Lets talk first about Ppp Loan And Employee Retention Credit :
Our team here what do these people doing everyone in this room is helping teach people about ERC and uh constantly provide a gorgeous breakfast and have individuals truly learn more about the program we should head to the space where we have the ability to display some of the checks that we are getting for business and I ‘d like to see that what is this this is uh hundreds of countless dollars literally Kevin hundreds of countless dollars so these are replicate copies of the letters that go to clients verifying that the check is on the way I indicate you know if you just begin to take a 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 just I suggest think about how many 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 internal revenue service heading to the customer so that’s how you’re able to track it you know when you
get this you understand the check is chosen sure which’s when they pay so they do not pay anything until they really receive the money they do not pay bottom line Wonder trust anything until this letter is confirmed the check is on the way they transfer it into their bank account and they can truly rely on Wonder trust that the procedure has actually been completed and the number of you believe you’ve processed given that you started this we have to do with 35 000 of these for
about 6 billion dollars wow so plainly they know what they’re doing and that’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 Terrific here you’re at my YouTube channel we’re speaking about something truly essential today the employee retention credit which the majority of you have actually never ever become aware of I certainly had not heard of it till extremely just recently and discovered a lot about it because this is probably the most affordable cost of capital for any small company anywhere
anytime if you have employees between five and five hundred so I have actually got the professional with me this is Josh Fox he’s the creator and CEO of bottom line Concepts 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 just 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 us all about it and how to get it and why I have actually become yes the Ambassador and paid spokesperson for this I enjoy this program it’s disappearing soon you got to find out everything about it let’s talk worker retention credit Josh Fox what is an ERC let’s just start there so during the Trump Administration when President Trump was enacted they created the cares Act and the cares act used businesses 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 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 alright go on sorry I simply have to make sure we got that point I imply that’s a big difference a loan versus money money I like money cash that’s what we’re discussing all right 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 lovely difficult check in the mail where you get real money from the IRS all right so let’s talk about how it works because it sounds like to me if it’s a if it’s worker 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 service however it’s based on you having W-2 workers 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 need 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 stroll us through the 6 quarters so you had quarters two three and 4 of 2020 and you had quarters one two and three of 2021. okay so that’s how it’s measured you need to be on the W-2 during that duration now let’s talk my favorite part cash how much can you return 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 an optimum of 5 thousand dollars per staff member for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the employee’s wage to an optimum of seven thousand per quarter how did that take place um they just altered the rules in.
2021 versus because 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 as much as 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 employee that is since that’s a great deal 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 on average Kevin is if you took PPP cash someplace around 10 thousand dollars a person so let’s state hypothetically you owned a dining establishment in New York City where I’m from and you had a hundred staff members and you took PPP cash you would still get a million dollar in the mail from the IRS so it’s big certainly now the huge concern is why does nobody know about this since appearance when I first became aware of this when I initially satisfied Josh you know I have actually got great deals of investments in great deals of companies I’m a significant supporter for entrepreneurship in America and make many numerous financial investments in business owners of which numerous suffered through the pandemic when I initially became aware of this I called BS I don’t think it due to the fact that 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 and that were well deserved and we used them wisely to stay alive during the pandemic so when I heard about this I said nah it can’t be true however when I dug around I even called to my political leader good friends Governor Senators they didn’t know about it I suggest that’s how you know that’s how misinformation is that there’s no details out there then a lot of people informed me well you can’t get it because you took the PPP also not real so let’s ask Josh why does no one learn about the employee retention credit you understand what’s fascinating you’re talking about the banks Kevin since in the PPP loan procedure 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 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 just process procedure that’s all um and here there was chaos due to the fact that 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 original program and when they altered the law in 2021 the banks were refraining from doing ERC because it’s not alone so you’re getting a tax refund so the government never ever made it clear to any person about how to.
do this does your CFO understand how to do this not actually she or he’s never ever done it in the past do the banks do it nope the banks do not do it the payroll business yeah a few of them are doing it as a payroll company your accountant no your accountant’s never ever done this prior to unless you have an account that entered into this organization and bottom line my company Kevin has actually been in business because 2009 and we have actually been dealing with the federal government and the state federal government to recover money for Fortune 500 Fortune 1000 companies so a great deal of our big big business customers have dealt with bottom line to recover other government programs we’ve done sales tax and utilize tax unemployment tax work chance tax credits research and development tax credits unclaimed property property tax all of these other government programs.
The worker retention tax credit is a broad based refundable tax credit created to motivate.
employers to keep staff members on their payroll. The credit is 50% of up to $10,000 in salaries paid by an.
Due to the fact that of COVID-19 or whose gross receipts, company whose organization is totally or partly suspended.
decline by more than 50%.
1. The credit is available to all companies no matter size including tax exempt companies. There are.
just 2 exceptions: (1) state and local governments and their instrumentalities and (2) little.
companies who take Small company Loans.
2. To qualify, the employer needs to satisfy one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the employer’s organization is fully or partly suspended by federal government order due to COVID-19.
during the calendar quarter or.
o the company’s gross invoices are below 50% of the equivalent quarter in 2019. When the.
company’s gross invoices go above 80% of an equivalent quarter in 2019 they no longer qualify.
after completion of that quarter.
Calculation of the Credit.
The amount of the credit is 50% of the qualifying incomes paid up to $10,000 in overall.
It works for salaries paid after March 13th and prior to December 31, 2020.
The definition of qualifying wages varies by whether an employer had, typically, more or less than.
100 staff members in 2019.
Business that concentrate on ERC filing help typically provide competence and assistance to assist businesses browse the complex process of claiming the credit. They can offer numerous services, including:.
How is the employee retention credit calculated? Ppp Loan And Employee Retention Credit
Eligibility Evaluation: These business will evaluate your company’s eligibility for the ERC based on elements such as your market, earnings, and operations. They can help determine if you fulfill the requirements for the credit and determine the maximum credit quantity you can declare.
Paperwork and Calculation: ERC filing services will assist in gathering the necessary documentation, such as payroll records and financial statements, to support your claim. They will likewise help calculate the credit amount based upon qualified salaries and other qualifying expenditures.
Retroactive Claim Evaluation: If you are eligible to declare the ERC for prior quarters, these business can examine your past payroll records and financials to identify prospective chances for retroactive credits. They can assist you amend prior income tax return to declare these refunds.
Filing Support: Companies concentrating on ERC filings will prepare and submit the required forms and documents in your place. This includes finishing Type 941 or any other necessary tax return.
Compliance and Updates: ERC regulations and assistance have actually evolved in time. These companies remain upgraded with the current modifications and make sure that your filings comply with the most current guidelines. They can also provide continuous assistance if the IRS requests extra information or performs an audit related to your ERC claim.
It is very important to research and veterinarian any business offering ERC filing help to guarantee their credibility and competence. Search for established firms with experience in tax and payroll services, or think about reaching out to relied on accounting firms or tax professionals who provide ERC submitting assistance.
Keep in mind that while these companies can offer valuable assistance, it’s constantly a great concept to have a fundamental understanding of the ERC requirements and procedure yourself. This will help you make notified choices and make sure accurate filings.
The Worker 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 businesses to retain and pay their workers throughout the pandemic, even if their operations have been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is available to eligible companies, consisting of for-profit companies, tax-exempt companies, and specific governmental entities. To qualify, companies must satisfy one of two requirements:.
The business operations were completely or partly suspended due to a federal government order related to COVID-19.
The business experienced a substantial decrease in gross invoices. As discussed earlier, for 2021, a substantial decline is specified as a 20% decrease in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a considerable decline is defined as a 20% decrease in gross invoices compared to the exact same quarter in 2019, or a 20% decline in gross receipts compared to the right away preceding quarter.
Credit Amount: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit quantity amounts to a percentage (up to 70%) of qualified earnings paid to employees, including specific health insurance expenses. The maximum credit per worker is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: At first, organizations that got an Income Protection Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 allows organizations to claim the ERC even if they received a PPP loan. 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 enhanced, enabling eligible companies to declare the credit for certified incomes paid as far back as March 13, 2020. This retroactive provision supplies an opportunity for organizations to change prior-year tax returns and receive refunds.
Declaring the Credit: Companies can declare the ERC by reporting it on their work tax returns, generally Kind 941. The excess can be reimbursed to the employer if the credit surpasses the amount of employment taxes owed.
It’s important to keep in mind that the ERC arrangements and eligibility criteria have actually progressed over time. The very best course of action is to talk to a tax expert or go to the main IRS site for the most up-to-date and comprehensive details regarding the ERC, consisting of any recent legislative modifications or updates.
To qualify for the ERC, a business must fulfill one of the following criteria:.
Business operations were completely or partly suspended due to a federal government order related to COVID-19.
The business experienced a considerable decline 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 significant decline is specified as a 20% decline in gross invoices compared to the same quarter in 2019, or a 20% decline in gross receipts compared to the immediately preceding quarter.
The ERC is available to services of all sizes, including tax-exempt companies, but there are some exceptions. Federal government entities and organizations that got a PPP loan may have constraints on declaring the credit.
The process for claiming the ERC involves completing the required forms and consisting of the credit on your work tax return (normally Kind 941). The exact time it requires to process the credit can differ based upon a number of elements, consisting of the complexity of your company and the work of the internal revenue service. It’s suggested to seek advice from a tax expert for assistance specific to your scenario.
There are numerous business that can assist with the process of declaring the ERC. Some well-known business that use help with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the information offered here is based upon basic understanding and may not reflect the most recent updates or modifications to the ERC. It’s important to consult with a tax expert or go to the main IRS site for the most up-to-date and accurate details relating to eligibility, claiming procedures, and available support.
Less than 100. If the company had 100 or fewer workers typically in 2019, then the credit is based.
on salaries paid to all workers whether they in fact worked or not. To put it simply, even if the.
workers worked full time and earned money for full-time work, the employer still gets the credit.
Greater than 100. If the company had more than 100 employees on average in 2019, then the credit is.
enabled only for salaries paid to workers who did not work during the calendar quarter.
In both cases, “earnings” includes not just money payments but likewise a part of the cost of employer.
provided healthcare. Ppp Loan And Employee Retention Credit
Companies can be immediately compensated for the credit by lowering the quantity of payroll taxes they.