Lets talk first about Sba Employee Retention Credit :
Our team here what do these men doing everyone in this room is assisting teach individuals about ERC and uh constantly provide a stunning breakfast and have people really find out 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 want to see that what is this this is uh hundreds of millions of dollars actually Kevin numerous millions of dollars so these are duplicate copies of the letters that go to customers verifying that the check is on the way I indicate you understand if you just begin to take a look at some 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 actual customers 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 confirmed 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 opted for sure and that’s when they pay so they do not pay anything up until they actually get the money they do not pay bottom line Wonder trust anything up until this letter is verified the check is on the method they transfer it into their bank account and they can truly trust Wonder trust that the procedure has been completed and the number of you think you have actually processed considering that you began this we have to do with 35 000 of these for
about six billion dollars wow so plainly they understand what they’re doing and that’s what you require you need 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 Fantastic here you’re at my YouTube channel we’re talking about something really essential today the employee retention credit which most of you have never heard of I certainly had not heard of it till very just recently and found out a lot about it because this is most likely the most affordable expense of capital for any small company anywhere
anytime if you have employees in between 5 and five hundred so I have actually got the specialist with me this is Josh Fox he’s the creator and CEO of bottom line Ideas 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 call up your bank manager and say give 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 ended up being yes the Ambassador and paid spokesperson for this I love this program it’s disappearing very soon you got to learn 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 came up with the cares Act and the cares act provided businesses 3 opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically everybody it makes a big distinction right there two of them are loans and one’s a refund exactly so the ERC is a refund that’s.
fix the cash money payroll tax refund fine go on sorry I simply have to make certain we got that point I suggest that’s a huge distinction a loan versus money money I like cash cash that’s what we’re talking about 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 original cares Act is the ERC and yes Kevin it is a lovely difficult check in the mail where you get actual cash from the IRS all right so let’s talk about how it works due to the fact that it seems like to me if it’s a if it’s worker retention credit that person had to be a worker so I’m going to make the Assumption 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 a business but it’s based upon you having W-2 staff members 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 qualified so you have to be on payroll in 2020 on the W-2 and you have to be on payroll for the first six 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 3 and four 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 throughout that duration now let’s talk my preferred part money how much can you return per worker that was on a W-2 in those 6 quarters so the estimation in 2020 to be specific Kevin is 50 of the employee’s salary to a maximum of 5 thousand dollars per worker for the year of 2020 and in 2021 the numbers escalated to 70 of the worker’s wage to a maximum of seven thousand per quarter how did that happen um they just changed 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 approximately 5 thousand Max and then what takes place 21 000 Max in 2021 oh that’s how you develop twenty six thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty 6 thousand dollars per worker that is since that’s a great deal of cash it is now there’s a caveat here the PPP money would need to be minimized from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan 2 you would lower the 26 000 so what we’re seeing typically Kevin is if you took PPP cash somewhere around ten thousand dollars an individual so let’s state hypothetically you owned a dining establishment in New York 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 IRS so it’s substantial undoubtedly now the huge question is why does nobody understand about this since look when I initially found out about this when I first met Josh you understand I’ve got lots of investments in great deals of business I’m a major supporter for entrepreneurship in America and make numerous many financial investments in entrepreneurs of which many suffered through the pandemic when I first found out about this I called BS I do not believe it because I utilize the PPP we went through the money center Banks to get it it was really 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 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 pals Governor Senators they didn’t know about it I indicate that’s how you understand that’s how false information is that there’s no info out there then a bunch of people told me well you can’t get it due to the fact that you took the PPP also not true so let’s ask Josh why does nobody understand about the employee retention credit you know what’s interesting you’re speaking about the banks Kevin due to the fact that in the PPP loan process 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 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 just process process that’s all um and here there was turmoil since remember in the initial cares act you could refrain from doing both programs so if you had actually done PPP you might refrain from doing ERC in the initial program and when they altered the law in 2021 the banks were not doing ERC because it’s not alone so you’re getting a tax refund so the federal government never ever made it clear to any person 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 accountant no your accountant’s never ever done this before unless you have an account that went into this organization and bottom line my company Kevin has actually stayed in business since 2009 and we have actually been dealing with the federal government and the state federal government to recuperate money for Fortune 500 Fortune 1000 companies so a lot of our big huge corporate clients have actually worked with bottom line to recuperate other government programs we’ve done sales tax and utilize tax joblessness tax work opportunity 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 created to encourage.
companies to keep staff members on their payroll. The credit is 50% of approximately $10,000 in salaries paid by an.
Because of COVID-19 or whose gross receipts, employer whose business is fully or partially suspended.
decline by more than 50%.
1. The credit is readily available to all companies regardless of size including tax exempt organizations. There are.
only two exceptions: (1) state and local governments and their instrumentalities and (2) small.
services who take Small company Loans.
2. To certify, the employer has to fulfill one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the company’s service is fully or partially suspended by federal government order due to COVID-19.
during the calendar quarter or.
o the employer’s gross invoices are below 50% of the comparable quarter in 2019. Once the.
employer’s gross receipts exceed 80% of an equivalent quarter in 2019 they no longer certify.
after completion of that quarter.
Calculation 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 incomes paid after March 13th and prior to December 31, 2020.
The meaning of certifying earnings varies by whether a company had, typically, more or less than.
100 employees in 2019.
Companies that specialize in ERC filing assistance generally supply knowledge and support to assist services navigate the intricate process of claiming the credit. They can provide different services, including:.
How is the employee retention credit calculated? Sba Employee Retention Credit
Eligibility Evaluation: These business will examine your service’s eligibility for the ERC based on factors such as your industry, income, and operations. If you meet the requirements for the credit and recognize the optimum credit quantity you can claim, they can help identify.
Documents and Computation: ERC filing services will help in collecting the necessary documentation, such as payroll records and financial declarations, to support your claim. They will likewise assist compute the credit amount based upon eligible earnings and other certifying expenses.
Retroactive Claim Evaluation: If you are eligible to declare the ERC for prior quarters, these business can evaluate your previous payroll records and financials to determine potential opportunities for retroactive credits. They can help you change prior income tax return to claim these refunds.
Filing Assistance: Companies concentrating on ERC filings will prepare and send the necessary forms and documentation in your place. This consists of finishing Form 941 or any other required tax forms.
Compliance and Updates: ERC regulations and guidance have evolved in time. These business remain updated with the current modifications and make sure that your filings comply with the most current guidelines. If the Internal revenue service demands additional details or carries out an audit associated to your ERC claim, they can also offer continuous assistance.
It’s important to research and veterinarian any business providing ERC filing help to guarantee their trustworthiness and knowledge. Try to find established companies with experience in tax and payroll services, or think about reaching out to trusted accounting firms or tax experts who use ERC filing assistance.
Keep in mind that while these companies can supply valuable assistance, it’s always an excellent idea to have a fundamental understanding of the ERC requirements and procedure yourself. This will help you make informed choices and make sure precise filings.
The Worker Retention Credit (ERC) is a refundable tax credit presented by the U.S. federal government as part of COVID-19 relief steps. The objective of the ERC is to encourage services to maintain and pay their staff members throughout the pandemic, even if their operations have been impacted.
Here are some key points about the ERC:.
Eligibility: The ERC is available to eligible employers, consisting of for-profit services, tax-exempt companies, and particular governmental entities. To qualify, companies must fulfill one of two criteria:.
Business operations were totally or partly suspended due to a federal government order related to COVID-19.
The business experienced a significant decrease in gross receipts. As pointed out earlier, for 2021, a significant decrease is specified as a 20% decline in gross receipts compared to the exact 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% decrease in gross invoices compared to the instantly preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit quantity amounts to a percentage (approximately 70%) of qualified incomes paid to staff members, consisting of particular health plan expenditures. The maximum credit per employee is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: At first, businesses that got an Income Defense Program (PPP) loan were not qualified for the ERC. However, legislation passed in late 2020 and extended in 2021 permits businesses to claim the ERC even if they got a PPP loan. However, 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 expanded and enhanced, enabling qualified companies to claim the credit for qualified incomes paid as far back as March 13, 2020. This retroactive provision provides a chance for businesses to change prior-year tax returns and receive refunds.
Declaring the Credit: Companies can claim the ERC by reporting it on their employment income tax return, generally Form 941. The excess can be refunded to the employer if the credit goes beyond the amount of work taxes owed.
It is very important to note that the ERC arrangements and eligibility requirements have actually evolved over time. The best strategy is to consult with a tax expert or go to the main IRS site for the most comprehensive and updated info regarding the ERC, including any recent legislative changes or updates.
To get approved for the ERC, an organization must fulfill one of the following criteria:.
The business operations were totally or partially suspended due to a federal government order related to COVID-19.
The business experienced a significant decline in gross receipts. For 2021, a significant decline is defined as a 20% decline in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a significant decrease is defined as a 20% decrease in gross receipts compared to the very same quarter in 2019, or a 20% decrease in gross receipts compared to the right away preceding quarter.
The ERC is offered to organizations of all sizes, consisting of tax-exempt companies, however there are some exceptions. For example, government entities and companies that received a PPP loan might have limitations on declaring the credit.
The procedure for declaring the ERC involves completing the essential types and consisting of 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 aspects, consisting of the intricacy of your service and the work of the IRS. It’s advised to seek advice from a tax expert for guidance particular to your situation.
There are several companies that can help with the process of declaring the ERC. Some widely known companies that use help with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the information offered here is based on basic understanding and might not show the most current updates or changes to the ERC. It is very important to seek advice from a tax expert or check out the official IRS website for the most current and accurate information concerning eligibility, claiming treatments, and offered help.
Less than 100. The credit is based if the employer had 100 or less workers on average in 2019.
on incomes paid to all staff members whether they actually worked or not. Simply put, even if the.
staff members worked full-time and got paid for full-time work, the employer still gets the credit.
Greater than 100. If the employer had more than 100 employees on average in 2019, then the credit is.
permitted just for salaries paid to staff members who did not work throughout the calendar quarter.
In both cases, “incomes” includes not simply cash payments but likewise a part of the cost of employer.
supplied health care. Sba Employee Retention Credit
Companies can be right away repaid for the credit by reducing the amount of payroll taxes they.