Lets talk first about Completing 941X For Employee Retention Credit :
Our group here what do these people doing everybody in this space is helping teach people about ERC and uh always offer a stunning breakfast and have individuals truly learn about the program we must head to the space where we have the ability to show some of the checks that we are getting for business and I wish to see that what is this this is uh hundreds of millions of dollars literally Kevin hundreds of countless dollars so these are duplicate copies of the letters that go to customers validating that the check is on the way I mean you understand if you just begin to look at a few of these here I imply this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I indicate it’s just I imply think of how many actual customers that went through the program yeah this is the very end this is the party at the end when the check is confirmed 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 understand the check is opted for sure which’s when they pay so they don’t pay anything till they really get the money they do not pay bottom line Wonder trust anything until this letter is validated the check is on the method they transfer it into their bank account and they can really trust Wonder trust that the process has actually been ended up and the number of you believe you have actually processed considering that you began 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 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 discussing something really crucial today the employee retention credit which the majority of you have actually never heard of I certainly had not heard of it up until very just recently and learned a lot about it because this is most likely the lowest expense of capital for any small business anywhere
anytime if you have workers between 5 and five hundred so I have actually got the specialist with me this is Josh Fox he’s the creator and CEO of bottom line Ideas they’re the biggest processor of these ERC credits this is a 170 page program so it’s not easy this isn’t like PPP we just call your bank manager and say give me a loan it doesn’t 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’ve become yes the Ambassador and paid representative for this I love this program it’s disappearing very soon you got to learn everything about it let’s talk staff member retention credit Josh Fox what is an ERC let’s simply begin there so throughout the Trump Administration when President Trump was enacted they developed the cares Act and the cares act used organizations three chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly everyone 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 money payroll tax refund fine go on sorry I simply need to ensure we got that point I mean that’s a big distinction a loan versus money cash I like cash money that’s what we’re speaking about all right 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 hard check in the mail where you get real money from the internal revenue service all right so let’s talk about how it works because it sounds like to me if it’s a if it’s employee retention credit that individual needed to be a staff member so I’m going to make the Assumption this money is not for the owner not for people on the cap table not for investors it’s for workers right you needed to have actually owned a business however it’s based on you having W-2 workers in America not 10.99. 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 first 6 months of 2021 on the W-2 correct so there were 6 quarters the program was open well stroll us through the 6 quarters so you had quarters 2 three and 4 of 2020 and you had quarters one two and 3 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 how much can you return per employee that was on a W-2 in those six quarters so the calculation in 2020 to be specific Kevin is 50 of the staff member’s income to a maximum of five thousand dollars per employee for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the worker’s wage to an optimum of seven thousand per quarter how did that happen um they just altered the rules in.
2021 versus due to the fact that the turmoil 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 five thousand Max and then what happens 21 000 Max in 2021 oh that’s how you create twenty 6 thousand twenty one thousand to twenty twenty one plus five thousand in twenty twenty that’s twenty six thousand dollars per staff member that is since that’s a great deal of money it is now there’s a caveat here the PPP money would need to be decreased from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan 2 you would reduce the 26 000 so what we’re seeing on average Kevin is if you took PPP money someplace around ten thousand dollars an individual so let’s say 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 huge certainly now the huge concern is why does no one learn about this because appearance when I first became aware of this when I initially fulfilled Josh you know I have actually got great deals of investments in lots of business I’m a major advocate for entrepreneurship in America and make numerous many financial investments in business owners of which lots of suffered through the pandemic when I first became aware of this I called BS I don’t believe it due to the fact that 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 and that were well should have and we utilized them carefully to stay alive throughout the pandemic so when I found out about this I stated nah it can’t hold true however when I dug around I even contacted us to my political leader pals Governor Senators they didn’t understand 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 individuals informed me well you can’t get it since you took the PPP likewise not real so let’s ask Josh why does nobody understand about the staff member retention credit you understand what’s interesting you’re speaking about the banks Kevin since in the PPP loan process 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 huge banks in our nation and they would process process 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 since keep in mind in the initial cares act you could not do both programs so if you had done PPP you might not do ERC in the original program and when they changed the law in 2021 the banks were refraining from doing ERC due to the fact that it’s not alone so you’re getting a tax refund so the federal government never ever made it clear to anyone 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 don’t do it the payroll companies yeah a few of them are doing it as a payroll company your accountant no your accountant’s never done this prior to unless you have an account that entered into this company and bottom line my company Kevin has stayed in business considering that 2009 and we have actually been working with the federal government and the state federal government to recuperate cash for Fortune 500 Fortune 1000 business so a lot of our big big business clients have actually worked with bottom line to recuperate other government programs we have actually done sales tax and use tax joblessness tax work chance tax credits research and development tax credits unclaimed home 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 motivate.
employers to keep employees on their payroll. The credit is 50% of as much as $10,000 in earnings paid by an.
company whose service is totally or partially suspended because of COVID-19 or whose gross invoices.
decrease by more than 50%.
1. The credit is readily available to all employers regardless of size including tax exempt organizations. There are.
just 2 exceptions: (1) state and local governments and their instrumentalities and (2) little.
businesses who take Small Business Loans.
2. To qualify, the company has to fulfill one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the employer’s business is fully or partially suspended by government order due to COVID-19.
throughout the calendar quarter or.
o the employer’s gross invoices are below 50% of the comparable quarter in 2019. When the.
company’s gross invoices go above 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 certifying wages paid up to $10,000 in total.
It works for wages paid after March 13th and prior to December 31, 2020.
The definition of qualifying wages varies by whether an employer had, on average, more or less than.
100 staff members in 2019.
Business that concentrate on ERC filing support normally offer knowledge and support to assist services browse the intricate process of claiming the credit. They can offer numerous services, consisting of:.
How is the employee retention credit calculated? Completing 941X For Employee Retention Credit
Eligibility Assessment: These business will evaluate your organization’s eligibility for the ERC based upon factors such as your industry, earnings, and operations. If you satisfy the requirements for the credit and determine the optimum credit amount you can declare, they can assist identify.
Documentation and Computation: ERC filing services will help in gathering the necessary documentation, such as payroll records and financial statements, to support your claim. They will also assist compute the credit amount based upon eligible salaries and other qualifying expenses.
Retroactive Claim Evaluation: If you are qualified to declare the ERC for previous quarters, these business can evaluate your past payroll records and financials to determine possible chances for retroactive credits. They can assist you change prior income tax return to claim these refunds.
Filing Help: Companies concentrating on ERC filings will prepare and send the necessary forms and paperwork on your behalf. This consists of completing Type 941 or any other required tax forms.
Compliance and Updates: ERC regulations and guidance have actually developed over time. These business stay upgraded with the latest changes and make sure that your filings adhere to the most current guidelines. If the IRS demands additional details or conducts an audit related to your ERC claim, they can likewise provide ongoing assistance.
It is very important to research study and vet any company offering ERC filing support to guarantee their credibility and know-how. Try to find recognized companies with experience in tax and payroll services, or think about connecting to relied on accounting firms or tax specialists who provide ERC submitting support.
Remember that while these business can provide important assistance, it’s always a great concept to have a fundamental understanding of the ERC requirements and process yourself. This will help you make notified choices and make sure accurate filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief procedures. The objective of the ERC is to encourage services to keep and pay their staff members during the pandemic, even if their operations have actually been affected.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is available to eligible companies, consisting of for-profit organizations, tax-exempt organizations, and certain governmental entities. To certify, companies must meet one of two criteria:.
Business operations were completely or partly suspended due to a federal government order related to COVID-19.
The business experienced a considerable decrease in gross invoices. As discussed previously, for 2021, a significant decline is specified as a 20% decline in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a substantial decline is specified as a 20% decrease in gross receipts 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 employer’s share of Social Security taxes. The credit quantity is equal to a portion (approximately 70%) of certified earnings paid to employees, consisting of certain health insurance expenses. The optimum credit per employee is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: At first, companies that got an Income Protection Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 allows companies to declare the ERC even if they got a PPP loan. However, the very same salaries can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively expanded and boosted, allowing qualified companies to claim the credit for qualified wages paid as far back as March 13, 2020. This retroactive provision provides an opportunity for services to modify prior-year income tax return and receive refunds.
Declaring the Credit: Employers can claim the ERC by reporting it on their employment income tax return, typically Form 941. The excess can be reimbursed to the employer if the credit exceeds the amount of employment taxes owed.
It is very important to keep in mind that the ERC provisions and eligibility criteria have developed over time. The best course of action is to talk to a tax professional or visit the main internal revenue service site for the most updated and in-depth info regarding the ERC, including any recent legal changes or updates.
To qualify for the ERC, a business needs to meet among the following criteria:.
Business operations were fully or partially suspended due to a federal government order related to COVID-19.
The business experienced a considerable decrease in gross invoices. For 2021, a considerable decline is defined as a 20% decline in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a significant decline is specified as a 20% decline 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 available to businesses of all sizes, including tax-exempt companies, but there are some exceptions. For example, government entities and services that got a PPP loan might have constraints on claiming the credit.
The procedure for declaring the ERC involves completing the essential forms and including the credit on your employment tax return (typically Kind 941). The exact time it requires to process the credit can differ based on numerous aspects, consisting of the intricacy of your business and the workload of the internal revenue service. It’s suggested to talk to a tax expert for guidance particular to your circumstance.
There are numerous business that can help with the procedure of claiming the ERC. These consist of accounting companies, tax advisory services, and payroll service providers. Some widely known business that provide assistance with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s suggested to research and get in touch with these business straight to ask about their fees and services.
Please note that the information provided here is based upon general understanding and may not show the most current updates or modifications to the ERC. It is necessary to consult with a tax professional or visit the main IRS site for the most accurate and up-to-date info regarding eligibility, declaring treatments, and readily available assistance.
Less than 100. If the company had 100 or less workers usually in 2019, then the credit is based.
on earnings paid to all employees whether they really worked or not. Simply put, 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 employer had more than 100 workers on average in 2019.
permitted only for salaries paid to workers who did not work throughout the calendar quarter.
In both cases, “salaries” includes not just cash payments however likewise a portion of the cost of company.
offered healthcare. Completing 941X For Employee Retention Credit
Employers can be immediately compensated for the credit by reducing the quantity of payroll taxes they.