Lets talk first about Q3 2021 Employee Retention Credit :
Our team here what do these people doing everyone in this room is helping teach individuals about ERC and uh always supply a stunning breakfast and have individuals actually discover the program we should head to the space where we have the ability to show a few of the checks that we are getting for business and I want to see that what is this this is uh hundreds of countless dollars actually Kevin hundreds of millions of dollars so these are replicate copies of the letters that go to customers confirming that the check is on the method I imply you know if you simply start to look at some of these here I mean this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I suggest it’s simply I indicate think about the number of real clients 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 IRS heading to the client so that’s how you have the ability to track it you know when you
receive this you know the check is chosen sure which’s when they pay so they don’t pay anything up until they really receive the money they don’t pay bottom line Wonder trust anything till this letter is confirmed the check is on the method they deposit it into their savings account and they can truly trust Wonder trust that the procedure has actually been ended up and how many you believe you have actually processed since you started this we’re about 35 000 of these for
about 6 billion dollars wow so clearly they understand what they’re doing and that’s what you require you require experts on the other end of the phone to process this and get it to where you get among 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 employee retention credit which most of you have never ever become aware of I certainly had not heard of it until very recently and discovered a lot about it because this is most likely the most affordable expense of capital for any small company anywhere
anytime if you have workers in between five and five hundred so I have actually got the expert 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 difficult this isn’t like PPP we simply phone your bank supervisor and say offer 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 spokesperson for this I like this program it’s disappearing very soon you got to learn all about it let’s talk staff member retention credit Josh Fox what is an ERC let’s just start there so throughout the Trump Administration when President Trump was enacted they developed 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 practically everyone it makes a huge difference right there 2 of them are loans and one’s a refund exactly so the ERC is a refund that’s.
fix the money cash payroll tax refund fine go on sorry I simply need to make sure we got that point I mean that’s a big distinction a loan versus cash money I like cash cash that’s what we’re speaking 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 beautiful tough check in the mail where you get actual cash from the internal revenue service all right so let’s talk about how it works since 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 Presumption this cash is not for the owner not for individuals on the cap table not for investors it’s for staff members right you needed to have owned a business however it’s based upon you having W-2 employees 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 very first six 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 2 3 and four of 2020 and you had quarters one 2 and 3 of 2021. alright so that’s how it’s determined you have to be on the W-2 throughout that duration now let’s talk my favorite part money how much can you get back per staff member that was on a W-2 in those six quarters so the computation in 2020 to be precise 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 increased to 70 of the worker’s salary to a maximum of seven thousand per quarter how did that take place um they simply altered the rules in.
2021 versus since 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 as much as five thousand Max and after that what happens 21 000 Max in 2021 oh that’s how you develop twenty 6 thousand twenty one thousand to twenty twenty one plus five thousand in twenty twenty that’s twenty 6 thousand dollars per staff member that is since that’s a lot of money it is now there’s a caveat here the PPP cash would have to be decreased 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 typically Kevin is if you took PPP cash somewhere around 10 thousand dollars a person so let’s say hypothetically you owned a restaurant in New york city 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 internal revenue service so it’s huge clearly now the big concern is why does no one learn about this since look when I initially heard about this when I first satisfied Josh you know I’ve got lots of financial investments in great deals of business I’m a significant supporter for entrepreneurship in America and make many numerous financial investments in business owners of which lots of suffered through the pandemic when I initially became aware of 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 and that were well should have and we utilized them sensibly to survive throughout 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 political leader pals Guv Senators they didn’t know about it I indicate that’s how you understand that’s how false information is that there’s no details out there then a bunch of individuals told me well you can’t get it because you took the PPP likewise not real so let’s ask Josh why does nobody know about the worker retention credit you know what’s intriguing you’re talking about the banks Kevin due to the fact that 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 big banks in our country and they would process procedure in Canada a pre-pp loan there’s no loans in Canada by the way it’s simply process process that’s all um and here there was mayhem since keep in mind in the initial cares act you could refrain from doing both programs so if you had done PPP you might not do ERC in the original program and when they changed 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 government never made it clear to any person about how to.
do this does your CFO understand how to do this not truly she or he’s never done it before 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 accounting professional no your accounting professional’s never ever done this prior to unless you have an account that entered into this business and bottom line my company Kevin has stayed in business considering that 2009 and we have actually been working with the federal government and the state government to recuperate money for Fortune 500 Fortune 1000 companies so a lot of our huge huge corporate customers have worked with bottom line to recuperate other government programs we’ve done sales tax and utilize tax joblessness tax work chance tax credits research and development tax credits unclaimed home real estate tax all of these other government programs.
The staff member retention tax credit is a broad based refundable tax credit designed to encourage.
companies to keep workers on their payroll. The credit is 50% of as much as $10,000 in salaries paid by an.
employer whose service is completely or partially suspended because of COVID-19 or whose gross invoices.
decline by more than 50%.
1. The credit is offered to all companies regardless of size consisting of tax exempt organizations. There are.
only two exceptions: (1) state and city governments and their instrumentalities and (2) small.
organizations who take Small Business Loans.
2. To qualify, the company has to satisfy one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the company’s service is totally or partially suspended by government order due to COVID-19.
during the calendar quarter or.
o the company’s gross invoices are listed below 50% of the similar quarter in 2019. When the.
company’s gross invoices go above 80% of an equivalent quarter in 2019 they no longer certify.
after completion of that quarter.
Computation of the Credit.
The quantity of the credit is 50% of the qualifying wages paid up to $10,000 in overall.
It is effective for earnings paid after March 13th and before December 31, 2020.
The meaning of qualifying incomes differs by whether a company had, typically, more or less than.
100 employees in 2019.
Business that focus on ERC filing support generally supply expertise and support to assist businesses navigate the intricate procedure of declaring the credit. They can use various services, including:.
How is the employee retention credit calculated? Q3 2021 Employee Retention Credit
Eligibility Assessment: These business will assess your service’s eligibility for the ERC based on factors such as your market, revenue, and operations. If you fulfill the requirements for the credit and determine the optimum credit amount you can declare, they can help identify.
Documentation and Calculation: ERC filing services will help in collecting the essential documents, such as payroll records and monetary declarations, to support your claim. They will also help determine the credit quantity based upon qualified earnings and other qualifying costs.
Retroactive Claim Review: If you are eligible to claim the ERC for prior quarters, these business can evaluate your past payroll records and financials to identify potential chances for retroactive credits. They can assist you change previous tax returns to declare these refunds.
Filing Assistance: Business concentrating on ERC filings will prepare and submit the necessary types and documents on your behalf. This consists of completing Kind 941 or any other required tax forms.
Compliance and Updates: ERC guidelines and assistance have progressed with time. These business stay upgraded with the latest changes and guarantee that your filings abide by the most present standards. They can likewise supply continuous support if the IRS requests extra details or carries out an audit related to your ERC claim.
It is necessary to research study and veterinarian any business using ERC filing help to ensure their trustworthiness and proficiency. Look for recognized companies with experience in tax and payroll services, or consider reaching out to trusted accounting companies or tax specialists who offer ERC filing support.
Remember that while these business can offer valuable assistance, it’s constantly an excellent idea to have a basic understanding of the ERC requirements and procedure yourself. This will assist you make informed choices and make sure accurate filings.
The Worker 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 companies to keep and pay their employees throughout 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, including for-profit businesses, tax-exempt organizations, and certain governmental entities. To certify, companies must fulfill one of two criteria:.
The business operations were fully or partially suspended due to a government order related to COVID-19.
Business experienced a considerable decline in gross invoices. As mentioned earlier, for 2021, a substantial decrease is specified as a 20% decline in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a substantial decrease is specified as a 20% decrease in gross receipts compared to the very same quarter in 2019, or a 20% decrease in gross invoices compared to the right away preceding quarter.
Credit Quantity: 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 (approximately 70%) of certified salaries paid to staff members, consisting of particular health plan expenses. The maximum credit per employee is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, organizations that received a Paycheck Protection Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 allows businesses to claim the ERC even if they got a PPP loan. The exact same earnings can not be utilized to claim 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 qualified earnings paid as far back as March 13, 2020. This retroactive arrangement supplies a chance for services to modify prior-year income tax return and get refunds.
Claiming the Credit: Companies can claim the ERC by reporting it on their work tax returns, usually Form 941. If the credit exceeds the amount of employment taxes owed, the excess can be reimbursed to the employer.
It is essential to note that the ERC provisions and eligibility criteria have progressed in time. The best strategy is to consult with a tax expert or visit the main IRS website for the most updated and comprehensive details regarding the ERC, including any recent legal modifications or updates.
To receive the ERC, an organization must satisfy one of the following requirements:.
The business operations were fully or partly suspended due to a federal government order related to COVID-19.
Business experienced a considerable decrease in gross invoices. For 2021, a substantial decline is defined as a 20% decrease in gross receipts 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% decline in gross receipts compared to the right away preceding quarter.
The ERC is readily available to services of all sizes, including tax-exempt companies, however there are some exceptions. Government entities and organizations that got a PPP loan may have constraints on declaring the credit.
The process for declaring the ERC involves completing the necessary types and consisting of the credit on your work tax return (typically Type 941). The exact time it takes to process the credit can differ based upon a number of aspects, including the intricacy of your company and the work of the IRS. It’s suggested to consult with a tax professional for guidance particular to your scenario.
There are a number of business that can help with the process of declaring the ERC. These consist of accounting companies, tax advisory services, and payroll provider. Some widely known business that use assistance with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s suggested to research study and get in touch with these business directly to ask about their services and fees.
Please note that the information offered here is based upon general knowledge and may not show the most current updates or modifications to the ERC. It is essential to seek advice from a tax expert or check out the main IRS site for the most updated and accurate info relating to eligibility, claiming procedures, and readily available support.
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 in fact worked or not. Simply put, 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 staff members usually in 2019, then the credit is.
allowed only for salaries paid to staff members who did not work throughout the calendar quarter.
In both cases, “earnings” includes not simply cash payments however also a part of the expense of company.
supplied health care. Q3 2021 Employee Retention Credit
Companies can be right away compensated for the credit by reducing the amount of payroll taxes they.