Lets talk first about Form For Employee Retention Credit :
Our group here what do these guys doing everybody in this room is helping teach people about ERC and uh constantly offer a lovely breakfast and have people actually learn about the program we need to head to the room 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 millions of dollars so these are duplicate copies of the letters that go to customers confirming that the check is on the method I mean you understand if you simply begin to look at a few 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 simply I mean 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 confirmed and the check is on the mail in the mail from the internal revenue service heading to the client so that’s how you’re able to track it you know when you
receive this you understand the check is chosen sure and that’s when they pay so they do not pay anything up until they actually get the cash they do not pay bottom line Wonder trust anything up until this letter is verified the check is on the method they deposit it into their savings account and they can really rely on Wonder trust that the procedure has been finished and how many you think you’ve processed since you began this we have to do with 35 000 of these for
about 6 billion dollars wow so clearly they know what they’re doing and that’s what you require you require 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 Fantastic here you’re at my YouTube channel we’re discussing something really crucial today the staff member retention credit which most of you have actually never ever heard of I certainly had not become aware of it up until very recently and discovered a lot about it due to the fact that this is probably the most affordable expense of capital for any small business anywhere
anytime if you have employees between five and five hundred so I have actually got the professional 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 difficult this isn’t like PPP we simply call your bank supervisor 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 become yes the Ambassador and paid spokesperson for this I enjoy this program it’s going away very soon you got to learn all about it let’s talk staff member 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 offered services 3 opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly everyone it makes a huge distinction right there two of them are loans and one’s a refund exactly so the ERC is a refund that’s.
correct the cash cash payroll tax refund okay go on sorry I just need to make certain we got that point I suggest that’s a huge distinction a loan versus money cash I like cash 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 original cares Act is the ERC and yes Kevin it is a gorgeous difficult check in the mail where you get actual cash from the IRS all right so let’s discuss how it works due to the fact that it seems like to me if it’s a if it’s employee retention credit that person needed to be an employee 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 an organization but it’s based on you having W-2 workers in America not 10.99. so as long as you had W-2 employees 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 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 walk 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. fine so that’s how it’s measured you have to be on the W-2 throughout that duration now let’s talk my favorite part cash just how much can you return per staff member that was on a W-2 in those six quarters so the estimation in 2020 to be precise Kevin is 50 of the worker’s wage 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 income to a maximum of seven thousand per quarter how did that take place um they simply changed the rules in.
2021 versus since the turmoil of the pandemic so they wanted 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 five thousand Max and after that what takes place 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 worker that is since that’s a lot of cash it is now there’s a caution here the PPP money would need to be decreased from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan 2 you would decrease the 26 000 so what we’re seeing typically Kevin is if you took PPP cash somewhere around ten thousand dollars a person 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 internal revenue service so it’s substantial certainly now the huge concern is why does nobody learn about this since appearance when I initially heard about this when I first satisfied Josh you understand I’ve got lots of financial investments in lots of business I’m a major advocate for entrepreneurship in America and make numerous 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 think it due to the fact that I utilize the PPP we went through the cash center Banks to get it it was really easy to do we had our CEOs call the banks they got their loans which were well been worthy of and we utilized them wisely to stay alive throughout the pandemic so when I found out about this I stated nah it can’t hold true however when I dug around I even contacted us to my politician pals Guv Senators they didn’t learn about it I mean that’s how you know that’s how false information is that there’s no info out there then a bunch of individuals told me well you can’t get it due to the fact that you took the PPP likewise not real so let’s ask Josh why does no one learn about the employee retention credit you know what’s interesting you’re speaking about the banks Kevin because in the PPP loan process the federal government made it really clear that if you wanted 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 just process process that’s all um and here there was turmoil because remember in the initial cares act you might not do 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 government never made it clear to any person about how to.
do this does your CFO understand how to do this not really he or she’s never done it in the past do the banks do it nope the banks do not do it the payroll business yeah some of them are doing it as a payroll business your accountant no your accountant’s never ever done this before unless you have an account that went into this business and bottom line my firm Kevin has been in business considering 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 companies so a lot of our big huge corporate clients have actually dealt with bottom line to recuperate other government programs we have actually done sales tax and use tax joblessness tax work chance 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 employees on their payroll. The credit is 50% of up to $10,000 in salaries paid by an.
company whose organization is fully or partially suspended because of COVID-19 or whose gross invoices.
decrease by more than 50%.
Availability.
1. The credit is readily available to all companies no matter size consisting of tax exempt companies. There are.
only 2 exceptions: (1) state and local governments and their instrumentalities and (2) small.
services who take Small company Loans.
2. To qualify, the employer has to fulfill one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the employer’s service is totally 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 comparable quarter in 2019. Once the.
employer’s gross invoices exceed 80% of an equivalent quarter in 2019 they no longer qualify.
after the end 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 works for incomes paid after March 13th and before December 31, 2020.
The meaning of certifying incomes differs by whether an employer had, on average, basically than.
100 staff members in 2019.
Business that focus on ERC filing help normally offer knowledge and assistance to help services browse the complex procedure of declaring the credit. They can provide various services, consisting of:.
How is the employee retention credit calculated? Form For Employee Retention Credit
Eligibility Assessment: These companies will assess your organization’s eligibility for the ERC based on elements such as your industry, profits, and operations. If you satisfy the requirements for the credit and determine the maximum credit quantity you can declare, they can assist identify.
Paperwork and Computation: ERC filing services will help in gathering the necessary paperwork, such as payroll records and monetary statements, to support your claim. They will likewise help compute the credit amount based on eligible earnings and other certifying expenses.
Retroactive Claim Review: If you are qualified to claim the ERC for previous quarters, these companies can evaluate your past payroll records and financials to identify possible chances for retroactive credits. They can help you modify previous tax returns to claim these refunds.
Filing Assistance: Companies specializing in ERC filings will prepare and submit the required forms and paperwork in your place. This includes completing Type 941 or any other required tax forms.
Compliance and Updates: ERC guidelines and guidance have actually evolved in time. These companies stay updated with the latest changes and guarantee that your filings abide by the most existing guidelines. They can likewise supply ongoing support if the IRS requests additional details or conducts an audit related to your ERC claim.
It is very important to research study and veterinarian any business offering ERC filing help to guarantee their reliability and know-how. Search for recognized firms with experience in tax and payroll services, or consider connecting to trusted accounting companies or tax specialists who use ERC filing support.
Remember that while these companies can offer important support, it’s constantly a good concept to have a standard understanding of the ERC requirements and procedure yourself. This will assist you make informed choices and ensure accurate filings.
The Employee 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 services to maintain and pay their staff members during the pandemic, even if their operations have actually been impacted.
Here are some key points about the ERC:.
Eligibility: The ERC is readily available to eligible employers, including for-profit businesses, tax-exempt companies, and specific governmental entities. To certify, employers should meet one of two requirements:.
Business operations were fully or partially suspended due to a federal government order related to COVID-19.
The business experienced a significant decrease in gross receipts. As mentioned earlier, for 2021, a substantial decline is defined as a 20% decrease in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a substantial decrease is specified as a 20% decline in gross invoices compared to the very same quarter in 2019, or a 20% decline in gross invoices compared to the instantly preceding quarter.
Credit Amount: The ERC is a refundable tax credit that offsets the employer’s share of Social Security taxes. The credit quantity amounts to a percentage (as much as 70%) of certified earnings paid to employees, including particular health plan expenditures. 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, organizations that got a Paycheck Security Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 allows companies to declare the ERC even if they received a PPP loan. The exact same earnings can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively broadened and enhanced, allowing qualified companies to claim the credit for certified salaries paid as far back as March 13, 2020. This retroactive arrangement offers an opportunity for businesses to modify prior-year tax returns and receive refunds.
Declaring the Credit: Employers can declare the ERC by reporting it on their work income tax return, typically Type 941. If the credit goes beyond the quantity of work taxes owed, the excess can be refunded to the employer.
It is essential to keep in mind that the ERC provisions and eligibility requirements have actually developed over time. The best strategy is to talk to a tax expert or go to the main internal revenue service site for the most in-depth and updated information relating to the ERC, including any current legislative modifications or updates.
To receive the ERC, an organization needs to fulfill among the following requirements:.
The business operations were completely or partially suspended due to a federal government order related to COVID-19.
The business experienced a considerable decline in gross receipts. For 2021, a substantial decline is specified as a 20% decrease in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a considerable decline is specified as a 20% decline in gross receipts compared to the very same quarter in 2019, or a 20% decrease in gross invoices compared to the instantly preceding quarter.
The ERC is available to companies of all sizes, consisting of tax-exempt organizations, however there are some exceptions. Government entities and organizations that received a PPP loan might have restrictions on claiming the credit.
The procedure for claiming the ERC includes finishing the essential types and consisting of the credit on your employment income tax return (generally Type 941). The exact time it requires to process the credit can differ based on a number of elements, including the intricacy of your company and the workload of the IRS. It’s suggested to talk to a tax professional for assistance particular to your situation.
There are numerous business that can help with the procedure of claiming the ERC. Some well-known companies that offer support with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the info provided here is based on general knowledge and may not reflect the most current updates or changes to the ERC. It is essential to seek advice from a tax professional or visit the official internal revenue service site for the most updated and accurate info concerning eligibility, claiming procedures, and offered assistance.
Less than 100. The credit is based if the company had 100 or fewer employees on average in 2019.
on earnings paid to all staff members 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. The credit is if the employer had more than 100 workers on average in 2019.
enabled just for earnings paid to employees who did not work throughout the calendar quarter.
In both cases, “salaries” includes not simply cash payments but likewise a portion of the expense of employer.
provided healthcare. Form For Employee Retention Credit
Payment.
Employers can be right away compensated for the credit by lowering the amount of payroll taxes they.