Lets talk first about How To File The Employee Retention Credit :
Our group here what do these men doing everybody in this room is assisting teach people about ERC and uh always supply a lovely breakfast and have people truly learn about the program we should head to the space where we are able to show a few of the checks that we are getting for companies and I ‘d like to see that what is this this is uh numerous countless dollars literally Kevin hundreds of countless dollars so these are duplicate copies of the letters that go to clients confirming that the check is on the method I indicate you know if you simply 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 suggest it’s simply I suggest 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 verified 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 understand when you
get this you understand the check is opted for sure and that’s when they pay so they do not pay anything up until they in fact receive the cash 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 checking account and they can really rely on Wonder trust that the procedure has been finished and how many you think you have actually processed since you started this we have to do with 35 000 of these for
about 6 billion dollars wow so plainly they understand what they’re doing which’s what you need you need 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 speaking about something truly essential today the worker retention credit which most of you have actually never become aware of I certainly hadn’t become aware of it till very recently and found out a lot about it since this is most likely the most affordable expense of capital for any small company anywhere
anytime if you have workers between five and five hundred so I’ve got the expert 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 hard this isn’t like PPP we simply phone your bank manager and say provide me a loan it doesn’t 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 enjoy this program it’s going away very soon you got to learn all about it let’s talk worker retention credit Josh Fox what is an ERC let’s just start there so throughout 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 practically everyone it makes a big distinction right there 2 of them are loans and one’s a refund precisely so the ERC is a refund that’s.
fix the cash money payroll tax refund fine go on sorry I simply have to make certain we got that point I indicate that’s a huge difference a loan versus cash cash I like cash money 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 gorgeous tough check in the mail where you get actual money from the internal revenue service all right so let’s speak about how it works since 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 Assumption this money is not for the owner not for people on the cap table not for shareholders it’s for workers right you needed to have owned a company but it’s based upon you having W-2 employees 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 6 months of 2021 on the W-2 proper so there were 6 quarters the program was open well walk us through the six quarters so you had quarters two three and 4 of 2020 and you had quarters one 2 and three of 2021. okay so that’s how it’s determined 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 employee’s salary to a maximum of 5 thousand dollars per staff member for the year of 2020 and in 2021 the numbers escalated to 70 of the worker’s salary to a maximum of seven thousand per quarter how did that happen um they simply changed the rules in.
2021 versus since 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 as much as five 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 six thousand dollars per worker that is because that’s a great deal of cash it is now there’s a caution here the PPP money would need to be reduced 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 money somewhere around ten thousand dollars a person so let’s state hypothetically you owned a dining establishment in New york city 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 huge certainly now the big question is why does nobody learn about this due to the fact that appearance when I initially heard about this when I first satisfied Josh you know I’ve got great deals of investments in lots of business I’m a significant advocate for entrepreneurship in America and make numerous numerous investments in business owners of which numerous suffered through the pandemic when I initially became aware of 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 which were well should have and we utilized them wisely to stay alive throughout the pandemic so when I heard about this I said nah it can’t hold true however when I dug around I even contacted us to my politician pals Governor Senators they didn’t know about it I indicate that’s how you understand that’s how misinformation is that there’s no details out there then a lot of individuals told me well you can’t get it since you took the PPP also not real so let’s ask Josh why does no one learn about the worker retention credit you understand what’s fascinating you’re discussing the banks Kevin because in the PPP loan procedure 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 nation and they would process procedure 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 turmoil since remember in the initial cares act you might refrain from doing both programs so if you had done PPP you could not do 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 federal government never made it clear to anybody about how to.
do this does your CFO understand how to do this not truly she or he’s never ever done it before do the banks do it nope the banks don’t do it the payroll companies yeah some of them are doing it as a payroll business 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 actually been in business since 2009 and we’ve been working with the federal government and the state government to recuperate cash for Fortune 500 Fortune 1000 companies so a great deal of our huge big corporate clients have dealt with bottom line to recover other government programs we have actually done sales tax and utilize tax joblessness tax work opportunity tax credits research and development tax credits unclaimed property real estate tax all of these other government programs.
The employee retention tax credit is a broad based refundable tax credit designed to encourage.
companies to keep employees on their payroll. The credit is 50% of up to $10,000 in earnings paid by an.
employer whose organization is totally or partly suspended because of COVID-19 or whose gross receipts.
decrease by more than 50%.
1. The credit is readily available to all companies regardless of size including tax exempt companies. There are.
only 2 exceptions: (1) state and city governments and their instrumentalities and (2) small.
organizations who take Small Business Loans.
2. To certify, the employer has to satisfy one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the company’s company is totally or partially suspended by government order due to COVID-19.
during the calendar quarter or.
o the company’s gross receipts are listed below 50% of the equivalent quarter in 2019. Once the.
employer’s gross receipts go above 80% of an equivalent quarter in 2019 they no longer qualify.
after completion of that quarter.
Computation 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 before December 31, 2020.
The definition of qualifying earnings differs by whether an employer had, usually, more or less than.
100 employees in 2019.
Business that focus on ERC filing help normally provide proficiency and assistance to help services navigate the intricate process of claiming the credit. They can provide different services, consisting of:.
How is the employee retention credit calculated? How To File The Employee Retention Credit
Eligibility Assessment: These business will examine your business’s eligibility for the ERC based on aspects such as your market, earnings, and operations. If you satisfy the requirements for the credit and identify the maximum credit amount you can declare, they can help identify.
Paperwork and Computation: ERC filing services will help in gathering the required paperwork, such as payroll records and financial statements, to support your claim. They will likewise assist calculate the credit quantity based on qualified incomes and other qualifying expenses.
Retroactive Claim Review: If you are eligible to claim the ERC for previous quarters, these companies can review your past payroll records and financials to determine possible opportunities for retroactive credits. They can assist you modify prior tax returns to declare these refunds.
Filing Support: Business specializing in ERC filings will prepare and submit the essential kinds and paperwork on your behalf. This consists of finishing Form 941 or any other necessary tax return.
Compliance and Updates: ERC regulations and assistance have evolved over time. These business remain updated with the current changes and ensure that your filings abide by the most current standards. They can likewise supply continuous assistance if the internal revenue service requests extra information or performs an audit related to your ERC claim.
It is very important to research and veterinarian any company offering ERC filing support to guarantee their credibility and competence. Try to find recognized companies with experience in tax and payroll services, or think about reaching out to trusted accounting firms or tax experts who provide ERC submitting assistance.
Keep in mind that while these companies can offer valuable help, it’s always a great idea to have a basic understanding of the ERC requirements and process yourself. This will assist you make notified decisions and make sure accurate filings.
The Worker Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief measures. The goal of the ERC is to motivate services to retain and pay their staff members throughout the pandemic, even if their operations have 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 specific governmental entities. To certify, employers need to fulfill one of two requirements:.
The business operations were totally or partially suspended due to a government order related to COVID-19.
The business experienced a significant decline in gross receipts. As mentioned previously, for 2021, a significant decrease is defined as a 20% decrease in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a substantial decrease is defined as a 20% decline in gross invoices compared to the very same quarter in 2019, or a 20% decline in gross receipts compared to the instantly 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 (approximately 70%) of certified salaries paid to employees, consisting of particular health insurance 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: Initially, businesses that got a Paycheck Defense Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 allows businesses to claim the ERC even if they got a PPP loan. Nevertheless, the very same incomes can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively broadened and boosted, permitting eligible employers to declare the credit for certified earnings paid as far back as March 13, 2020. This retroactive arrangement supplies a chance for organizations to amend prior-year income tax return and receive refunds.
Claiming the Credit: Companies can claim the ERC by reporting it on their employment income tax return, normally Type 941. The excess can be refunded to the employer if the credit goes beyond the quantity of employment taxes owed.
It is necessary to keep in mind that the ERC provisions and eligibility criteria have actually progressed in time. The very best course of action is to talk to a tax professional or check out the official IRS site for the most current and in-depth information concerning the ERC, including any current legislative changes or updates.
To receive the ERC, a business should fulfill among the following requirements:.
The business operations were fully or partially suspended due to a government order related to COVID-19.
The business experienced a considerable decline in gross invoices. For 2021, a considerable decrease is defined as a 20% decrease in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a significant decline 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.
The ERC is readily available to services of all sizes, including tax-exempt companies, but there are some exceptions. For instance, federal government entities and businesses that got a PPP loan may have constraints on declaring the credit.
The process for declaring the ERC involves completing the necessary forms and including the credit on your employment income tax return (generally Form 941). The exact time it takes to process the credit can differ based on a number of aspects, consisting of the intricacy of your company and the work of the internal revenue service. It’s advised to consult with a tax professional for guidance particular to your circumstance.
There are a number of business that can aid with the process of declaring the ERC. These include accounting companies, tax advisory services, and payroll service providers. Some well-known companies that provide assistance with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s a good idea to research study and contact these companies directly to ask about their costs and services.
Please keep in mind that the info supplied here is based on general knowledge and might not reflect the most recent updates or changes to the ERC. It is very important to speak with a tax professional or check out the main IRS website for the most accurate and updated information regarding eligibility, claiming treatments, and offered help.
Less than 100. The credit is based if the company had 100 or less staff members on average in 2019.
on wages paid to all staff members whether they actually worked or not. To put it simply, even if the.
workers worked full-time and got paid for full time work, the employer still gets the credit.
Greater than 100. If the employer had more than 100 employees on average in 2019, then the credit is.
enabled just for salaries paid to workers who did not work during the calendar quarter.
In both cases, “salaries” includes not just cash payments however likewise a part of the expense of company.
supplied health care. How To File The Employee Retention Credit
Employers can be right away reimbursed for the credit by minimizing the amount of payroll taxes they.