Lets talk first about Can I Still Claim The Employee Retention Credit :
Our group here what do these men doing everybody in this room is helping teach individuals about ERC and uh always supply a stunning breakfast and have people truly learn about the program we need to head to the room where we have the ability to show some of the checks that we are getting for business and I want to see that what is this this is uh hundreds of countless dollars literally Kevin hundreds of countless dollars so these are replicate copies of the letters that go to clients validating that the check is on the method I suggest you understand if you simply start to take a look at a few of these here I indicate this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I indicate it’s simply I mean think about the number of actual 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 verified and the check is on the mail in the mail from the internal revenue service heading to the client so that’s how you’re able to track it you understand when you
get this you know the check is chosen sure and that’s when they pay so they do not pay anything till they really receive the cash they don’t pay bottom line Wonder trust anything till this letter is validated the check is on the method they transfer it into their checking account and they can truly trust Wonder trust that the process has been ended up and how many you think you have actually processed because you began this we have to do with 35 000 of these for
about 6 billion dollars wow so clearly they understand what they’re doing which’s what you need you require specialists 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 truly crucial today the worker retention credit which the majority of you have never ever heard of I definitely hadn’t heard of it up until really just recently and discovered a lot about it due to the fact that this is probably the most affordable cost of capital for any small company anywhere
anytime if you have employees between five and five hundred so I have actually got the expert with me this is Josh Fox he’s the creator 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 simply contact your bank supervisor and say give 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 become yes the Ambassador and paid spokesperson for this I like this program it’s going away soon you got to find out 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 developed the cares Act and the cares act offered services 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 huge difference right there two of them are loans and one’s a refund precisely so the ERC is a refund that’s.
fix the cash cash payroll tax refund fine go on sorry I simply need to make certain we got that point I suggest that’s a huge distinction a loan versus cash money I like money money that’s what we’re speaking 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 initial cares Act is the ERC and yes Kevin it is a gorgeous tough check in the mail where you get real cash from the internal revenue service all right so let’s speak about how it works because it sounds like to me if it’s a if it’s employee retention credit that individual had to be a staff member 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 needed to have owned a service 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 6 months of 2021 on the W-2 correct so there were six quarters the program was open well walk us through the six quarters so you had quarters 2 three and four of 2020 and you had quarters one two and three of 2021. alright so that’s how it’s measured you need to be on the W-2 throughout that duration now let’s talk my favorite part money just how much can you return per worker that was on a W-2 in those 6 quarters so the estimation in 2020 to be precise Kevin is 50 of the staff member’s salary to an optimum of five thousand dollars per staff member for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the employee’s income to an optimum of 7 thousand per quarter how did that take place um they just 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 employees 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 develop twenty 6 thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty 6 thousand dollars per staff member that is since that’s a lot of money it is now there’s a caution here the PPP cash would have to be decreased 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 say 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 IRS so it’s substantial certainly now the huge question is why does no one understand about this since look when I first found out about this when I first satisfied Josh you understand I have actually got lots of investments in lots of business I’m a major supporter for entrepreneurship in America and make lots of lots of investments in entrepreneurs of which numerous suffered through the pandemic when I initially heard about this I called BS I don’t believe it due to the fact that I utilize the PPP we went through the cash 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 stay alive throughout the pandemic so when I found out about this I stated nah it can’t be true but when I dug around I even called to my political leader pals Guv Senators they didn’t understand about it I suggest that’s how you understand that’s how false information is that there’s no info out there then a lot 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 worker retention credit you know 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 very clear that if you wanted 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 just process process that’s all um and here there was mayhem due to the fact that remember in the initial cares act you could refrain from doing both programs so if you had actually done PPP you might not do ERC in the initial program and when they changed the law in 2021 the banks were not doing ERC because it’s not alone so you’re getting a tax refund so the government never made it clear to anybody about how to.
do this does your CFO understand how to do this not actually he or she’s never ever done it in the past do the banks do it nope the banks do not do it the payroll companies yeah a few of them are doing it as a payroll business your accountant no your accountant’s never ever done this before unless you have an account that went into this business and bottom line my firm 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 business so a great deal of our big big corporate customers have dealt with bottom line to recuperate other federal government programs we have actually done sales tax and use 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 developed to motivate.
companies to keep staff members on their payroll. The credit is 50% of as much as $10,000 in earnings paid by an.
Due to the fact that of COVID-19 or whose gross invoices, employer whose service is completely or partially suspended.
decline by more than 50%.
1. The credit is offered to all companies despite size including tax exempt organizations. There are.
only 2 exceptions: (1) state and city governments and their instrumentalities and (2) little.
companies who take Small Business Loans.
2. To qualify, the company needs to satisfy one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the company’s business is completely or partly suspended by federal government order due to COVID-19.
during the calendar quarter or.
o the employer’s gross invoices are listed below 50% of the similar quarter in 2019. When the.
employer’s gross receipts go above 80% of an equivalent quarter in 2019 they no longer qualify.
after completion of that quarter.
Computation of the Credit.
The amount of the credit is 50% of the qualifying wages paid up to $10,000 in overall.
It is effective for earnings paid after March 13th and before December 31, 2020.
The meaning of certifying earnings varies by whether an employer had, usually, more or less than.
100 employees in 2019.
Companies that focus on ERC filing help generally provide expertise and support to assist services browse the intricate process of declaring the credit. They can provide different services, including:.
How is the employee retention credit calculated? Can I Still Claim The Employee Retention Credit
Eligibility Assessment: These companies will examine your organization’s eligibility for the ERC based upon aspects such as your industry, earnings, and operations. They can help figure out if you satisfy the requirements for the credit and identify the maximum credit amount you can claim.
Documentation and Estimation: ERC filing services will assist in gathering the needed documents, such as payroll records and financial statements, to support your claim. They will also assist compute the credit quantity based on eligible incomes and other qualifying expenses.
Retroactive Claim Evaluation: If you are qualified to claim the ERC for prior quarters, these companies can evaluate your previous payroll records and financials to identify possible opportunities for retroactive credits. They can assist you amend previous tax returns to declare these refunds.
Filing Assistance: Business concentrating on ERC filings will prepare and send the essential forms and documents on your behalf. This includes finishing Type 941 or any other required tax forms.
Compliance and Updates: ERC guidelines and guidance have actually progressed with time. These companies remain updated with the most recent changes and guarantee that your filings comply with the most present standards. They can also supply continuous assistance if the IRS requests additional information or performs an audit related to your ERC claim.
It is essential to research study and vet any company using ERC filing support to ensure their reliability and expertise. Try to find recognized firms with experience in tax and payroll services, or think about reaching out to relied on accounting firms or tax specialists who provide ERC submitting support.
Keep in mind that while these companies can offer valuable support, it’s constantly an excellent concept to have a basic understanding of the ERC requirements and process yourself. This will assist you make notified choices and make sure precise filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit presented by the U.S. federal government as part of COVID-19 relief measures. The goal of the ERC is to encourage businesses to keep and pay their workers during the pandemic, even if their operations have been affected.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is readily available to eligible companies, including for-profit services, tax-exempt organizations, and specific governmental entities. To certify, companies must fulfill one of two criteria:.
The business operations were completely or partly suspended due to a federal government order related to COVID-19.
The business experienced a substantial decline in gross receipts. As pointed out earlier, for 2021, a substantial decline is defined as a 20% decrease in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a considerable decline is specified as a 20% decline in gross invoices compared to the same quarter in 2019, or a 20% decrease in gross receipts 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 amount is equal to a portion (as much as 70%) of qualified salaries paid to staff members, including certain health plan expenses. The maximum credit per worker is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, organizations that got a Paycheck Security Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 enables organizations to claim the ERC even if they received a PPP loan. Nevertheless, the same incomes can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively broadened and enhanced, permitting eligible employers to declare the credit for certified wages paid as far back as March 13, 2020. This retroactive provision provides an opportunity for organizations to modify prior-year income tax return and get refunds.
Declaring the Credit: Employers can claim the ERC by reporting it on their work income tax return, typically Type 941. If the credit surpasses the quantity of work taxes owed, the excess can be refunded to the employer.
It’s important to keep in mind that the ERC arrangements and eligibility criteria have developed gradually. The very best strategy is to speak with a tax professional or visit the official IRS website for the most in-depth and up-to-date information relating to the ERC, consisting of any recent legal modifications or updates.
To qualify for the ERC, an organization must fulfill one of the following requirements:.
Business operations were fully or partly suspended due to a federal government order related to COVID-19.
The business experienced a substantial decline in gross invoices. For 2021, a substantial decrease is specified as a 20% decrease in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a substantial decrease is defined as a 20% decline in gross invoices compared to the very same quarter in 2019, or a 20% decrease in gross invoices compared to the instantly preceding quarter.
The ERC is readily available to companies of all sizes, including tax-exempt companies, however there are some exceptions. For example, government entities and services that received a PPP loan might have restrictions on claiming the credit.
The procedure for claiming the ERC includes finishing the needed forms and consisting of the credit on your work income tax return (typically Kind 941). The exact time it takes to process the credit can vary based upon numerous elements, including the intricacy of your business and the work of the internal revenue service. It’s suggested to consult with a tax professional for guidance particular to your situation.
There are several business that can help with the process of claiming the ERC. Some widely known business that use support with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the info provided here is based upon general understanding and might not show the most recent updates or changes to the ERC. It is necessary to speak with a tax expert or check out the official IRS site for the most current and accurate information relating to eligibility, claiming treatments, and offered help.
Less than 100. The credit is based if the company had 100 or less workers on average in 2019.
on wages paid to all workers whether they in fact worked or not. To put it simply, even if the.
workers worked full-time and earned money for full-time work, the company still gets the credit.
Greater than 100. If the company had more than 100 workers usually in 2019, then the credit is.
permitted just for earnings paid to staff members who did not work throughout the calendar quarter.
In both cases, “wages” consists of not just cash payments but likewise a portion of the cost of employer.
provided health care. Can I Still Claim The Employee Retention Credit
Companies can be right away reimbursed for the credit by minimizing the quantity of payroll taxes they.