Lets talk first about How To Receive Employee Retention Credit :
Our group here what do these guys doing everyone in this space is assisting teach people about ERC and uh always offer a gorgeous breakfast and have individuals truly find out about the program we must 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 hundreds of countless dollars actually 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 suggest you understand if you just begin to look at a few of these here I suggest this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I mean it’s simply I imply think about how many real customers that went through the program yeah this is the very end this is the party 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 customer so that’s how you’re able to track it you understand when you
get this you understand the check is chosen sure and that’s when they pay so they don’t pay anything till they actually receive the cash they don’t pay bottom line Wonder trust anything till this letter is confirmed the check is on the way they deposit it into their savings account and they can genuinely trust Wonder trust that the process has actually been finished and the number of you think you have actually processed considering that you started this we’re about 35 000 of these for
about 6 billion dollars wow so plainly they understand what they’re doing which’s what you need you require professionals 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 Fantastic here you’re at my YouTube channel we’re discussing something truly important today the staff member retention credit which the majority of you have actually never become aware of I certainly hadn’t heard of it till very just recently and discovered a lot about it since this is probably the most affordable expense of capital for any small business anywhere
anytime if you have workers in between 5 and five hundred so I’ve got the professional 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 call your bank manager and state offer me a loan it does not work there’s not a loan it’s an application and Josh is going to inform us all 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 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 developed 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 everybody it makes a big difference 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 all right go on sorry I simply have to ensure we got that point I mean that’s a huge difference a loan versus money cash I like money money that’s what we’re talking about okay 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 lovely hard check in the mail where you get real money from the IRS all right so let’s talk about how it works since it seems like to me if it’s a if it’s staff member retention credit that person had to be a worker so I’m going to make the Presumption this money is not for the owner not for people on the cap table not for shareholders it’s for employees right you needed to have owned a company however it’s based upon you having W-2 staff members in America not 10.99. As long as you had W-2 workers 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 appropriate so there were 6 quarters the program was open well walk us through the 6 quarters so you had quarters two three and 4 of 2020 and you had quarters one 2 and 3 of 2021. okay so that’s how it’s measured you have to be on the W-2 throughout that period now let’s talk my preferred part money just how much can you get back per employee that was on a W-2 in those six quarters so the calculation in 2020 to be precise Kevin is 50 of the worker’s wage to a maximum of five thousand dollars per worker for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the employee’s salary to a maximum of seven thousand per quarter how did that happen um they simply altered the rules in.
2021 versus because the turmoil 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 approximately five thousand Max and after that what takes place 21 000 Max in 2021 oh that’s how you develop twenty 6 thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty six thousand dollars per employee that is because that’s a lot of money it is now there’s a caution here the PPP cash 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 usually Kevin is if you took PPP money somewhere around 10 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 employees 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 question is why does nobody learn about this because appearance when I first found out about this when I initially fulfilled Josh you know I’ve got great deals of financial investments in great deals of business I’m a major advocate for entrepreneurship in America and make many many financial investments in entrepreneurs of which lots of suffered through the pandemic when I initially found out about this I called BS I don’t think it due to the fact that I use the PPP we went through the cash 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 been worthy of and we used them sensibly to stay alive throughout the pandemic so when I heard 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 suggest that’s how you understand that’s how misinformation is that there’s no information out there then a bunch of people informed me well you can’t get it since you took the PPP likewise not real so let’s ask Josh why does nobody understand about the worker retention credit you know what’s intriguing you’re speaking about the banks Kevin due to the fact that in the PPP loan process 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 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 process that’s all um and here there was mayhem since 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 initial program and when they changed the law in 2021 the banks were not doing ERC since it’s not alone so you’re getting a tax refund so the federal government never ever made it clear to anyone 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 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 done this prior to unless you have an account that went into this company and bottom line my firm Kevin has actually been in business considering that 2009 and we’ve been dealing with the federal government and the state government to recuperate money for Fortune 500 Fortune 1000 business so a lot of our big huge corporate clients have actually dealt with bottom line to recuperate other federal government programs we’ve done sales tax and utilize 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 designed to motivate.
companies to keep workers on their payroll. The credit is 50% of up to $10,000 in earnings paid by an.
company whose business is totally or partially suspended because of COVID-19 or whose gross receipts.
decrease by more than 50%.
Availability.
1. The credit is offered to all companies regardless of size consisting of tax exempt companies. There are.
only two exceptions: (1) state and local governments and their instrumentalities and (2) small.
companies who take Small Business Loans.
2. To certify, the company needs to meet one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the employer’s company is fully or partially suspended by government order due to COVID-19.
during the calendar quarter or.
o the company’s gross receipts are below 50% of the comparable quarter in 2019. Once the.
employer’s gross invoices exceed 80% of a similar quarter in 2019 they no longer qualify.
after completion of that quarter.
Computation of the Credit.
The amount of the credit is 50% of the certifying salaries paid up to $10,000 in total.
It works for wages paid after March 13th and before December 31, 2020.
The definition of certifying wages differs by whether an employer had, typically, more or less than.
100 workers in 2019.
Business that focus on ERC filing support generally provide expertise and assistance to assist services navigate the intricate procedure of claiming the credit. They can offer various services, including:.
How is the employee retention credit calculated? How To Receive Employee Retention Credit
Eligibility Assessment: These companies will examine your company’s eligibility for the ERC based on factors such as your industry, profits, and operations. They can assist identify if you satisfy the requirements for the credit and recognize the maximum credit quantity you can declare.
Documents and Computation: ERC filing services will assist in collecting the needed documents, such as payroll records and financial statements, to support your claim. They will also assist determine the credit amount based upon eligible incomes and other certifying expenditures.
Retroactive Claim Review: If you are qualified to claim the ERC for prior quarters, these business can evaluate your previous payroll records and financials to identify possible opportunities for retroactive credits. They can assist you change previous tax returns to declare these refunds.
Filing Support: Business focusing on ERC filings will prepare and send the essential types and paperwork in your place. This includes completing Type 941 or any other required tax return.
Compliance and Updates: ERC guidelines and assistance have evolved in time. These companies stay updated with the current modifications and ensure that your filings adhere to the most present standards. They can likewise supply continuous support if the IRS demands additional information or performs an audit related to your ERC claim.
It is essential to research and veterinarian any company using ERC filing assistance to ensure their credibility and proficiency. Try to find established companies with experience in tax and payroll services, or consider reaching out to trusted accounting firms or tax specialists who offer ERC filing assistance.
Bear in mind that while these companies can supply valuable help, it’s constantly a good concept to have a fundamental understanding of the ERC requirements and process yourself. This will help you make notified decisions and ensure accurate filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief measures. The objective of the ERC is to encourage businesses to keep and pay their workers throughout the pandemic, even if their operations have been affected.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is available to qualified companies, including for-profit companies, tax-exempt organizations, and specific governmental entities. To certify, companies must satisfy one of two requirements:.
Business operations were fully or partially suspended due to a government order related to COVID-19.
The business experienced a considerable decrease in gross invoices. As mentioned earlier, for 2021, a substantial decrease is defined as a 20% decline in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a significant decrease is defined as a 20% decrease in gross receipts compared to the same quarter in 2019, or a 20% decrease in gross invoices compared to the immediately preceding quarter.
Credit Amount: The ERC is a refundable tax credit that offsets the employer’s share of Social Security taxes. The credit quantity is equal to a percentage (approximately 70%) of qualified salaries paid to workers, consisting of specific 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: At first, businesses that got an Income Protection Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 permits services to claim the ERC even if they received a PPP loan. However, the very same earnings can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively expanded and improved, permitting qualified companies to declare the credit for certified earnings paid as far back as March 13, 2020. This retroactive arrangement offers a chance for companies to amend prior-year income tax return and receive refunds.
Declaring the Credit: Employers can declare the ERC by reporting it on their employment tax returns, usually Kind 941. The excess can be refunded to the company if the credit exceeds the amount of work taxes owed.
It is essential to note that the ERC provisions and eligibility criteria have actually progressed gradually. The very best course of action is to talk to a tax expert or visit the official internal revenue service website for the most comprehensive and updated details concerning the ERC, including any recent legislative modifications or updates.
To qualify for the ERC, an organization must fulfill one of the following requirements:.
The business operations were completely or partly suspended due to a government order related to COVID-19.
The business experienced a considerable decline in gross invoices. For 2021, a substantial decrease is defined as a 20% decline 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 very same quarter in 2019, or a 20% decline in gross receipts compared to the instantly preceding quarter.
The ERC is readily available to organizations of all sizes, including tax-exempt organizations, however there are some exceptions. Government entities and organizations that received a PPP loan might have limitations on claiming the credit.
The process for declaring the ERC involves finishing the needed kinds and consisting of the credit on your work tax return (normally Form 941). The exact time it takes to process the credit can differ based upon numerous elements, consisting of the intricacy of your service and the work of the internal revenue service. It’s suggested to seek advice from a tax professional for guidance specific to your scenario.
There are a number of companies that can help with the process of claiming the ERC. These include accounting firms, tax advisory services, and payroll company. Some popular companies that provide help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s advisable to research study and get in touch with these business directly to inquire about their costs and services.
Please note that the info offered here is based on basic knowledge and might not show the most recent updates or changes to the ERC. It is essential to talk to a tax professional or visit the main internal revenue service website for the most precise and current info relating to eligibility, claiming treatments, and offered help.
Less than 100. The credit is based if the company had 100 or fewer workers on average in 2019.
on incomes paid to all workers whether they in fact 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. If the company had more than 100 staff members usually in 2019, then the credit is.
allowed just for incomes paid to workers who did not work throughout the calendar quarter.
In both cases, “salaries” includes not just money payments but also a portion of the cost of company.
provided health care. How To Receive Employee Retention Credit
Payment.
Employers can be instantly repaid for the credit by lowering the amount of payroll taxes they.