Lets talk first about Hurricane Employee Retention Credit :
Our group here what do these guys doing everybody in this space is assisting teach individuals about ERC and uh always supply a gorgeous breakfast and have individuals truly learn about the program we must head to the space 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 numerous millions of dollars literally Kevin numerous millions of dollars so these are replicate copies of the letters that go to customers verifying that the check is on the way I mean you understand if you just start to take a look at some of these here I suggest this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I suggest it’s just I suggest think about the number of real clients that went through the program yeah this is the very end this is the party at the end when the check is confirmed the numbers are verified and the check is on the mail in the mail from the IRS heading to the client so that’s how you’re able to track it you understand when you
get this you know the check is chosen sure which’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 up until this letter is verified the check is on the method they deposit it into their bank account and they can genuinely trust Wonder trust that the process has been finished and how many you believe you’ve processed since you began this we’re about 35 000 of these for
about 6 billion dollars wow so clearly they know what they’re doing which’s what you require you need 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 talking about something really essential today the worker retention credit which most of you have actually never heard of I definitely had not become aware of it until extremely just recently and found out a lot about it because this is probably the most affordable cost of capital for any small company anywhere
anytime if you have staff members between 5 and five hundred so I’ve got the expert with me this is Josh Fox he’s the creator and CEO of bottom line Ideas they’re the biggest processor of these ERC credits this is a 170 page program so it’s challenging this isn’t like PPP we simply contact your bank manager and say give me a loan it does not 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 become yes the Ambassador and paid representative for this I enjoy this program it’s going away soon you got to discover all about it let’s talk staff member retention credit Josh Fox what is an ERC let’s just begin there so throughout the Trump Administration when President Trump was enacted they created the cares Act and the cares act provided services three chances 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 precisely so the ERC is a refund that’s.
correct the cash money payroll tax refund fine go on sorry I just have to make sure we got that point I indicate that’s a big difference a loan versus cash cash I like money money that’s what we’re talking about alright 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 hard check in the mail where you get real cash from the internal revenue service all right so let’s talk about how it works because it sounds like to me if it’s a if it’s staff member retention credit that individual needed to be a staff member so I’m going to make the Assumption this cash is not for the owner not for individuals on the cap table not for investors it’s for workers right you had to have actually owned an organization however it’s based upon you having W-2 workers 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 eligible so you have to be on payroll in 2020 on the W-2 and you have to be on payroll for the first six months of 2021 on the W-2 right so there were 6 quarters the program was open well stroll us through the 6 quarters so you had quarters two 3 and four of 2020 and you had quarters one two and three 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 cash just how much can you get back per employee that was on a W-2 in those 6 quarters so the calculation in 2020 to be precise Kevin is 50 of the employee’s salary to a maximum of five thousand dollars per employee for the year of 2020 and in 2021 the numbers escalated to 70 of the staff member’s income to an optimum of 7 thousand per quarter how did that occur um they simply changed the rules in.
2021 versus due to the fact that 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 up to 5 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 since that’s a great deal of money it is now there’s a caveat here the PPP cash would need to be decreased from the twenty six thousand dollars so if you took PPP loan one and PPP loan 2 you would lower the 26 000 so what we’re seeing usually Kevin is if you took PPP cash somewhere around 10 thousand dollars an individual 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 money you would still get a million dollar in the mail from the IRS so it’s huge obviously now the huge question is why does nobody know about this since look when I first heard about this when I first satisfied Josh you know I have actually got great deals of investments in lots of companies I’m a significant supporter for entrepreneurship in America and make many numerous investments in entrepreneurs of which many suffered through the pandemic when I initially became aware of this I called BS I don’t think it because I utilize 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 which were well been worthy of and we utilized them sensibly to survive 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 political leader pals Guv Senators they didn’t learn about it I suggest that’s how you understand 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 nobody know about the staff member retention credit you understand what’s interesting you’re talking about the banks Kevin since in the PPP loan process the federal government made it really 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 process 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 mayhem due to the fact that 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 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 federal government never made it clear to anyone about how to.
do this does your CFO know how to do this not really she or he’s never done it previously do the banks do it nope the banks don’t do it the payroll business yeah a few of them are doing it as a payroll business your accountant no your accounting professional’s never ever done this prior to unless you have an account that entered into this service and bottom line my firm Kevin has stayed in business considering that 2009 and we’ve been dealing with the federal government and the state federal government to recover cash for Fortune 500 Fortune 1000 business so a great deal of our big huge corporate clients have dealt with bottom line to recover other federal 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 staff member retention tax credit is a broad based refundable tax credit developed to motivate.
employers to keep staff members on their payroll. The credit is 50% of approximately $10,000 in wages paid by an.
Due to the fact that of COVID-19 or whose gross receipts, employer whose business is fully or partially suspended.
decline by more than 50%.
1. The credit is offered to all companies despite size consisting of tax exempt organizations. There are.
only 2 exceptions: (1) state and local governments and their instrumentalities and (2) little.
businesses who take Small Business Loans.
2. To certify, the employer has to fulfill one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the company’s service is completely or partly suspended by government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross invoices are below 50% of the equivalent quarter in 2019. As soon as the.
company’s gross invoices go above 80% of an equivalent quarter in 2019 they no longer qualify.
after completion of that quarter.
Estimation of the Credit.
The quantity of the credit is 50% of the qualifying salaries paid up to $10,000 in overall.
It works for wages paid after March 13th and prior to December 31, 2020.
The meaning of certifying wages differs by whether a company had, typically, basically than.
100 employees in 2019.
Business that specialize in ERC filing assistance usually supply proficiency and assistance to assist organizations browse the complex procedure of declaring the credit. They can offer numerous services, consisting of:.
How is the employee retention credit calculated? Hurricane Employee Retention Credit
Eligibility Evaluation: These business will examine your business’s eligibility for the ERC based upon aspects such as your industry, income, and operations. They can help figure out if you fulfill the requirements for the credit and identify the maximum credit amount you can declare.
Paperwork and Calculation: ERC filing services will assist in gathering the required paperwork, such as payroll records and monetary statements, to support your claim. They will also assist compute the credit amount based upon qualified wages and other qualifying expenses.
Retroactive Claim Evaluation: If you are eligible to claim the ERC for previous quarters, these business can examine your previous payroll records and financials to identify prospective chances for retroactive credits. They can help you modify previous income tax return to declare these refunds.
Filing Support: Business concentrating on ERC filings will prepare and send the needed kinds and paperwork on your behalf. This consists of finishing Form 941 or any other necessary tax forms.
Compliance and Updates: ERC guidelines and guidance have developed gradually. These companies stay updated with the latest changes and ensure that your filings comply with the most present standards. If the IRS requests extra info or carries out an audit associated to your ERC claim, they can likewise offer continuous support.
It is very important to research study and veterinarian any company providing ERC filing support to guarantee their credibility and knowledge. Search for recognized firms with experience in tax and payroll services, or consider connecting to relied on accounting companies or tax experts who provide ERC submitting support.
Bear in mind that while these companies can supply important assistance, it’s always a good idea to have a basic understanding of the ERC requirements and procedure yourself. This will help you make informed choices and guarantee precise 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 goal of the ERC is to encourage organizations to maintain and pay their employees throughout the pandemic, even if their operations have actually been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is readily available to eligible companies, consisting of for-profit businesses, tax-exempt organizations, and particular governmental entities. To certify, companies need to meet one of two criteria:.
Business operations were completely or partially suspended due to a government order related to COVID-19.
Business experienced a significant decrease in gross invoices. As discussed previously, for 2021, a significant decrease is specified as a 20% decline in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a substantial decline is specified as a 20% decrease in gross invoices compared to the same quarter in 2019, or a 20% decrease 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 is equal to a percentage (approximately 70%) of qualified incomes paid to staff members, consisting of certain health plan costs. The optimum credit per worker 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 Defense Program (PPP) loan were not qualified for the ERC. However, legislation passed in late 2020 and extended in 2021 allows companies to declare the ERC even if they received a PPP loan. However, the same wages can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has actually been retroactively broadened and boosted, allowing qualified employers to declare the credit for certified wages paid as far back as March 13, 2020. This retroactive arrangement provides a chance for businesses to modify prior-year tax returns and get refunds.
Declaring the Credit: Employers can declare the ERC by reporting it on their work tax returns, generally Kind 941. If the credit exceeds the amount of employment taxes owed, the excess can be refunded to the employer.
It is very important to keep in mind that the ERC arrangements and eligibility requirements have actually progressed with time. The very best course of action is to consult with a tax professional or visit the official internal revenue service site for the most up-to-date and in-depth info regarding the ERC, including any current legislative changes or updates.
To qualify for the ERC, a company must meet one of the following requirements:.
Business operations were totally or partly suspended due to a government order related to COVID-19.
The business experienced a significant decrease 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 substantial decline is specified as a 20% decline in gross receipts compared to the same quarter in 2019, or a 20% decline in gross receipts compared to the right away preceding quarter.
The ERC is offered to companies of all sizes, including tax-exempt organizations, however there are some exceptions. Federal government entities and businesses that received a PPP loan may have constraints on claiming the credit.
The procedure for declaring the ERC involves completing the needed kinds and consisting of the credit on your employment tax return (usually Type 941). The exact time it requires to process the credit can differ based upon numerous elements, consisting of the complexity of your organization and the workload of the IRS. It’s advised to speak with a tax professional for guidance specific to your circumstance.
There are a number of business that can assist with the process of claiming the ERC. Some well-known companies that use help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the information provided here is based on general understanding and may not show the most current updates or modifications to the ERC. It is essential to talk to a tax expert or visit the main internal revenue service site for the most current and accurate information regarding eligibility, claiming procedures, and offered assistance.
Less than 100. The credit is based if the employer had 100 or fewer employees on average in 2019.
on wages paid to all employees whether they in fact worked or not. To put it simply, even if the.
staff members worked full-time and got paid 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.
permitted only for wages paid to staff members who did not work throughout the calendar quarter.
In both cases, “incomes” consists of not just cash payments but also a part of the expense of company.
offered health care. Hurricane Employee Retention Credit
Employers can be immediately reimbursed for the credit by reducing the quantity of payroll taxes they.