Lets talk first about Pandemic Employee Retention Credit :
Our team here what do these guys doing everybody in this room is assisting teach individuals about ERC and uh constantly provide a stunning breakfast and have people truly learn more about the program we need to head to the room where we are able to display a few of the checks that we are getting for companies and I wish to see that what is this this is uh hundreds of countless dollars literally Kevin hundreds of millions of dollars so these are duplicate copies of the letters that go to clients validating that the check is on the way I suggest you know if you simply start to take a 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 mean it’s simply I mean think of the number of actual customers 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 consumer so that’s how you have the ability to track it you know when you
receive this you understand the check is gone 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 up until this letter is confirmed the check is on the method they deposit it into their bank account and they can genuinely rely on Wonder trust that the process has been completed and the number of you think you’ve processed since you began this we have to do with 35 000 of these for
about 6 billion dollars wow so clearly they know what they’re doing which’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 actually crucial today the employee retention credit which most of you have never ever become aware of I definitely had not become aware of it until extremely recently and found out a lot about it due to the fact that this is most likely the lowest cost of capital for any small business anywhere
anytime if you have employees in between five 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 biggest processor of these ERC credits this is a 170 page program so it’s not easy this isn’t like PPP we simply contact your bank manager and state provide 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 have actually become yes the Ambassador and paid representative for this I enjoy this program it’s going away very soon you got to learn 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 came up with the cares Act and the cares act provided companies 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 big distinction right there 2 of them are loans and one’s a refund precisely so the ERC is a refund that’s.
correct the money money payroll tax refund okay go on sorry I simply have to make certain we got that point I mean that’s a big distinction a loan versus money money 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 beautiful tough check in the mail where you get real money from the IRS all right so let’s speak about how it works due to the fact that it sounds 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 individuals on the cap table not for shareholders it’s for employees right you had to have actually owned an organization however it’s based upon you having W-2 staff members in America not 10.99. so as long as you had W-2 employees 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 need 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 6 quarters so you had quarters two three and 4 of 2020 and you had quarters one two and 3 of 2021. okay 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 cash how much can you get back per employee that was on a W-2 in those 6 quarters so the estimation in 2020 to be specific Kevin is 50 of the worker’s wage to a maximum of five thousand dollars per staff member for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the worker’s salary to an optimum of seven thousand per quarter how did that happen um they just changed the rules in.
2021 versus because the turmoil of the pandemic so they wished to even get more to keep those workers 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 then what occurs 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 6 thousand dollars per employee that is since that’s a lot of cash it is now there’s a caution here the PPP cash would need to be reduced from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan two you would lower the 26 000 so what we’re seeing on average Kevin is if you took PPP money someplace around 10 thousand dollars a person so let’s say hypothetically you owned a restaurant in New York 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 internal revenue service so it’s substantial clearly now the big question is why does no one understand about this due to the fact that look when I first found out about this when I first met Josh you understand I’ve got lots of investments in great deals of companies I’m a major supporter for entrepreneurship in America and make many numerous financial investments in entrepreneurs of which lots of suffered through the pandemic when I first found out about this I called BS I do not think it because I use 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 deserved and we used them carefully to survive during the pandemic so when I heard about this I stated nah it can’t be true but when I dug around I even called to my politician friends Governor Senators they didn’t understand about it I mean that’s how you know that’s how false information is that there’s no information out there then a bunch of people 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 understand about the staff member retention credit you understand what’s intriguing you’re speaking about the banks Kevin because in the PPP loan process 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 huge 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 simply procedure process that’s all um and here there was chaos due to the fact that keep in mind in the original cares act you could not do both programs so if you had actually 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 federal government never ever made it clear to anyone about how to.
do this does your CFO understand how to do this not actually he or she’s never ever 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 company your accounting professional no your accounting professional’s never ever done this prior to unless you have an account that went into this service and bottom line my company Kevin has stayed in business considering that 2009 and we’ve been working with the federal government and the state federal government to recover cash for Fortune 500 Fortune 1000 business so a lot of our big huge corporate customers have worked with bottom line to recover other federal government programs we’ve done sales tax and use tax unemployment 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 created to encourage.
employers to keep employees on their payroll. The credit is 50% of up to $10,000 in salaries paid by an.
Because of COVID-19 or whose gross invoices, company whose organization is totally or partly suspended.
decrease by more than 50%.
Accessibility.
1. The credit is available to all companies regardless of size including tax exempt organizations. There are.
just 2 exceptions: (1) state and local governments and their instrumentalities and (2) small.
companies 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 organization is totally or partially suspended by government order due to COVID-19.
throughout the calendar quarter or.
o the employer’s gross invoices are listed below 50% of the comparable quarter in 2019. When the.
company’s gross invoices exceed 80% of a comparable quarter in 2019 they no longer qualify.
after the end of that quarter.
Computation of the Credit.
The amount of the credit is 50% of the certifying incomes paid up to $10,000 in total.
It works for earnings paid after March 13th and before December 31, 2020.
The definition of certifying earnings differs by whether a company had, on average, more or less than.
100 employees in 2019.
Business that specialize in ERC filing assistance normally provide competence and support to help businesses browse the complex process of claiming the credit. They can offer various services, consisting of:.
How is the employee retention credit calculated? Pandemic Employee Retention Credit
Eligibility Assessment: These business will evaluate your service’s eligibility for the ERC based on aspects such as your market, profits, and operations. If you satisfy the requirements for the credit and identify the optimum credit amount you can claim, they can assist determine.
Documentation and Computation: ERC filing services will assist in gathering the required documentation, such as payroll records and monetary statements, to support your claim. They will likewise help compute the credit amount based upon qualified wages and other qualifying expenditures.
Retroactive Claim Review: If you are eligible to declare the ERC for previous quarters, these business can examine your past payroll records and financials to determine possible chances for retroactive credits. They can assist you amend previous tax returns to claim these refunds.
Filing Support: Companies concentrating on ERC filings will prepare and send the essential forms and paperwork in your place. This consists of completing Form 941 or any other necessary tax return.
Compliance and Updates: ERC regulations and assistance have developed over time. These business stay upgraded with the most recent changes and guarantee that your filings abide by the most present standards. They can likewise supply ongoing assistance if the internal revenue service demands additional information or conducts an audit related to your ERC claim.
It is essential to research and veterinarian any company offering ERC filing assistance to guarantee their trustworthiness and competence. Look for recognized companies with experience in tax and payroll services, or think about connecting to trusted accounting companies or tax professionals who use ERC submitting support.
Bear in mind that while these companies can supply important assistance, it’s always a great concept to have a standard understanding of the ERC requirements and process yourself. This will help you make informed choices and make sure accurate filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit presented by the U.S. government as part of COVID-19 relief steps. The objective of the ERC is to encourage organizations to maintain and pay their employees during the pandemic, even if their operations have actually been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is available to qualified companies, including for-profit services, tax-exempt organizations, and certain governmental entities. To qualify, employers need to fulfill one of two requirements:.
Business operations were fully or partially suspended due to a federal government order related to COVID-19.
The business experienced a substantial decrease in gross invoices. As pointed out earlier, for 2021, a considerable decline is defined as a 20% decrease in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a substantial decrease is defined as a 20% decline in gross receipts compared to the exact 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 amounts to a percentage (approximately 70%) of qualified wages paid to employees, including certain health insurance costs. The maximum credit per staff member is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: At first, services that received a Paycheck Security Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 enables services to claim the ERC even if they got a PPP loan. The same earnings can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively broadened and enhanced, enabling eligible employers to claim the credit for certified earnings paid as far back as March 13, 2020. This retroactive provision provides an opportunity for organizations to change prior-year income tax return and receive refunds.
Declaring the Credit: Employers can claim the ERC by reporting it on their employment tax returns, normally Kind 941. If the credit surpasses the amount of employment taxes owed, the excess can be reimbursed to the employer.
It’s important to note that the ERC provisions and eligibility criteria have actually developed over time. The best course of action is to speak with a tax professional or go to the main internal revenue service website for the most up-to-date and in-depth info relating to the ERC, including any recent legal modifications or updates.
To get approved for the ERC, a company must satisfy one of the following criteria:.
Business operations were completely or partly suspended due to a government order related to COVID-19.
Business experienced a substantial decrease in gross invoices. For 2021, a significant decrease is specified as a 20% decline in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a substantial decrease is defined as a 20% decline in gross receipts compared to the very same quarter in 2019, or a 20% decrease in gross receipts compared to the instantly preceding quarter.
The ERC is 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 restrictions on claiming the credit.
The procedure for declaring the ERC includes completing the required types and including the credit on your work income tax return (normally Form 941). The exact time it takes to process the credit can differ based on numerous elements, consisting of the complexity of your service and the work of the IRS. It’s recommended to speak with a tax professional for guidance specific to your scenario.
There are several companies that can help with the procedure of declaring the ERC. These consist of accounting companies, tax advisory services, and payroll provider. Some well-known business that use support with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s recommended to research study and get in touch with these companies straight to inquire about their fees and services.
Please keep in mind that the details provided here is based upon general understanding and might not show the most recent updates or modifications to the ERC. It’s important to speak with a tax expert or go to the official internal revenue service website for the most up-to-date and accurate information relating to eligibility, claiming procedures, and offered help.
Less than 100. The credit is based if the company had 100 or fewer workers on average in 2019.
on wages paid to all staff members whether they really worked or not. In other words, 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 staff members usually in 2019, then the credit is.
allowed only for earnings paid to workers who did not work throughout the calendar quarter.
In both cases, “salaries” consists of not just money payments but likewise a portion of the expense of company.
offered healthcare. Pandemic Employee Retention Credit
Payment.
Companies can be immediately compensated for the credit by minimizing the quantity of payroll taxes they.