Lets talk first about 941-x Employee Retention Credit Status :
Our team here what do these men doing everybody in this room is assisting teach people about ERC and uh constantly supply a gorgeous breakfast and have people really discover the program we ought to head to the room where we are able to show some of the checks that we are getting for business and I wish to see that what is this this is uh numerous millions of dollars actually Kevin hundreds of millions of dollars so these are duplicate copies of the letters that go to customers validating that the check is on the way I suggest you understand if you just 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 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 celebration at the end when the check is confirmed the numbers are verified and the check is on the mail in the mail from the internal revenue service heading to the consumer 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 don’t pay anything up until they actually get the cash they do not pay bottom line Wonder trust anything until 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 procedure has actually been finished and the number of you believe you have actually processed because you started this we’re about 35 000 of these for
about 6 billion dollars wow so clearly they know 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 among these that’s what matters all right Mr Fantastic here you’re at my YouTube channel we’re discussing something actually crucial today the staff member retention credit which the majority of you have actually never ever heard of I definitely hadn’t become aware of it up until really just recently and found out a lot about it due to the fact that this is probably the most affordable expense of capital for any small company anywhere
anytime if you have workers in between five and five hundred so I’ve got the specialist 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 difficult this isn’t like PPP we just contact your bank manager 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 representative for this I like this program it’s disappearing soon you got to learn everything about it let’s talk staff member retention credit Josh Fox what is an ERC let’s simply start there so throughout the Trump Administration when President Trump was enacted they developed the cares Act and the cares act provided businesses 3 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 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 all right go on sorry I simply need to make sure we got that point I mean that’s a big difference a loan versus cash cash I like cash money that’s what we’re speaking about alright 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 gorgeous tough check in the mail where you get actual money from the IRS all right so let’s speak about how it works because it seems 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 investors it’s for workers right you had to have actually owned a business however it’s based upon you having W-2 staff members in America not 10.99. 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 6 months of 2021 on the W-2 right so there were six quarters the program was open well walk us through the six quarters so you had quarters 2 3 and 4 of 2020 and you had quarters one two and three of 2021. fine so that’s how it’s measured you need to be on the W-2 during that duration now let’s talk my favorite part money just how much can you get back per employee that was on a W-2 in those 6 quarters so the calculation in 2020 to be exact Kevin is 50 of the employee’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 staff member’s income to a maximum of seven thousand per quarter how did that occur um they simply altered the rules in.
2021 versus due to the fact that 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 as much as 5 thousand Max and then 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 because that’s a lot of cash it is now there’s a caution here the PPP cash would have to be reduced from the twenty six thousand dollars so if you took PPP loan one and PPP loan two you would lower the 26 000 so what we’re seeing on average Kevin is if you took PPP cash somewhere around ten thousand dollars a person so let’s state hypothetically you owned a restaurant in New york city City where I’m from and you had a hundred workers and you took PPP money you would still get a million dollar in the mail from the IRS so it’s big clearly now the huge concern is why does no one learn about this since appearance when I initially found out about this when I initially fulfilled Josh you understand I have actually got great deals of 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 many 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 very easy to do we had our CEOs call the banks they got their loans and that were well should have and we utilized them carefully 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 political leader good friends Guv Senators they didn’t learn about it I mean that’s how you know that’s how false information is that there’s no information out there then a lot of people informed me well you can’t get it since you took the PPP also not real so let’s ask Josh why does nobody know about the staff member retention credit you know what’s intriguing you’re discussing the banks Kevin because 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 procedure procedure that’s all um and here there was mayhem due to the fact that keep in mind in the initial cares act you could refrain from doing both programs so if you had done PPP you could not do ERC in the original program and when they changed the law in 2021 the banks were not doing ERC since 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 actually she or he’s never done it before 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 went into this business and bottom line my company Kevin has actually stayed in business because 2009 and we have actually been working with the federal government and the state federal government to recover cash for Fortune 500 Fortune 1000 companies so a lot of our huge huge corporate clients have actually worked with bottom line to recover other government programs we’ve done sales tax and utilize tax joblessness tax work chance tax credits research and development tax credits unclaimed property real estate tax all of these other federal government programs.
The employee retention tax credit is a broad based refundable tax credit designed to encourage.
employers to keep staff members on their payroll. The credit is 50% of up to $10,000 in earnings paid by an.
Because of COVID-19 or whose gross invoices, company whose service is completely or partially suspended.
decline by more than 50%.
1. The credit is available to all companies despite size including tax exempt organizations. There are.
just two exceptions: (1) state and city governments and their instrumentalities and (2) small.
businesses who take Small Business Loans.
2. To qualify, the company needs to satisfy one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the employer’s business is fully or partly suspended by government order due to COVID-19.
during the calendar quarter or.
o the company’s gross receipts are listed below 50% of the similar quarter in 2019. As soon as the.
employer’s gross receipts go above 80% of an equivalent quarter in 2019 they no longer certify.
after completion of that quarter.
Estimation of the Credit.
The quantity of the credit is 50% of the certifying salaries paid up to $10,000 in total.
It works for incomes paid after March 13th and prior to December 31, 2020.
The meaning of certifying incomes varies by whether an employer had, typically, more or less than.
100 workers in 2019.
Companies that specialize in ERC filing support generally supply proficiency and assistance to help companies browse the complicated procedure of claiming the credit. They can provide numerous services, consisting of:.
How is the employee retention credit calculated? 941-x Employee Retention Credit Status
Eligibility Assessment: These business will examine your service’s eligibility for the ERC based upon aspects such as your market, revenue, and operations. If you satisfy the requirements for the credit and determine the optimum credit amount you can claim, they can assist figure out.
Documentation and Estimation: ERC filing services will assist in gathering the needed paperwork, such as payroll records and monetary statements, to support your claim. They will also assist compute the credit amount based upon eligible wages and other certifying expenses.
Retroactive Claim Review: If you are qualified to claim the ERC for previous quarters, these business can review your previous payroll records and financials to recognize possible chances for retroactive credits. They can assist you amend previous tax returns to claim these refunds.
Filing Assistance: Business specializing in ERC filings will prepare and send the essential kinds and documents on your behalf. This includes finishing Kind 941 or any other required tax return.
Compliance and Updates: ERC regulations and guidance have evolved with time. These companies remain upgraded with the current changes and make sure that your filings comply with the most current guidelines. They can also provide continuous assistance if the internal revenue service demands extra details or conducts an audit related to your ERC claim.
It is necessary to research and veterinarian any company providing ERC filing help to guarantee their reliability and expertise. Search for recognized firms with experience in tax and payroll services, or consider reaching out to relied on accounting firms or tax experts who offer ERC submitting assistance.
Keep in mind that while these business can provide valuable support, it’s constantly an excellent concept to have a basic understanding of the ERC requirements and procedure yourself. This will assist you make notified choices and make sure precise filings.
The Worker Retention Credit (ERC) is a refundable tax credit introduced by the U.S. federal government as part of COVID-19 relief steps. The objective of the ERC is to motivate businesses 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 available to qualified companies, including for-profit companies, tax-exempt organizations, and particular governmental entities. To certify, companies need to meet one of two requirements:.
The business operations were fully or partially suspended due to a government order related to COVID-19.
Business experienced a considerable decrease in gross receipts. As pointed out earlier, for 2021, a significant decline is defined as a 20% decline in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a significant decrease is defined as a 20% decline in gross receipts compared to the very same quarter in 2019, or a 20% decrease in gross invoices 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 quantity is equal to a percentage (up to 70%) of qualified earnings paid to employees, consisting of specific 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, services that received an Income Protection Program (PPP) loan were not qualified for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 permits organizations to declare the ERC even if they received a PPP loan. The exact same salaries can not be utilized to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively broadened and boosted, allowing eligible companies to declare the credit for certified salaries paid as far back as March 13, 2020. This retroactive arrangement offers a chance for organizations to modify prior-year tax returns and get refunds.
Claiming the Credit: Employers can claim the ERC by reporting it on their work tax returns, normally Kind 941. If the credit exceeds the amount of work taxes owed, the excess can be refunded to the company.
It is necessary to note that the ERC provisions and eligibility requirements have actually evolved gradually. The very best course of action is to consult with a tax professional or visit the official IRS site for the most detailed and updated information regarding the ERC, consisting of any recent legislative changes or updates.
To receive the ERC, a business should fulfill 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 substantial decline in gross receipts. For 2021, a significant decrease 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 invoices compared to the exact same quarter in 2019, or a 20% decline in gross invoices compared to the immediately preceding quarter.
The ERC is offered to services of all sizes, consisting of tax-exempt organizations, but there are some exceptions. For instance, government entities and organizations that received a PPP loan might have constraints on declaring the credit.
The procedure for claiming the ERC includes finishing the necessary types and including the credit on your work tax return (generally Type 941). The exact time it requires to process the credit can differ based upon several elements, consisting of the complexity of your company and the workload of the internal revenue service. It’s recommended to talk to a tax expert for guidance specific to your situation.
There are several business that can aid with the procedure of claiming the ERC. These consist of accounting companies, tax advisory services, and payroll company. Some widely known business that offer support with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s recommended to research study and call these business straight to ask about their fees and services.
Please note that the info provided here is based upon general understanding and may not reflect the most recent updates or modifications to the ERC. It’s important to speak with a tax expert or go to the main internal revenue service site for the most updated and accurate details regarding eligibility, claiming treatments, and available support.
Less than 100. If the employer had 100 or less employees on average in 2019, then the credit is based.
on incomes paid to all employees whether they really worked or not. Simply put, even if the.
workers worked full time and got paid for full-time work, the employer still gets the credit.
Greater than 100. If the company had more than 100 staff members on average in 2019, then the credit is.
allowed only for wages paid to staff members who did not work throughout the calendar quarter.
In both cases, “salaries” includes not just money payments however likewise a part of the cost of employer.
provided healthcare. 941-x Employee Retention Credit Status
Companies can be instantly repaid for the credit by reducing the amount of payroll taxes they.