Lets talk first about When Is The Deadline For The Employee Retention Credit :
Our group here what do these guys doing everyone in this room is helping teach people about ERC and uh constantly supply a lovely breakfast and have people truly learn about the program we ought to head to the room where we have the ability to display some 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 clients confirming that the check is on the method I imply you know if you just start to look at some of these here I indicate this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I mean it’s just I mean think of how many real clients that went through the program yeah this is the very end this is the celebration 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 customer so that’s how you have the ability to track it you know when you
get this you know the check is gone for sure which’s when they pay so they don’t pay anything up until they actually get the money they do not pay bottom line Wonder trust anything till this letter is validated the check is on the way they transfer it into their savings account and they can truly trust Wonder trust that the procedure has actually been completed and the number of you believe you’ve processed since you began this we’re about 35 000 of these for
about six billion dollars wow so clearly they know 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 one of these that’s what matters all right Mr Terrific here you’re at my YouTube channel we’re speaking about something actually important today the employee retention credit which most of you have actually never become aware of I definitely had not heard of it until very recently and discovered a lot about it since this is probably the lowest expense of capital for any small business anywhere
anytime if you have staff members in 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 challenging 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’ve become yes the Ambassador and paid spokesperson for this I like this program it’s disappearing very soon you got to learn all about it let’s talk staff member 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 companies three chances 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.
remedy the cash cash payroll tax refund fine go on sorry I simply have to make sure we got that point I imply that’s a big difference a loan versus money money I like cash cash that’s what we’re talking about okay 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 difficult check in the mail where you get actual money from the IRS all right so let’s discuss how it works because it seems like to me if it’s a if it’s worker retention credit that individual needed to be a staff member so I’m going to make the Presumption this cash is not for the owner not for individuals on the cap table not for investors it’s for employees right you needed to have actually owned an organization however it’s based on you having W-2 staff members in America not 10.99. so 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 very first six months of 2021 on the W-2 appropriate so there were 6 quarters the program was open well walk us through the 6 quarters so you had quarters 2 three and 4 of 2020 and you had quarters one 2 and three of 2021. fine so that’s how it’s determined you have to be on the W-2 throughout that period now let’s talk my favorite part cash how much can you return per staff member that was on a W-2 in those six quarters so the calculation in 2020 to be exact 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 employee’s wage to a maximum of seven thousand per quarter how did that occur um they just changed the rules in.
2021 versus because the turmoil 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 5 thousand Max and after that what happens 21 000 Max in 2021 oh that’s how you create 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 since that’s a great deal of cash it is now there’s a caveat here the PPP money would have to be lowered from the twenty six thousand dollars so if you took PPP loan one and PPP loan two you would minimize 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 state hypothetically you owned a restaurant in New York 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 internal revenue service so it’s big certainly now the big question is why does no one understand about this due to the fact that appearance when I initially became aware of this when I first fulfilled Josh you know I’ve got great deals of financial investments in great deals of companies I’m a significant advocate for entrepreneurship in America and make numerous many financial investments in business owners of which lots of suffered through the pandemic when I initially heard about this I called BS I don’t think it because I use the PPP we went through the money center Banks to get it it was extremely easy to do we had our CEOs call the banks they got their loans which were well been worthy of and we utilized them wisely to survive throughout the pandemic so when I became aware of this I said nah it can’t be true but when I dug around I even contacted us to my political leader pals Guv Senators they didn’t understand about it I suggest that’s how you know that’s how misinformation is that there’s no information out there then a bunch of individuals 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 no one learn about the employee retention credit you understand what’s fascinating you’re talking about the banks Kevin since in the PPP loan process the federal government made it very clear that if you desired 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 procedure procedure that’s all um and here there was mayhem due to the fact that remember in the original cares act you might refrain from doing both programs so if you had done PPP you might refrain from doing ERC in the initial program and when they altered the law in 2021 the banks were refraining from doing ERC because it’s not alone so you’re getting a tax refund so the government never ever made it clear to any person about how to.
do this does your CFO know how to do this not really he or she’s never done it before 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 business your accounting professional no your accounting professional’s never done this before unless you have an account that went into this company and bottom line my company Kevin has actually stayed in business because 2009 and we’ve 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 huge business clients have dealt 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 property property tax all of these other government programs.
The worker retention tax credit is a broad based refundable tax credit designed to motivate.
companies to keep employees on their payroll. The credit is 50% of approximately $10,000 in incomes paid by an.
Due to the fact that of COVID-19 or whose gross receipts, company whose organization is fully or partially suspended.
decrease by more than 50%.
1. The credit is offered to all companies despite size consisting of tax exempt organizations. There are.
just 2 exceptions: (1) state and city governments and their instrumentalities and (2) small.
businesses who take Small company Loans.
2. To qualify, the employer needs to satisfy one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the company’s organization is totally or partly 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 similar quarter in 2019. Once the.
employer’s gross invoices exceed 80% of a comparable quarter in 2019 they no longer certify.
after completion of that quarter.
Computation of the Credit.
The amount of the credit is 50% of the qualifying salaries paid up to $10,000 in overall.
It works for salaries paid after March 13th and prior to December 31, 2020.
The definition of qualifying incomes varies by whether a company had, typically, basically than.
100 employees in 2019.
Companies that concentrate on ERC filing help normally provide proficiency and assistance to help companies navigate the intricate process of claiming the credit. They can use numerous services, consisting of:.
How is the employee retention credit calculated? When Is The Deadline For The Employee Retention Credit
Eligibility Assessment: These companies will assess your organization’s eligibility for the ERC based upon aspects such as your market, revenue, and operations. If you meet the requirements for the credit and identify the maximum credit quantity you can declare, they can assist determine.
Paperwork and Calculation: ERC filing services will assist in gathering the required paperwork, such as payroll records and financial statements, to support your claim. They will also assist calculate the credit amount based upon eligible earnings and other certifying expenses.
Retroactive Claim Review: If you are qualified to declare the ERC for prior quarters, these companies can review your previous payroll records and financials to determine prospective chances for retroactive credits. They can assist you modify prior income tax return to declare these refunds.
Filing Assistance: Companies specializing in ERC filings will prepare and send the necessary kinds and documentation on your behalf. This consists of completing Form 941 or any other necessary tax forms.
Compliance and Updates: ERC regulations and assistance have actually developed in time. These business remain updated with the most recent changes and ensure that your filings adhere to the most present guidelines. If the Internal revenue service requests additional info or conducts an audit related to your ERC claim, they can likewise provide ongoing support.
It is necessary to research study and vet any company offering ERC filing assistance to ensure their credibility and knowledge. Search for established companies with experience in tax and payroll services, or think about reaching out to trusted accounting companies or tax professionals who provide ERC filing assistance.
Bear in mind that while these companies can provide valuable assistance, it’s constantly a good concept to have a basic understanding of the ERC requirements and process yourself. This will assist you make notified decisions and ensure 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 objective of the ERC is to motivate organizations to retain and pay their workers during the pandemic, even if their operations have actually been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is available to eligible employers, including for-profit companies, tax-exempt companies, and particular governmental entities. To certify, companies must satisfy one of two requirements:.
Business operations were fully or partly suspended due to a government order related to COVID-19.
Business experienced a considerable decrease in gross receipts. As mentioned previously, for 2021, a significant decline is defined as a 20% decrease in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a substantial decline 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 immediately preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit quantity is equal to a percentage (approximately 70%) of certified salaries paid to workers, consisting of particular 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: Initially, organizations that got an Income Defense Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 allows services to declare the ERC even if they received a PPP loan. Nevertheless, the exact same incomes can not be utilized to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively broadened and boosted, allowing eligible employers to claim the credit for qualified earnings paid as far back as March 13, 2020. This retroactive arrangement provides an opportunity for companies to change prior-year income tax return and receive refunds.
Claiming the Credit: Companies can claim the ERC by reporting it on their work tax returns, normally Form 941. If the credit goes beyond the amount of employment taxes owed, the excess can be refunded to the company.
It is necessary to note that the ERC provisions and eligibility requirements have progressed over time. The best course of action is to consult with a tax professional or check out the official internal revenue service website for the most in-depth and current information concerning the ERC, including any current legal modifications or updates.
To receive the ERC, a company needs to fulfill among the following criteria:.
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 invoices. For 2021, a substantial decline is defined as a 20% decline in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a substantial decrease is defined as a 20% decrease in gross receipts compared to the exact same quarter in 2019, or a 20% decrease in gross invoices compared to the instantly preceding quarter.
The ERC is available to services of all sizes, including tax-exempt companies, however there are some exceptions. Government entities and businesses that received a PPP loan might have restrictions on declaring the credit.
The process for claiming the ERC includes completing the necessary types and including the credit on your employment tax return (usually Type 941). The exact time it takes to process the credit can vary based on numerous factors, consisting of the intricacy of your service and the workload of the IRS. It’s suggested to seek advice from a tax professional for assistance specific to your scenario.
There are a number of business that can aid with the process of declaring the ERC. These include accounting companies, tax advisory services, and payroll service providers. Some popular business that use assistance with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s a good idea to research study and get in touch with these business directly to ask about their services and fees.
Please note that the information supplied here is based upon basic understanding and might not show the most current updates or changes to the ERC. It is essential to seek advice from a tax professional or visit the main internal revenue service website for the most accurate and current info relating to eligibility, declaring procedures, and offered help.
Less than 100. The credit is based if the company had 100 or less staff members on average in 2019.
on salaries paid to all employees whether they really worked or not. In other words, even if the.
workers worked full-time and earned money for full time work, the company still gets the credit.
Greater than 100. The credit is if the company had more than 100 workers on average in 2019.
permitted just for incomes paid to staff members who did not work during the calendar quarter.
In both cases, “salaries” consists of not simply cash payments but likewise a part of the expense of employer.
offered healthcare. When Is The Deadline For The Employee Retention Credit
Companies can be right away repaid for the credit by reducing the quantity of payroll taxes they.