Lets talk first about Us Government Employee Retention Credit :
Our group here what do these guys doing everyone in this room is assisting teach individuals about ERC and uh constantly offer a beautiful breakfast and have individuals really discover the program we ought to head to the room where we have the ability to display 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 millions of dollars actually Kevin hundreds of millions of dollars so these are replicate copies of the letters that go to customers verifying that the check is on the way I indicate you understand if you simply begin to look at some of these here I imply this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I suggest it’s simply I suggest consider how many actual customers that went through the program yeah this is the very end this is the celebration at the end when the check is validated 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’re able to track it you know when you
get this you know the check is opted for sure and that’s when they pay so they do not pay anything until they really get 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 bank account and they can really trust Wonder trust that the procedure has actually been ended up and the number of you believe you have actually processed since 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 need 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 Terrific here you’re at my YouTube channel we’re discussing something really essential today the worker retention credit which the majority of you have never heard of I certainly had not heard of it up until really just recently and discovered a lot about it since this is probably the most affordable cost of capital for any small company anywhere
anytime if you have staff members between five 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 Principles they’re the biggest processor of these ERC credits this is a 170 page program so it’s difficult this isn’t like PPP we just phone 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 tell all of us about it and how to get it and why I have actually ended up being yes the Ambassador and paid representative for this I enjoy this program it’s disappearing very soon you got to discover all about it let’s talk employee retention credit Josh Fox what is an ERC let’s just begin there so during the Trump Administration when President Trump was enacted they developed the cares Act and the cares act used businesses three opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly everyone it makes a big distinction right there two of them are loans and one’s a refund precisely so the ERC is a refund that’s.
fix the money money payroll tax refund alright go on sorry I just need to make certain we got that point I suggest that’s a big distinction a loan versus cash 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 original cares Act is the ERC and yes Kevin it is a stunning 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 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 cash is not for the owner not for people on the cap table not for investors it’s for workers right you had to have owned a business however it’s based on you having W-2 staff members 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 proper so there were 6 quarters the program was open well walk us through the six quarters so you had quarters two 3 and 4 of 2020 and you had quarters one 2 and 3 of 2021. okay so that’s how it’s determined you have to be on the W-2 during that duration now let’s talk my preferred part cash how much can you return per staff member that was on a W-2 in those six quarters so the estimation in 2020 to be specific 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 skyrocketed to 70 of the worker’s income to an optimum of 7 thousand per quarter how did that occur um they just altered the rules in.
2021 versus since the turmoil of the pandemic so they wanted 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 takes place 21 000 Max in 2021 oh that’s how you come up with twenty six thousand twenty one thousand to twenty twenty one plus five thousand in twenty twenty that’s twenty six thousand dollars per worker that is because that’s a great deal of money it is now there’s a caution here the PPP cash would need to be reduced from the twenty 6 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 ten thousand dollars a person so let’s state hypothetically you owned a dining establishment in New york city City where I’m from and you had a hundred staff members and you took PPP money you would still get a million dollar in the mail from the internal revenue service so it’s big undoubtedly now the big question is why does nobody understand about this since look when I initially found out about this when I initially met Josh you understand I’ve got lots of financial investments in great deals of business I’m a significant supporter for entrepreneurship in America and make lots of numerous investments in entrepreneurs of which lots of suffered through the pandemic when I initially became aware of this I called BS I don’t think it due to the fact that 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 and that were well should have and we used them wisely to stay alive throughout the pandemic so when I heard about this I said nah it can’t be true however when I dug around I even called to my politician good friends Governor Senators they didn’t learn about it I imply that’s how you understand that’s how false information is that there’s no details out there then a bunch of people informed me well you can’t get it because you took the PPP also not real so let’s ask Josh why does no one know about the worker retention credit you understand what’s interesting 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 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 simply process procedure that’s all um and here there was chaos because keep in mind in the initial cares act you might refrain from doing both programs so if you had 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 made it clear to anybody about how to.
do this does your CFO know how to do this not actually she or he’s never ever done it before do the banks do it nope the banks do not 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 prior to unless you have an account that went into this company and bottom line my firm Kevin has stayed in business because 2009 and we have actually been dealing with the federal government and the state federal government to recuperate cash for Fortune 500 Fortune 1000 companies so a lot of our huge big business customers have actually worked 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 property real estate tax all of these other federal government programs.
The staff member retention tax credit is a broad based refundable tax credit developed to encourage.
companies to keep employees on their payroll. The credit is 50% of up to $10,000 in incomes paid by an.
employer whose service is totally or partially suspended because of COVID-19 or whose gross receipts.
decline by more than 50%.
1. The credit is available to all employers despite size including tax exempt companies. There are.
only two exceptions: (1) state and local governments and their instrumentalities and (2) small.
companies who take Small Business Loans.
2. To qualify, the company has to meet one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the company’s organization is fully 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 equivalent quarter in 2019. As soon as the.
employer’s gross invoices go above 80% of an equivalent quarter in 2019 they no longer certify.
after the end of that quarter.
Calculation of the Credit.
The amount of the credit is 50% of the certifying incomes paid up to $10,000 in total.
It is effective for salaries paid after March 13th and before December 31, 2020.
The meaning of qualifying wages differs by whether an employer had, usually, more or less than.
100 workers in 2019.
Business that concentrate on ERC filing support generally supply knowledge and support to assist organizations browse the complex process of declaring the credit. They can offer different services, including:.
How is the employee retention credit calculated? Us Government Employee Retention Credit
Eligibility Evaluation: These business will evaluate your business’s eligibility for the ERC based upon elements such as your industry, profits, and operations. If you satisfy the requirements for the credit and determine the maximum credit amount you can claim, they can help identify.
Documentation and Calculation: ERC filing services will assist in gathering the essential documentation, such as payroll records and financial statements, to support your claim. They will likewise help compute the credit quantity based on qualified salaries and other qualifying costs.
Retroactive Claim Review: If you are qualified to claim the ERC for prior quarters, these business can evaluate your previous payroll records and financials to determine possible opportunities for retroactive credits. They can assist you change previous income tax return to declare these refunds.
Filing Help: Business specializing in ERC filings will prepare and send the necessary kinds and documentation in your place. This consists of completing Form 941 or any other necessary tax forms.
Compliance and Updates: ERC guidelines and guidance have actually evolved in time. These business stay upgraded with the latest changes and make sure that your filings adhere to the most present standards. They can also supply ongoing assistance if the internal revenue service demands extra information or carries out an audit related to your ERC claim.
It is very important to research and vet any company offering ERC filing assistance to ensure their credibility and expertise. Search for recognized firms with experience in tax and payroll services, or think about connecting to trusted accounting firms or tax experts who provide ERC filing assistance.
Bear in mind that while these companies can supply valuable help, it’s constantly a great concept to have a basic understanding of the ERC requirements and process yourself. This will assist you make notified choices and guarantee accurate filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit presented by the U.S. government as part of COVID-19 relief steps. The objective of the ERC is to motivate services to maintain and pay their workers throughout the pandemic, even if their operations have been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is readily available to eligible companies, including for-profit businesses, tax-exempt companies, and particular governmental entities. To certify, employers should satisfy one of two criteria:.
Business operations were completely or partially suspended due to a government order related to COVID-19.
Business experienced a substantial decline in gross invoices. As discussed previously, for 2021, a significant decrease is specified as a 20% decrease in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a considerable 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 amount amounts to a portion (approximately 70%) of certified earnings paid to employees, consisting of certain health plan expenditures. 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, companies that received a Paycheck Defense Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 allows businesses to declare the ERC even if they got a PPP loan. The exact same wages can not be utilized to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively broadened and improved, allowing qualified employers to declare the credit for qualified incomes paid as far back as March 13, 2020. This retroactive arrangement provides an opportunity for services to modify prior-year income tax return and receive refunds.
Declaring the Credit: Companies can declare the ERC by reporting it on their employment tax returns, generally Kind 941. If the credit exceeds the quantity of employment taxes owed, the excess can be refunded to the company.
It is necessary to note that the ERC arrangements and eligibility criteria have actually developed over time. The best strategy is to seek advice from a tax expert or go to the official internal revenue service site for the most up-to-date and comprehensive details relating to the ERC, consisting of any recent legislative changes or updates.
To get approved for the ERC, a company should meet one of the following requirements:.
The business operations were completely or partially suspended due to a government order related to COVID-19.
The business experienced a considerable decline in gross receipts. For 2021, a considerable decline is specified as a 20% decline in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a considerable decrease is specified as a 20% decline in gross receipts compared to the exact same quarter in 2019, or a 20% decrease in gross invoices compared to the immediately preceding quarter.
The ERC is offered to organizations of all sizes, including tax-exempt companies, however there are some exceptions. For example, government entities and businesses that got a PPP loan might have limitations on declaring the credit.
The process for declaring the ERC involves finishing the necessary forms and consisting of the credit on your work tax return (generally Kind 941). The exact time it takes to process the credit can differ based on a number of elements, consisting of the intricacy of your service and the work of the internal revenue service. It’s advised to talk to a tax professional for assistance particular to your circumstance.
There are a number of companies that can help with the process of declaring the ERC. These include accounting firms, tax advisory services, and payroll provider. Some widely known business that offer support with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s suggested to research study and contact these business straight to inquire about their charges and services.
Please keep in mind that the info provided here is based on basic knowledge and may not show the most current updates or changes to the ERC. It is necessary to consult with a tax expert or check out the main internal revenue service site for the most precise and up-to-date information regarding eligibility, claiming procedures, and available help.
Less than 100. If the company had 100 or less employees typically in 2019, then the credit is based.
on earnings paid to all employees whether they actually worked or not. In other words, even if the.
workers worked full-time and got paid for full time work, the company still gets the credit.
Greater than 100. The credit is if the company had more than 100 employees on average in 2019.
enabled just for wages paid to workers who did not work throughout the calendar quarter.
In both cases, “wages” consists of not just money payments however likewise a portion of the cost of company.
provided health care. Us Government Employee Retention Credit
Companies can be instantly repaid for the credit by decreasing the quantity of payroll taxes they.