Lets talk first about Recovery Startup Business Employee Retention Credit 2021 :
Our team here what do these guys doing everybody in this room is assisting teach people about ERC and uh constantly offer a lovely breakfast and have individuals really learn about the program we ought to head to the space 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 numerous countless dollars so these are replicate copies of the letters that go to customers verifying that the check is on the way I indicate you know 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 simply I mean think about how many actual customers that went through the program yeah this is the very end this is the party at the end when the check is validated the numbers are confirmed and the check is on the mail in the mail from the IRS heading to the consumer so that’s how you’re able to track it you know when you
get this you understand the check is opted for sure which’s when they pay so they don’t pay anything until they actually receive the money they don’t pay bottom line Wonder trust anything until this letter is verified the check is on the method they transfer it into their savings account and they can genuinely rely on Wonder trust that the procedure has been completed and the number of you believe you’ve processed since you started this we have to do with 35 000 of these for
about six billion dollars wow so clearly they know what they’re doing and that’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 essential today the worker retention credit which most of you have never ever become aware of I certainly had not heard of it up until really just recently and found out a lot about it because this is most likely the lowest expense of capital for any small business anywhere
anytime if you have staff members between five and five hundred so I’ve got the specialist with me this is Josh Fox he’s the founder 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 just call up your bank supervisor and state provide 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’ve become yes the Ambassador and paid representative for this I love this program it’s disappearing soon you got to discover all about it let’s talk staff member 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 used services three opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically everyone it makes a huge distinction right there two of them are loans and one’s a refund exactly so the ERC is a refund that’s.
remedy the money money payroll tax refund all right go on sorry I simply have to make certain we got that point I suggest that’s a big difference a loan versus money money I like cash 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 initial cares Act is the ERC and yes Kevin it is a beautiful hard check in the mail where you get real money from the IRS all right so let’s speak about how it works because it sounds like to me if it’s a if it’s employee retention credit that person needed to be a worker 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 company however it’s based on 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 right so there were 6 quarters the program was open well walk us through the 6 quarters so you had quarters 2 3 and 4 of 2020 and you had quarters one 2 and three of 2021. all right so that’s how it’s determined you need to be on the W-2 during that duration now let’s talk my preferred 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 specific Kevin is 50 of the staff member’s salary 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 happen 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 staff members 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 happens 21 000 Max in 2021 oh that’s how you develop twenty six thousand twenty one thousand to twenty twenty one plus five thousand in twenty twenty that’s twenty 6 thousand dollars per employee that is since that’s a lot of money it is now there’s a caution 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 2 you would decrease the 26 000 so what we’re seeing on average Kevin is if you took PPP money 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 IRS so it’s huge clearly now the big question is why does no one know about this because appearance when I first found out about this when I first fulfilled Josh you know I have actually got lots of financial investments in great deals of companies I’m a significant supporter for entrepreneurship in America and make many lots of investments in entrepreneurs of which many suffered through the pandemic when I initially found out about this I called BS I do not think it because I use 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 survive during the pandemic so when I found out about this I said nah it can’t hold true but when I dug around I even called to my politician good friends Guv Senators they didn’t learn about it I mean that’s how you understand that’s how false information is that there’s no information out there then a bunch of people informed 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 know what’s intriguing you’re speaking about the banks Kevin since in the PPP loan process the federal government made it very clear that if you wanted a PPP loan you would call Wells Fargo Citibank Bank of America any of the big 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 process procedure 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 actually done PPP you could not do ERC in the initial program and when they altered the law in 2021 the banks were refraining from doing ERC since it’s not alone so you’re getting a tax refund so the government never ever made it clear to anybody about how to.
do this does your CFO know how to do this not truly she or he’s never ever done it previously do the banks do it nope the banks do not do it the payroll business yeah some of them are doing it as a payroll company your accounting professional 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 since 2009 and we have actually been working with the federal government and the state government to recuperate cash for Fortune 500 Fortune 1000 business so a lot of our huge big corporate clients have worked with bottom line to recuperate other government programs we have actually done sales tax and use tax joblessness tax work opportunity tax credits research and development tax credits unclaimed home real estate tax all of these other government programs.
The worker retention tax credit is a broad based refundable tax credit created to motivate.
companies to keep workers on their payroll. The credit is 50% of up to $10,000 in wages paid by an.
company whose business is fully or partly suspended because of COVID-19 or whose gross receipts.
decline by more than 50%.
1. The credit is readily available to all employers regardless of size including tax exempt organizations. There are.
only 2 exceptions: (1) state and local governments and their instrumentalities and (2) small.
organizations who take Small company Loans.
2. To qualify, the company has to fulfill one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the employer’s service is totally 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.
company’s gross invoices 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 incomes paid up to $10,000 in overall.
It is effective for salaries paid after March 13th and prior to December 31, 2020.
The meaning of qualifying salaries differs by whether a company had, usually, more or less than.
100 employees in 2019.
Companies that concentrate on ERC filing assistance normally offer knowledge and support to assist companies browse the intricate process of declaring the credit. They can offer numerous services, including:.
How is the employee retention credit calculated? Recovery Startup Business Employee Retention Credit 2021
Eligibility Assessment: These companies will assess your company’s eligibility for the ERC based upon factors such as your industry, income, and operations. They can assist identify if you fulfill the requirements for the credit and recognize the optimum credit amount you can claim.
Paperwork and Estimation: ERC filing services will assist in collecting the required documentation, such as payroll records and financial statements, to support your claim. They will likewise assist compute the credit amount based on qualified salaries and other qualifying expenditures.
Retroactive Claim Review: If you are eligible to claim the ERC for previous quarters, these business can evaluate your previous payroll records and financials to determine prospective opportunities for retroactive credits. They can assist you modify previous income tax return to declare these refunds.
Filing Support: Companies focusing on ERC filings will prepare and send the needed kinds and documentation on your behalf. This consists of finishing Form 941 or any other necessary tax return.
Compliance and Updates: ERC guidelines and guidance have developed in time. These companies stay updated with the latest changes and guarantee that your filings abide by the most existing standards. They can likewise offer ongoing assistance if the IRS demands extra info or conducts an audit related to your ERC claim.
It’s important to research and veterinarian any company using ERC filing assistance to ensure their credibility and competence. Look for established firms with experience in tax and payroll services, or consider reaching out to relied on accounting companies or tax specialists who offer ERC filing support.
Keep in mind that while these business can provide important support, it’s always a great concept to have a fundamental understanding of the ERC requirements and procedure yourself. This will assist you make notified choices and ensure accurate filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit introduced by the U.S. federal government as part of COVID-19 relief measures. The goal of the ERC is to motivate companies 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 available to qualified companies, consisting of for-profit organizations, tax-exempt companies, and specific governmental entities. To certify, employers need to 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 substantial decrease in gross receipts. As pointed out earlier, for 2021, a significant decline is specified as a 20% decline in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a significant decrease is specified as a 20% decrease in gross invoices compared to the exact 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 (up to 70%) of certified salaries paid to employees, including particular health insurance expenses. The optimum 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 Protection Program (PPP) loan were not qualified for the ERC. However, legislation passed in late 2020 and extended in 2021 permits services to claim the ERC even if they got a PPP loan. Nevertheless, the exact same salaries can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has actually been retroactively expanded and improved, permitting qualified companies to declare the credit for qualified incomes paid as far back as March 13, 2020. This retroactive arrangement provides an opportunity for companies to modify prior-year income tax return and receive refunds.
Claiming the Credit: Companies can declare the ERC by reporting it on their work income tax return, typically Type 941. If the credit goes beyond the quantity of employment taxes owed, the excess can be refunded to the employer.
It is very important to note that the ERC provisions and eligibility criteria have actually evolved with time. The very best course of action is to talk to a tax expert or check out the official IRS site for the most current and detailed information concerning the ERC, including any current legislative changes or updates.
To receive the ERC, an organization should fulfill among the following requirements:.
Business operations were totally or partly suspended due to a federal government order related to COVID-19.
Business experienced a considerable decline in gross invoices. For 2021, a considerable decrease is specified as a 20% decline in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a significant decline is defined as a 20% decline in gross receipts compared to the very same quarter in 2019, or a 20% decline in gross invoices compared to the instantly preceding quarter.
The ERC is available to organizations of all sizes, consisting of tax-exempt companies, however there are some exceptions. Government entities and organizations that received a PPP loan may have limitations on declaring the credit.
The process for declaring the ERC includes finishing the needed forms and including the credit on your work income tax return (generally Form 941). The exact time it requires to process the credit can vary based on numerous aspects, including the intricacy of your organization and the workload of the internal revenue service. It’s advised to consult with a tax expert for assistance particular to your situation.
There are several business that can assist with the process of declaring the ERC. These consist of accounting firms, tax advisory services, and payroll provider. Some widely known companies that use assistance with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s suggested to research and get in touch with these business straight to ask about their services and fees.
Please keep in mind that the info supplied here is based upon general knowledge and may not show the most recent updates or modifications to the ERC. It is essential to consult with a tax expert or go to the official IRS website for the most updated and accurate information concerning eligibility, claiming procedures, and readily available support.
Less than 100. If the company had 100 or fewer employees on average in 2019, then the credit is based.
on earnings paid to all workers whether they in fact worked or not. In other words, even if the.
workers worked full time and made money for full time work, the company still gets the credit.
Greater than 100. The credit is if the employer had more than 100 employees on average in 2019.
enabled just for earnings paid to staff members who did not work throughout the calendar quarter.
In both cases, “salaries” includes not just money payments but also a part of the expense of employer.
supplied health care. Recovery Startup Business Employee Retention Credit 2021
Companies can be immediately compensated for the credit by minimizing the quantity of payroll taxes they.