the internal revenue service. It’s suggested to seek advice from a tax expert for guidance particular to your scenario.
There are numerous business that can aid with the procedure of declaring the ERC. These consist of accounting companies, tax advisory services, and payroll provider. Some popular business that provide support with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s a good idea to research and contact these business directly to inquire about their fees and services.
Please note that the information offered here is based on general knowledge and might not reflect the most recent updates or changes to the ERC. It’s important to seek advice from a tax expert or check out the main internal revenue service site for the most up-to-date and precise information relating to eligibility, declaring treatments, and available help.
Less than 100. If the company had 100 or less employees on average in 2019, then the credit is based.
on salaries paid to all staff members whether they actually worked or not. In other words, even if the.
staff members worked full-time and made money for full time work, the employer still gets the credit.
Greater than 100. The credit is if the company had more than 100 workers on average in 2019.
permitted just for incomes paid to staff members who did not work throughout the calendar quarter.
In both cases, “wages” includes not simply cash payments however likewise a part of the cost of employer.
supplied health care. Employee Retention Credits For 2022
Payment.
Companies can be immediately repaid for the credit by reducing the quantity of payroll taxes they.