Lets talk first about Revised 941 For Employee Retention Credit :
Our group here what do these men doing everyone in this room is assisting teach individuals about ERC and uh always provide a gorgeous breakfast and have people really find out about the program we should head to the room where we have the ability to show 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 literally Kevin numerous countless dollars so these are duplicate copies of the letters that go to customers confirming that the check is on the method I indicate you know if you just begin to 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 imply it’s just I indicate consider how many actual clients 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 validated and the check is on the mail in the mail from the IRS heading to the client so that’s how you’re able to track it you understand when you
get this you know the check is gone for sure which’s when they pay so they do not pay anything till they in fact receive the money they don’t pay bottom line Wonder trust anything till this letter is verified the check is on the method they transfer it into their bank account and they can genuinely trust Wonder trust that the process has been completed and how many you believe you’ve processed given that you started this we’re about 35 000 of these for
about six billion dollars wow so plainly they understand what they’re doing which’s what you need 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 Wonderful here you’re at my YouTube channel we’re talking about something really important today the worker retention credit which the majority of you have actually never ever heard of I certainly hadn’t heard of it up until extremely just recently and discovered a lot about it due to the fact that this is most likely the lowest cost of capital for any small company anywhere
anytime if you have staff members in between 5 and five hundred so I have actually got the specialist with me this is Josh Fox he’s the founder and CEO of bottom line Concepts they’re the biggest processor of these ERC credits this is a 170 page program so it’s challenging this isn’t like PPP we just call your bank supervisor and say 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’ve ended up being yes the Ambassador and paid representative for this I love this program it’s going away soon you got to find out all about it let’s talk worker retention credit Josh Fox what is an ERC let’s simply begin there so throughout the Trump Administration when President Trump was enacted they came up with the cares Act and the cares act offered services 3 opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically 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.
fix the cash cash payroll tax refund okay go on sorry I just need to ensure we got that point I suggest that’s a huge distinction a loan versus money cash I like money money that’s what we’re talking about fine 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 cash from the internal revenue service all right so let’s discuss how it works since it seems like to me if it’s a if it’s employee retention credit that individual needed to be a worker so I’m going to make the Presumption this money 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 an organization however it’s based upon you having W-2 workers in America not 10.99. so as long as you had W-2 staff members 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 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 six quarters so you had quarters two 3 and four of 2020 and you had quarters one 2 and 3 of 2021. alright so that’s how it’s determined you need to be on the W-2 during that period now let’s talk my preferred part money how much can you return per worker that was on a W-2 in those six quarters so the calculation in 2020 to be exact Kevin is 50 of the staff member’s wage to a maximum of 5 thousand dollars per staff member for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the worker’s wage to a maximum of 7 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 workers on payroll 100 so if you can get 5 000 per person Max in twenty that was 50 in 2020 up to 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 5 thousand in twenty twenty that’s twenty six thousand dollars per staff member that is since that’s a lot of money it is now there’s a caveat here the PPP money would have to be minimized 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 usually Kevin is if you took PPP money somewhere around ten thousand dollars an individual so let’s say hypothetically you owned a dining establishment in New york city City where I’m from and you had a hundred employees and you took PPP cash you would still get a million dollar in the mail from the internal revenue service so it’s substantial certainly now the huge question is why does no one understand about this due to the fact that appearance when I initially found out about this when I initially met Josh you know I’ve got great deals of financial investments in lots of companies I’m a major supporter for entrepreneurship in America and make numerous many investments in business owners of which lots of suffered through the pandemic when I first found out about this I called BS I don’t believe it because I use the PPP we went through the cash center Banks to get it it was really 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 carefully to survive throughout the pandemic so when I heard about this I said nah it can’t be true but when I dug around I even contacted us to my politician good friends Guv Senators they didn’t know about it I imply that’s how you understand that’s how false information is that there’s no info out there then a bunch of individuals informed me well you can’t get it since you took the PPP likewise not real so let’s ask Josh why does no one know about the staff member retention credit you understand what’s fascinating you’re talking about the banks Kevin due to the fact that in the PPP loan procedure the federal government made it really clear that if you wanted a PPP loan you would call Wells Fargo Citibank Bank of America any of the huge banks in our country 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 turmoil due to the fact that keep in mind in the initial cares act you might not do both programs so if you had done PPP you could refrain from doing ERC in the original program and when they changed 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 made it clear to any person about how to.
do this does your CFO know how to do this not truly she or he’s never done it in the past 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 before unless you have an account that entered into this business and bottom line my firm Kevin has stayed in business considering that 2009 and we’ve been working with the federal government and the state government to recuperate money for Fortune 500 Fortune 1000 business so a great deal of our huge huge corporate clients have worked with bottom line to recuperate other federal government programs we have actually done sales tax and use tax unemployment tax work opportunity tax credits research and development tax credits unclaimed home property tax all of these other federal government programs.
The staff member retention tax credit is a broad based refundable tax credit developed to encourage.
employers to keep workers on their payroll. The credit is 50% of as much as $10,000 in incomes paid by an.
employer whose organization is fully or partially suspended because of COVID-19 or whose gross invoices.
decrease by more than 50%.
1. The credit is available to all employers regardless of size consisting of tax exempt organizations. There are.
only 2 exceptions: (1) state and city governments and their instrumentalities and (2) small.
services who take Small company Loans.
2. To certify, the employer has to meet one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the company’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 listed below 50% of the comparable quarter in 2019. When the.
employer’s gross receipts exceed 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 certifying earnings paid up to $10,000 in total.
It works for earnings paid after March 13th and prior to December 31, 2020.
The definition of certifying earnings differs by whether a company had, typically, more or less than.
100 employees in 2019.
Business that concentrate on ERC filing assistance typically offer know-how and assistance to help organizations navigate the intricate process of claiming the credit. They can offer numerous services, including:.
How is the employee retention credit calculated? Revised 941 For Employee Retention Credit
Eligibility Evaluation: These companies will evaluate your company’s eligibility for the ERC based on aspects such as your market, profits, and operations. They can help determine if you fulfill the requirements for the credit and determine the maximum credit quantity you can claim.
Paperwork and Estimation: ERC filing services will help in gathering the required documents, such as payroll records and monetary statements, to support your claim. They will also help determine the credit amount based on eligible salaries and other certifying costs.
Retroactive Claim Evaluation: If you are qualified to claim the ERC for previous quarters, these companies can evaluate your past payroll records and financials to recognize prospective opportunities for retroactive credits. They can help you modify prior income tax return to claim these refunds.
Filing Support: Business specializing in ERC filings will prepare and submit the required forms and documents on your behalf. This includes completing Type 941 or any other required tax return.
Compliance and Updates: ERC guidelines and guidance have developed over time. These companies stay updated with the most recent modifications and make sure that your filings abide by the most present standards. If the IRS requests additional details or conducts an audit related to your ERC claim, they can likewise offer ongoing assistance.
It’s important to research and vet any company using ERC filing assistance to ensure their credibility and knowledge. Search for established companies with experience in tax and payroll services, or think about connecting to trusted accounting firms or tax specialists who provide ERC submitting support.
Bear in mind that while these companies can provide important help, it’s constantly a great idea to have a basic understanding of the ERC requirements and procedure yourself. This will assist you make informed decisions and ensure accurate 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 objective of the ERC is to encourage services to maintain and pay their workers during the pandemic, even if their operations have actually been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is readily available to eligible companies, consisting of for-profit services, tax-exempt companies, and certain governmental entities. To certify, employers need to satisfy one of two criteria:.
Business operations were fully or partially suspended due to a federal government order related to COVID-19.
Business experienced a considerable decrease in gross invoices. As mentioned earlier, for 2021, a substantial decline is defined as a 20% decline in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a substantial decrease is specified as a 20% decline in gross invoices compared to the 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 employer’s share of Social Security taxes. The credit quantity is equal to a percentage (as much as 70%) of certified earnings paid to employees, consisting of specific health plan costs. 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, companies that received an Income Protection Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 permits businesses to claim the ERC even if they got a PPP loan. The exact same salaries can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively broadened and boosted, enabling qualified employers to declare the credit for qualified earnings paid as far back as March 13, 2020. This retroactive provision provides an opportunity for services to modify prior-year income tax return and get refunds.
Claiming the Credit: Employers can claim the ERC by reporting it on their employment tax returns, typically Form 941. If the credit exceeds the amount of employment taxes owed, the excess can be reimbursed to the company.
It’s important to note that the ERC arrangements and eligibility requirements have evolved gradually. The best course of action is to speak with a tax expert or visit the main internal revenue service site for the most in-depth and updated information regarding the ERC, including any recent legal modifications or updates.
To receive the ERC, a company must meet among the following requirements:.
Business operations were fully or partly suspended due to a government order related to COVID-19.
Business experienced a significant decline in gross receipts. 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 decrease is specified as a 20% decrease in gross receipts compared to the same quarter in 2019, or a 20% decline in gross invoices compared to the right away preceding quarter.
The ERC is readily available to businesses of all sizes, including tax-exempt organizations, however there are some exceptions. Government entities and organizations that got a PPP loan might have constraints on claiming the credit.
The procedure for claiming the ERC involves finishing the required forms and consisting of the credit on your work tax return (typically Form 941). The exact time it takes to process the credit can differ based on a number of aspects, consisting of the complexity of your business and the workload of the IRS. It’s advised to talk to a tax professional for assistance particular to your scenario.
There are several companies that can aid with the process of declaring the ERC. These consist of accounting companies, tax advisory services, and payroll company. Some widely known business that offer support with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s a good idea to research and contact these business straight to ask about their charges and services.
Please keep in mind that the info offered here is based on basic knowledge and might not reflect the most recent updates or changes to the ERC. It’s important to speak with a tax professional or visit the official internal revenue service site for the most accurate and current details relating to eligibility, claiming treatments, and readily available support.
Less than 100. The credit is based if the employer had 100 or less staff members on average in 2019.
on earnings paid to all workers whether they actually worked or not. Simply put, 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 staff members on average in 2019.
allowed just for earnings paid to staff members who did not work during the calendar quarter.
In both cases, “earnings” includes not just cash payments however also a part of the cost of employer.
supplied health care. Revised 941 For Employee Retention Credit
Companies can be right away repaid for the credit by reducing the amount of payroll taxes they.