Lets talk first about Texas Employee Retention Credit :
Our group here what do these people doing everyone in this space is assisting teach individuals about ERC and uh always offer a stunning breakfast and have individuals actually 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 literally Kevin numerous countless dollars so these are duplicate copies of the letters that go to customers verifying that the check is on the method I indicate you understand if you just 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 indicate it’s simply I imply think about the number of actual clients that went through the program yeah this is the very end this is the party at the end when the check is verified the numbers are validated and the check is on the mail in the mail from the internal revenue service 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 gone for sure which’s when they pay so they don’t pay anything up until they in fact receive the cash they do not pay bottom line Wonder trust anything till this letter is confirmed the check is on the way they deposit it into their bank account and they can truly trust Wonder trust that the process has actually been finished and the number of you think you’ve processed given that you started this we’re about 35 000 of these for
about 6 billion dollars wow so plainly 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 one of these that’s what matters all right Mr Fantastic here you’re at my YouTube channel we’re discussing something truly essential today the worker retention credit which the majority of you have actually never heard of I certainly had not become aware of it till very recently and discovered a lot about it since this is probably the lowest expense 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 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 not easy this isn’t like PPP we just call up your bank supervisor and state offer 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 ended up being yes the Ambassador and paid spokesperson for this I enjoy 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 simply start there so throughout the Trump Administration when President Trump was enacted they came up with the cares Act and the cares act used services 3 chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically everyone it makes a big difference right there 2 of them are loans and one’s a refund precisely so the ERC is a refund that’s.
remedy the cash cash payroll tax refund fine go on sorry I simply have to ensure we got that point I suggest that’s a big difference a loan versus cash cash I like cash cash that’s what we’re discussing 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 gorgeous difficult check in the mail where you get actual cash 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 staff member retention credit that individual needed to be a worker so I’m going to make the Presumption this cash is not for the owner not for individuals on the cap table not for shareholders it’s for staff members right you had to have actually owned an organization however it’s based upon you having W-2 workers in America not 10.99. As long as you had W-2 employees 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 6 months of 2021 on the W-2 right so there were six 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. alright so that’s how it’s determined you need to be on the W-2 during that duration now let’s talk my favorite part money how much can you return per employee that was on a W-2 in those six quarters so the estimation in 2020 to be exact Kevin is 50 of the employee’s wage to an optimum of five thousand dollars per worker for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the staff member’s wage to an optimum of 7 thousand per quarter how did that take place um they just changed the rules in.
2021 versus since the chaos of the pandemic so they wanted 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 after that what takes place 21 000 Max in 2021 oh that’s how you come up with twenty 6 thousand twenty one thousand to twenty twenty one plus five thousand in twenty twenty that’s twenty six thousand dollars per employee 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 on average Kevin is if you took PPP money 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 employees and you took PPP cash you would still get a million dollar in the mail from the internal revenue service so it’s big clearly now the big concern is why does nobody understand about this due to the fact that look when I initially heard about this when I first fulfilled Josh you understand I have actually got great deals of financial investments in great deals of companies I’m a major advocate for entrepreneurship in America and make numerous numerous financial investments in business owners of which many suffered through the pandemic when I first heard about this I called BS I do not think 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 utilized them wisely to stay alive during the pandemic so when I found out about this I said nah it can’t hold true however when I dug around I even called to my politician pals Guv Senators they didn’t learn about it I imply 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 due to the fact that you took the PPP also not true so let’s ask Josh why does nobody learn about the employee retention credit you know what’s interesting you’re discussing the banks Kevin since 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 big 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 just process procedure that’s all um and here there was mayhem because remember in the initial cares act you might 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 federal government never ever made it clear to any person about how to.
do this does your CFO know how to do this not actually she or he’s never ever done it previously do the banks do it nope the banks don’t do it the payroll companies yeah a few of them are doing it as a payroll business your accountant no your accounting professional’s never done this before unless you have an account that entered into this business and bottom line my company Kevin has actually stayed in business since 2009 and we’ve been working with the federal government and the state government to recuperate money for Fortune 500 Fortune 1000 companies so a great deal of our big huge corporate customers have actually dealt with bottom line to recover other government programs we have actually done sales tax and utilize tax unemployment tax work chance tax credits research and development tax credits unclaimed home property tax all of these other federal government programs.
The worker retention tax credit is a broad based refundable tax credit created to encourage.
companies to keep employees on their payroll. The credit is 50% of approximately $10,000 in wages paid by an.
Because of COVID-19 or whose gross invoices, company whose business is fully or partly suspended.
decline by more than 50%.
1. The credit is readily available to all employers despite size consisting of tax exempt organizations. There are.
just 2 exceptions: (1) state and city governments and their instrumentalities and (2) little.
services who take Small Business Loans.
2. To certify, the company needs to meet one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the company’s organization is fully or partly suspended by 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. When the.
company’s gross receipts go above 80% of an equivalent quarter in 2019 they no longer qualify.
after the end of that quarter.
Computation of the Credit.
The amount of the credit is 50% of the certifying salaries paid up to $10,000 in overall.
It is effective for salaries paid after March 13th and before December 31, 2020.
The definition of certifying incomes differs by whether a company had, typically, basically than.
100 workers in 2019.
Companies that focus on ERC filing assistance normally supply competence and assistance to assist services browse the intricate process of claiming the credit. They can offer various services, consisting of:.
How is the employee retention credit calculated? Texas Employee Retention Credit
Eligibility Assessment: These companies will examine your business’s eligibility for the ERC based on elements such as your market, income, and operations. They can help identify if you fulfill the requirements for the credit and recognize the maximum credit amount you can claim.
Documentation and Estimation: ERC filing services will assist in collecting the necessary documents, such as payroll records and financial statements, to support your claim. They will likewise assist determine the credit amount based on eligible salaries and other qualifying costs.
Retroactive Claim Evaluation: If you are qualified to claim the ERC for previous quarters, these business can evaluate your past payroll records and financials to identify possible opportunities for retroactive credits. They can assist you modify prior income tax return to claim these refunds.
Filing Help: Companies concentrating on ERC filings will prepare and submit the necessary forms and paperwork in your place. This consists of completing Type 941 or any other necessary tax return.
Compliance and Updates: ERC policies and assistance have developed with time. These business stay upgraded with the most recent modifications and guarantee that your filings adhere to the most present guidelines. They can likewise provide ongoing assistance if the internal revenue service requests extra info or conducts an audit related to your ERC claim.
It is necessary to research study and veterinarian any company using ERC filing help to guarantee their credibility and competence. Search for recognized firms with experience in tax and payroll services, or think about connecting to relied on accounting firms or tax specialists who use ERC submitting assistance.
Keep in mind that while these business can supply valuable support, it’s always a great concept to have a basic understanding of the ERC requirements and process yourself. This will help you make notified choices and make sure precise filings.
The Employee Retention Credit (ERC) is a refundable tax credit presented by the U.S. government as part of COVID-19 relief steps. The goal of the ERC is to encourage organizations to retain and pay their employees during the pandemic, even if their operations have been affected.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is offered to eligible companies, consisting of for-profit services, tax-exempt companies, and particular governmental entities. To qualify, companies should fulfill one of two criteria:.
Business operations were fully or partially suspended due to a government order related to COVID-19.
The business experienced a significant decline in gross invoices. As discussed earlier, for 2021, a significant decline is specified as a 20% decline in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a considerable decrease is defined as a 20% decline in gross receipts compared to the same quarter in 2019, or a 20% decline in gross receipts 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 amounts to a portion (approximately 70%) of certified earnings paid to staff members, consisting of certain health insurance costs. 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, businesses that got an Income Defense 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 incomes can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has actually been retroactively broadened and improved, permitting qualified employers to declare the credit for certified earnings paid as far back as March 13, 2020. This retroactive provision offers an opportunity for businesses to modify prior-year income tax return and get refunds.
Declaring the Credit: Employers can declare the ERC by reporting it on their employment tax returns, normally Form 941. If the credit goes beyond the amount of work taxes owed, the excess can be refunded to the company.
It is necessary to note that the ERC arrangements and eligibility criteria have actually progressed in time. The best course of action is to seek advice from a tax professional or go to the main IRS site for the most detailed and updated information concerning the ERC, consisting of any recent legal modifications or updates.
To qualify for the ERC, an organization needs to satisfy one of the following requirements:.
The business operations were completely or partially suspended due to a federal government order related to COVID-19.
Business experienced a considerable decline in gross invoices. For 2021, a considerable decline is specified as a 20% decrease in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a significant decrease is defined as a 20% decrease in gross invoices compared to the same quarter in 2019, or a 20% decrease in gross receipts compared to the right away preceding quarter.
The ERC is readily available to services of all sizes, consisting of tax-exempt companies, however there are some exceptions. Government entities and organizations that received a PPP loan may have restrictions on declaring the credit.
The process for claiming the ERC involves completing the necessary kinds and including the credit on your work income tax return (generally Form 941). The exact time it takes to process the credit can differ based on a number of factors, including the complexity of your organization and the workload of the internal revenue service. It’s suggested to seek advice from a tax expert for assistance specific to your scenario.
There are several companies that can help with the process of declaring the ERC. Some well-known business that use help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the info offered here is based on general knowledge and might not reflect the most current updates or modifications to the ERC. It is necessary to consult with a tax professional or go to the official internal revenue service site for the most updated and accurate information concerning eligibility, claiming procedures, and readily available assistance.
Less than 100. If the employer had 100 or fewer staff members typically in 2019, then the credit is based.
on salaries paid to all workers whether they actually worked or not. Simply put, even if the.
staff members worked full-time and got paid for full time work, the company still gets the credit.
Greater than 100. If the employer had more than 100 employees on average in 2019, then the credit is.
permitted only for incomes paid to workers who did not work throughout the calendar quarter.
In both cases, “incomes” consists of not just money payments however also a part of the cost of employer.
offered healthcare. Texas Employee Retention Credit
Employers can be instantly compensated for the credit by lowering the amount of payroll taxes they.