Lets talk first about Limited Commerce Employee Retention Credit :
Our group here what do these people doing everybody in this room is helping teach individuals about ERC and uh always provide a gorgeous breakfast and have people really discover the program we ought to head to the space where we have the ability to display some of the checks that we are getting for companies and I ‘d like to see that what is this this is uh numerous millions of dollars actually Kevin numerous millions of dollars so these are duplicate copies of the letters that go to clients verifying that the check is on the way I suggest you understand if you just 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 mean it’s just I suggest consider how many actual customers 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 verified and the check is on the mail in the mail from the internal revenue service heading to the consumer so that’s how you’re able to track it you understand when you
get this you know the check is opted for sure which’s when they pay so they don’t pay anything till they actually get the money they don’t pay bottom line Wonder trust anything until this letter is validated the check is on the way they deposit it into their bank account and they can really trust Wonder trust that the procedure has been finished and the number of you believe you have actually processed considering that you started this we have to do with 35 000 of these for
about six billion dollars wow so clearly they understand what they’re doing which’s what you require 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 speaking about something actually crucial today the staff member retention credit which most of you have actually never become aware of I definitely hadn’t heard of it until extremely just recently and learned a lot about it since this is most likely 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 creator and CEO of bottom line Principles they’re the largest processor of these ERC credits this is a 170 page program so it’s not easy this isn’t like PPP we simply call your bank manager and say 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 have actually become yes the Ambassador and paid representative for this I love 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 simply start there so throughout the Trump Administration when President Trump was enacted they created the cares Act and the cares act used companies three opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically everybody it makes a huge difference right there 2 of them are loans and one’s a refund precisely so the ERC is a refund that’s.
correct the money cash payroll tax refund alright go on sorry I just have to ensure we got that point I suggest that’s a big distinction a loan versus money cash I like cash cash 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 stunning hard check in the mail where you get actual cash from the internal revenue service all right so let’s speak about how it works because it seems like to me if it’s a if it’s worker retention credit that person had to be an employee so I’m going to make the Presumption this cash is not for the owner not for people on the cap table not for shareholders it’s for workers right you had to have actually owned a service but it’s based upon you having W-2 staff members 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 very first 6 months of 2021 on the W-2 proper so there were 6 quarters the program was open well stroll us through the 6 quarters so you had quarters two three and 4 of 2020 and you had quarters one two and 3 of 2021. alright so that’s how it’s determined you need to be on the W-2 throughout that period now let’s talk my favorite part money how much can you return per worker that was on a W-2 in those 6 quarters so the computation in 2020 to be exact Kevin is 50 of the employee’s income to a maximum of 5 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 just changed the rules in.
2021 versus since the mayhem 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 up to 5 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 five thousand in twenty twenty that’s twenty six thousand dollars per worker that is since that’s a lot of cash it is now there’s a caveat here the PPP money would have to be lowered 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 someplace around ten thousand dollars an individual 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 IRS so it’s substantial clearly now the big concern is why does nobody learn about this since appearance when I first found out about this when I initially fulfilled Josh you know I’ve got lots of financial investments in great deals of companies I’m a major advocate for entrepreneurship in America and make many lots of investments in business owners of which many suffered through the pandemic when I initially heard about this I called BS I don’t believe it since 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 and that were well been worthy of and we utilized them sensibly to survive during the pandemic so when I heard about this I stated nah it can’t hold true however when I dug around I even called to my politician buddies Guv Senators they didn’t know about it I imply 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 because you took the PPP likewise not real so let’s ask Josh why does nobody learn about the worker retention credit you know what’s interesting you’re talking about the banks Kevin due to the fact that in the PPP loan process the federal government made it extremely clear that if you desired 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 simply procedure procedure that’s all um and here there was turmoil because remember in the original cares act you might not do both programs so if you had done PPP you could not do ERC in the original program and when they altered the law in 2021 the banks were refraining from doing ERC due to the fact that it’s not alone so you’re getting a tax refund so the federal government never ever made it clear to any person about how to.
do this does your CFO know how to do this not really he or she’s never ever done it before do the banks do it nope the banks don’t do it the payroll companies yeah a few of them are doing it as a payroll company your accountant no your accounting professional’s never done this before unless you have an account that went into this organization and bottom line my company Kevin has actually stayed in business given that 2009 and we have actually been working with the federal government and the state government to recuperate money for Fortune 500 Fortune 1000 business so a lot of our huge big corporate clients have actually dealt with bottom line to recuperate other government programs we have actually done sales tax and utilize tax unemployment tax work opportunity tax credits research and development tax credits unclaimed home property tax all of these other federal government programs.
The employee retention tax credit is a broad based refundable tax credit created to encourage.
employers to keep staff members on their payroll. The credit is 50% of up to $10,000 in earnings paid by an.
Due to the fact that of COVID-19 or whose gross receipts, company whose business is totally or partly suspended.
decrease by more than 50%.
1. The credit is offered to all companies no matter size consisting of tax exempt organizations. There are.
only two exceptions: (1) state and local governments and their instrumentalities and (2) little.
services who take Small Business Loans.
2. To qualify, the company has to fulfill one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the company’s company is fully or partially suspended by federal 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. When the.
employer’s gross receipts go above 80% of a similar quarter in 2019 they no longer certify.
after completion 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 salaries paid after March 13th and before December 31, 2020.
The definition of certifying earnings varies by whether a company had, typically, more or less than.
100 staff members in 2019.
Business that focus on ERC filing assistance generally offer competence and support to assist companies browse the intricate process of declaring the credit. They can offer different services, including:.
How is the employee retention credit calculated? Limited Commerce Employee Retention Credit
Eligibility Assessment: These business will assess your business’s eligibility for the ERC based on elements such as your industry, profits, and operations. They can help identify if you satisfy the requirements for the credit and determine the maximum credit amount you can declare.
Documentation and Estimation: ERC filing services will help in collecting the essential paperwork, such as payroll records and financial declarations, to support your claim. They will likewise assist determine the credit quantity based on eligible salaries and other qualifying costs.
Retroactive Claim Review: If you are qualified to claim the ERC for previous quarters, these business can evaluate your previous payroll records and financials to identify potential chances for retroactive credits. They can assist you modify previous tax returns to claim these refunds.
Filing Help: Business focusing on ERC filings will prepare and send the essential types and paperwork on your behalf. This consists of completing Form 941 or any other necessary tax forms.
Compliance and Updates: ERC regulations and guidance have actually developed over time. These companies remain updated with the latest changes and guarantee that your filings adhere to the most existing standards. If the IRS requests additional info or performs an audit related to your ERC claim, they can also supply ongoing assistance.
It is essential to research study and vet any company providing ERC filing assistance to guarantee their credibility and know-how. Search for recognized firms with experience in tax and payroll services, or think about connecting to relied on accounting firms or tax specialists who offer ERC submitting assistance.
Remember that while these business can offer important assistance, it’s always a good idea to have a standard understanding of the ERC requirements and process yourself. This will assist you make notified decisions and guarantee precise filings.
The Worker Retention Credit (ERC) is a refundable tax credit presented by the U.S. federal government as part of COVID-19 relief measures. The goal of the ERC is to encourage companies to maintain and pay their workers during the pandemic, even if their operations have actually been impacted.
Here are some key points about the ERC:.
Eligibility: The ERC is offered to qualified employers, consisting of for-profit services, tax-exempt organizations, and certain governmental entities. To qualify, companies need to satisfy one of two requirements:.
The business operations were totally or partially suspended due to a government order related to COVID-19.
Business experienced a significant decrease in gross receipts. As pointed out earlier, for 2021, a substantial decline is specified as a 20% decrease in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a substantial decline is specified as a 20% decrease 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 company’s share of Social Security taxes. The credit amount is equal to a percentage (as much as 70%) of qualified incomes paid to staff members, including particular health insurance costs. The maximum 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 received an Income Protection 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 got a PPP loan. The very same incomes can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively expanded and boosted, enabling qualified companies to claim the credit for certified wages paid as far back as March 13, 2020. This retroactive arrangement offers an opportunity for organizations to change prior-year income tax return and get refunds.
Claiming the Credit: Employers can declare the ERC by reporting it on their employment tax returns, normally Form 941. The excess can be reimbursed to the employer if the credit surpasses the amount of work taxes owed.
It is very important to keep in mind that the ERC arrangements and eligibility requirements have developed gradually. The very best course of action is to seek advice from a tax expert or visit the main internal revenue service site for the most in-depth and updated details relating to the ERC, consisting of any recent legislative changes or updates.
To receive the ERC, a company must fulfill among the following criteria:.
Business operations were completely or partly suspended due to a federal government order related to COVID-19.
Business experienced a considerable decline in gross receipts. For 2021, a considerable decrease is specified as a 20% decline in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a significant decline is specified as a 20% decline in gross invoices compared to the same quarter in 2019, or a 20% decrease in gross receipts compared to the immediately preceding quarter.
The ERC is available to organizations of all sizes, including tax-exempt organizations, but there are some exceptions. For instance, government entities and services that got a PPP loan may have limitations on claiming the credit.
The process for claiming the ERC includes completing the required kinds and including the credit on your work income tax return (typically Type 941). The exact time it requires to process the credit can vary based on several factors, consisting of the intricacy of your service and the work of the internal revenue service. It’s recommended to speak with a tax expert for guidance specific to your scenario.
There are a number of business that can help with the procedure of declaring the ERC. Some popular business that use help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the info provided here is based upon general knowledge and might not reflect the most current updates or modifications to the ERC. It’s important to seek advice from a tax expert or check out the main IRS site for the most accurate and up-to-date info regarding eligibility, declaring treatments, and offered support.
Less than 100. The credit is based if the employer had 100 or less staff members on average in 2019.
on salaries paid to all workers whether they in fact worked or not. Simply put, even if the.
employees worked full time and made money for full time work, the employer still gets the credit.
Greater than 100. If the employer had more than 100 workers usually in 2019, then the credit is.
permitted just for incomes paid to employees who did not work throughout the calendar quarter.
In both cases, “salaries” consists of not simply money payments but also a portion of the cost of company.
offered healthcare. Limited Commerce Employee Retention Credit
Employers can be instantly reimbursed for the credit by minimizing the amount of payroll taxes they.