Lets talk first about How Do I Take The Employee Retention Credit :
Our team here what do these guys doing everyone in this space is helping teach individuals about ERC and uh constantly supply a stunning breakfast and have individuals really learn more about the program we need to head to the room where we are able to show some of the checks that we are getting for business and I wish to see that what is this this is uh numerous millions of dollars actually Kevin numerous countless dollars so these are replicate copies of the letters that go to clients confirming that the check is on the way I suggest you know 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 mean it’s simply I mean think about the number of real 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 confirmed and the check is on the mail in the mail from the internal revenue service heading to the customer so that’s how you’re able to track it you understand when you
receive this you know the check is opted for sure and that’s when they pay so they do not pay anything until they actually receive the cash they do not pay bottom line Wonder trust anything until this letter is verified the check is on the method they deposit it into their checking account and they can really trust Wonder trust that the procedure has been ended up and how many you think you have actually 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 and that’s what you require you require specialists 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 discussing something truly essential today the staff member retention credit which the majority of you have actually never heard of I definitely had not heard of it up until very recently and found out a lot about it because this is probably the lowest expense of capital for any small business anywhere
anytime if you have workers 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 Principles they’re the biggest processor of these ERC credits this is a 170 page program so it’s not easy this isn’t like PPP we just contact your bank manager and state provide me a loan it doesn’t 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 have actually become yes the Ambassador and paid representative for this I love this program it’s going away soon you got to discover everything about it let’s talk employee retention credit Josh Fox what is an ERC let’s simply start there so during the Trump Administration when President Trump was enacted they created the cares Act and the cares act provided companies 3 chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically everyone it makes a huge difference right there 2 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 all right go on sorry I just need to make sure we got that point I indicate that’s a huge difference a loan versus money cash I like money money that’s what we’re talking 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 original cares Act is the ERC and yes Kevin it is a beautiful difficult check in the mail where you get real cash from the IRS all right so let’s discuss how it works since 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 Presumption this money is not for the owner not for people 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 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 qualified so you have to be on payroll in 2020 on the W-2 and you have to be on payroll for the very first six months of 2021 on the W-2 right so there were 6 quarters the program was open well stroll us through the six 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 determined you need to be on the W-2 during that duration now let’s talk my favorite part money just how much can you return per employee that was on a W-2 in those six quarters so the calculation in 2020 to be exact Kevin is 50 of the worker’s income to a maximum of five thousand dollars per staff member for the year of 2020 and in 2021 the numbers escalated to 70 of the employee’s income to a maximum of 7 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 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 as much as five thousand Max and then what occurs 21 000 Max in 2021 oh that’s how you create 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 since that’s a great deal of cash 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 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 staff members and you took PPP money you would still get a million dollar in the mail from the internal revenue service so it’s big undoubtedly now the huge concern is why does no one learn about this since appearance when I initially became aware of this when I first satisfied Josh you understand I have actually got lots of investments in great deals of business I’m a major advocate for entrepreneurship in America and make numerous numerous investments in business owners of which many suffered through the pandemic when I initially became aware of this I called BS I don’t think it because I use the PPP we went through the cash center Banks to get it it was very easy to do we had our CEOs call the banks they got their loans and that were well been worthy of and we used them carefully to survive throughout the pandemic so when I heard about this I said nah it can’t be true but when I dug around I even called to my political leader friends Governor Senators they didn’t understand about it I indicate that’s how you know that’s how misinformation is that there’s no details out there then a bunch of people informed me well you can’t get it because you took the PPP also not real so let’s ask Josh why does nobody know about the staff member retention credit you understand what’s interesting you’re discussing the banks Kevin because in the PPP loan procedure 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 huge 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 process procedure that’s all um and here there was mayhem because remember in the original cares act you could not do both programs so if you had 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 due to the fact that it’s not alone so you’re getting a tax refund so the government never ever made it clear to any person about how to.
do this does your CFO know how to do this not truly she or he’s never ever done it before do the banks do it nope the banks do not do it the payroll business yeah a few 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 entered into this service and bottom line my company Kevin has stayed in business given that 2009 and we’ve been dealing with the federal government and the state federal government to recover cash for Fortune 500 Fortune 1000 companies so a lot of our big huge corporate clients have dealt with bottom line to recover other federal government programs we’ve done sales tax and utilize tax unemployment tax work opportunity tax credits research and development tax credits unclaimed property property tax all of these other federal government programs.
The staff member retention tax credit is a broad based refundable tax credit designed to encourage.
employers to keep workers on their payroll. The credit is 50% of up to $10,000 in salaries paid by an.
company whose organization is completely or partly suspended because of COVID-19 or whose gross receipts.
decline by more than 50%.
1. The credit is available to all employers despite size including tax exempt companies. There are.
just 2 exceptions: (1) state and city governments and their instrumentalities and (2) small.
organizations who take Small Business Loans.
2. To certify, the employer needs to satisfy one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the company’s service is fully or partially 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 equivalent quarter in 2019. As soon as the.
employer’s gross receipts go above 80% of an equivalent quarter in 2019 they no longer certify.
after completion of that quarter.
Estimation of the Credit.
The quantity of the credit is 50% of the qualifying wages paid up to $10,000 in overall.
It is effective for incomes paid after March 13th and before December 31, 2020.
The meaning of certifying salaries differs by whether an employer had, typically, more or less than.
100 workers in 2019.
Companies that specialize in ERC filing assistance typically provide know-how and support to assist businesses navigate the complex process of claiming the credit. They can provide numerous services, consisting of:.
How is the employee retention credit calculated? How Do I Take The Employee Retention Credit
Eligibility Assessment: These companies will assess your business’s eligibility for the ERC based upon elements such as your market, earnings, and operations. If you meet the requirements for the credit and recognize the maximum credit quantity you can declare, they can help determine.
Documents and Calculation: ERC filing services will assist in collecting the necessary documentation, such as payroll records and monetary declarations, to support your claim. They will likewise assist compute the credit quantity based on qualified earnings and other certifying expenses.
Retroactive Claim Review: If you are qualified to claim the ERC for previous quarters, these companies can evaluate your previous payroll records and financials to determine potential chances for retroactive credits. They can assist you modify prior income tax return to declare these refunds.
Filing Assistance: Business specializing in ERC filings will prepare and send the needed kinds and documentation on your behalf. This includes completing Form 941 or any other necessary tax return.
Compliance and Updates: ERC regulations and assistance have developed gradually. These companies stay upgraded with the latest modifications and guarantee that your filings comply with the most current guidelines. They can likewise offer continuous support if the internal revenue service requests extra details or conducts an audit related to your ERC claim.
It is very important to research study and vet any company providing ERC filing assistance to ensure their trustworthiness and expertise. Try to find recognized firms with experience in tax and payroll services, or consider connecting to relied on accounting companies or tax experts who provide ERC filing assistance.
Remember that while these business can offer valuable assistance, it’s always a great concept to have a fundamental understanding of the ERC requirements and process yourself. This will help you make notified decisions and ensure precise filings.
The Worker Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief procedures. The objective of the ERC is to motivate services to maintain and pay their workers throughout the pandemic, even if their operations have actually been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is offered to qualified employers, including for-profit organizations, tax-exempt companies, and particular governmental entities. To qualify, companies must fulfill one of two criteria:.
Business operations were completely or partially suspended due to a federal government order related to COVID-19.
Business experienced a considerable decline in gross invoices. As mentioned previously, for 2021, a substantial decrease is defined as a 20% decline in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a substantial 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 immediately preceding quarter.
Credit Amount: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit quantity is equal to a portion (approximately 70%) of certified earnings paid to employees, including particular health plan expenditures. The maximum credit per employee is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: At first, services that got a Paycheck Protection Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 permits organizations to declare the ERC even if they received a PPP loan. However, the exact same wages can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively broadened and boosted, enabling qualified employers to claim the credit for qualified incomes paid as far back as March 13, 2020. This retroactive provision offers a chance for companies to modify prior-year income tax return and get refunds.
Claiming the Credit: Companies can declare the ERC by reporting it on their work tax returns, normally Kind 941. The excess can be refunded to the company if the credit goes beyond the quantity of employment taxes owed.
It is very important to keep in mind that the ERC provisions and eligibility criteria have developed gradually. The best strategy is to seek advice from a tax expert or visit the official IRS website for the most up-to-date and in-depth info relating to the ERC, including any recent legislative changes or updates.
To get approved for the ERC, a business should satisfy one of the following 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 receipts. For 2021, a significant decline is defined as a 20% decline in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a substantial 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 immediately preceding quarter.
The ERC is readily available to services of all sizes, including tax-exempt organizations, however there are some exceptions. For example, government entities and companies that received a PPP loan may have restrictions on declaring the credit.
The process for claiming the ERC includes finishing the needed forms and consisting of the credit on your work income tax return (normally Form 941). The exact time it takes to process the credit can differ based on a number of aspects, including the complexity of your company and the work of the IRS. It’s suggested to talk to a tax professional for guidance specific to your scenario.
There are a number of companies that can help with the procedure of claiming the ERC. Some popular companies that offer assistance with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the information offered here is based upon basic understanding and might not show the most recent updates or modifications to the ERC. It is necessary to talk to a tax professional or go to the main internal revenue service website for the most accurate and up-to-date info relating to eligibility, claiming treatments, and readily available help.
Less than 100. If the employer had 100 or fewer employees usually in 2019, then the credit is based.
on earnings paid to all employees whether they really worked or not. In other words, 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 company had more than 100 workers on average in 2019.
permitted only for wages paid to workers who did not work during the calendar quarter.
In both cases, “incomes” includes not simply money payments but also a part of the expense of employer.
supplied health care. How Do I Take The Employee Retention Credit
Employers can be instantly reimbursed for the credit by minimizing the quantity of payroll taxes they.