Lets talk first about Do Family Members Qualify For Employee Retention Credit :
Our group here what do these people doing everybody in this space is assisting teach individuals about ERC and uh always provide a lovely breakfast and have people truly find out about the program we should head to the room where we are able to show some of the checks that we are getting for business and I ‘d like to see that what is this this is uh hundreds of countless dollars actually Kevin numerous millions of dollars so these are duplicate copies of the letters that go to clients validating that the check is on the method I mean you know if you simply begin to 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 just I indicate consider the number of actual customers that went through the program yeah this is the very end this is the party at the end when the check is validated 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’re able to track it you understand when you
receive this you understand the check is opted for sure and that’s when they pay so they do not pay anything till they really get the money they don’t pay bottom line Wonder trust anything up until this letter is validated the check is on the method they deposit it into their bank account and they can truly rely on Wonder trust that the procedure has actually been ended up and how many you think you’ve processed considering that you started this we’re about 35 000 of these for
about six billion dollars wow so plainly they know what they’re doing which’s what you need you need professionals 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 Fantastic here you’re at my YouTube channel we’re speaking about something actually essential today the worker retention credit which the majority of you have actually never become aware of I definitely hadn’t become aware of it up until very just recently and found out a lot about it because this is probably the lowest cost of capital for any small business anywhere
anytime if you have workers in between 5 and five hundred so I’ve got the specialist with me this is Josh Fox he’s the founder and CEO of bottom line Concepts 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 offer 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 spokesperson for this I enjoy this program it’s going away very soon you got to learn everything about it let’s talk worker 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 provided businesses 3 chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly everybody it makes a huge distinction right there two of them are loans and one’s a refund precisely so the ERC is a refund that’s.
correct the cash money payroll tax refund fine go on sorry I just need to make certain we got that point I imply that’s a huge distinction a loan versus money money I like money cash 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 difficult check in the mail where you get actual cash from the internal revenue service all right so let’s speak about how it works due to the fact that it sounds like to me if it’s a if it’s staff member retention credit that person needed to be a worker so I’m going to make the Assumption this money is not for the owner not for individuals on the cap table not for shareholders it’s for workers right you had to have owned an organization however it’s based upon you having W-2 employees 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 first 6 months of 2021 on the W-2 correct so there were 6 quarters the program was open well walk us through the 6 quarters so you had quarters two 3 and four of 2020 and you had quarters one 2 and 3 of 2021. all right so that’s how it’s determined you have to be on the W-2 throughout that period now let’s talk my preferred part cash just how much can you return per worker that was on a W-2 in those six quarters so the estimation in 2020 to be specific Kevin is 50 of the employee’s salary to a maximum of five thousand dollars per staff member for the year of 2020 and in 2021 the numbers increased to 70 of the worker’s wage to a maximum of 7 thousand per quarter how did that take place um they just altered the rules in.
2021 versus because the chaos 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 up to five thousand Max and after that what happens 21 000 Max in 2021 oh that’s how you develop twenty 6 thousand twenty one thousand to twenty twenty one plus five thousand in twenty twenty that’s twenty 6 thousand dollars per worker that is because that’s a lot of cash it is now there’s a caveat here the PPP cash would need to be minimized 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 somewhere around ten thousand dollars an individual so let’s say hypothetically you owned a dining establishment in New York City where I’m from and you had a hundred staff members and you took PPP cash you would still get a million dollar in the mail from the internal revenue service so it’s big certainly now the big concern is why does no one know about this due to the fact that look when I initially heard about this when I first met Josh you know I’ve got lots of investments in great deals of companies I’m a major advocate for entrepreneurship in America and make many numerous financial investments in business owners of which numerous suffered through the pandemic when I initially found out about this I called BS I don’t believe it because 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 should have and we used them carefully to stay alive during the pandemic so when I heard about this I said nah it can’t be true but when I dug around I even contacted us to my politician pals Governor Senators they didn’t know about it I indicate that’s how you know that’s how misinformation is that there’s no info out there then a lot of people informed me well you can’t get it because you took the PPP likewise not true so let’s ask Josh why does no one understand about the staff member 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 really 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 process in Canada a pre-pp loan there’s no loans in Canada by the way it’s just procedure process that’s all um and here there was turmoil since remember 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 initial program and when they altered 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 government never made it clear to anybody about how to.
do this does your CFO know how to do this not really she or he’s never done it before 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 company your accountant no your accounting professional’s never done this prior to unless you have an account that went into this organization and bottom line my company Kevin has been in business since 2009 and we have actually been working with the federal government and the state government to recuperate money for Fortune 500 Fortune 1000 business so a lot of our huge big business customers have actually dealt with bottom line to recover other government programs we have actually done sales tax and utilize tax joblessness tax work chance tax credits research and development tax credits unclaimed home property tax all of these other federal government programs.
The staff member retention tax credit is a broad based refundable tax credit designed to motivate.
employers to keep staff members on their payroll. The credit is 50% of approximately $10,000 in earnings paid by an.
Since of COVID-19 or whose gross receipts, company whose service is totally or partly suspended.
decline by more than 50%.
Availability.
1. The credit is readily available to all companies regardless of size consisting of tax exempt organizations. There are.
only 2 exceptions: (1) state and city governments and their instrumentalities and (2) small.
organizations who take Small Business Loans.
2. To certify, the employer needs to meet one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the employer’s company is completely or partially suspended by federal government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross receipts are below 50% of the similar quarter in 2019. When the.
company’s gross invoices exceed 80% of a similar quarter in 2019 they no longer certify.
after completion of that quarter.
Computation of the Credit.
The quantity of the credit is 50% of the qualifying wages paid up to $10,000 in total.
It works for earnings paid after March 13th and before December 31, 2020.
The meaning of certifying incomes varies by whether a company had, typically, more or less than.
100 employees in 2019.
Business that concentrate on ERC filing assistance usually provide knowledge and assistance to help services browse the intricate procedure of claiming the credit. They can use various services, consisting of:.
How is the employee retention credit calculated? Do Family Members Qualify For Employee Retention Credit
Eligibility Evaluation: These companies will examine your service’s eligibility for the ERC based on elements such as your industry, revenue, and operations. They can help figure out if you satisfy the requirements for the credit and determine the maximum credit quantity you can declare.
Paperwork and Computation: ERC filing services will assist in collecting the necessary documents, such as payroll records and financial statements, to support your claim. They will also help determine the credit quantity based on eligible earnings and other certifying expenditures.
Retroactive Claim Evaluation: If you are qualified to claim the ERC for previous quarters, these companies can review your past payroll records and financials to recognize prospective opportunities for retroactive credits. They can help you change previous income tax return to claim these refunds.
Filing Help: Companies concentrating on ERC filings will prepare and send the required types and paperwork in your place. This includes completing Type 941 or any other necessary tax return.
Compliance and Updates: ERC policies and guidance have developed gradually. These companies stay upgraded with the current modifications and make sure that your filings abide by the most existing standards. If the Internal revenue service requests additional details or performs an audit related to your ERC claim, they can also supply ongoing assistance.
It is essential to research study and veterinarian any business providing ERC filing assistance to ensure their trustworthiness and expertise. Try to find recognized firms with experience in tax and payroll services, or think about connecting to relied on accounting companies or tax specialists who offer ERC filing support.
Remember that while these business can offer valuable support, it’s always a great idea to have a standard understanding of the ERC requirements and process yourself. This will help you make notified choices and guarantee accurate 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 goal of the ERC is to encourage businesses to retain and pay their employees throughout the pandemic, even if their operations have actually been affected.
Here are some key points 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 should satisfy one of two criteria:.
Business operations were totally or partially suspended due to a federal government order related to COVID-19.
The business experienced a substantial decline in gross receipts. As discussed previously, for 2021, a considerable decrease is specified as a 20% decline in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a significant decline is defined as a 20% decrease in gross invoices compared to the same quarter in 2019, or a 20% decrease in gross invoices compared to the right away preceding quarter.
Credit Amount: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit amount amounts to a portion (up to 70%) of qualified wages paid to staff members, consisting of specific health plan 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, organizations that received an Income Defense Program (PPP) loan were not eligible for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 permits businesses to claim the ERC even if they got a PPP loan. Nevertheless, the same wages can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively broadened and improved, allowing qualified employers to claim the credit for qualified earnings paid as far back as March 13, 2020. This retroactive arrangement supplies a chance for services to modify prior-year tax returns and receive refunds.
Declaring the Credit: Employers can declare the ERC by reporting it on their work income tax return, typically Kind 941. The excess can be refunded to the employer if the credit exceeds the quantity of work taxes owed.
It is very important to keep in mind that the ERC provisions and eligibility requirements have actually evolved in time. The best strategy is to consult with a tax professional or go to the main internal revenue service website for the most up-to-date and comprehensive information concerning the ERC, consisting of any current legislative changes or updates.
To qualify for the ERC, an organization should fulfill among the following requirements:.
The business operations were totally or partially suspended due to a federal government order related to COVID-19.
Business experienced a substantial decline in gross invoices. For 2021, a substantial decline is specified as a 20% decrease in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a significant decline is defined as a 20% decrease 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.
The ERC is readily available to companies of all sizes, including tax-exempt organizations, however there are some exceptions. For instance, government entities and businesses that received a PPP loan might have constraints on claiming the credit.
The process for claiming the ERC involves finishing the required forms and including the credit on your work tax return (generally Form 941). The exact time it requires to process the credit can differ based upon a number of aspects, including the intricacy of your service and the work of the internal revenue service. It’s advised to seek advice from a tax professional for assistance particular to your scenario.
There are a number of business that can help with the procedure of claiming the ERC. Some popular companies that use help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the information supplied here is based on basic knowledge and might not reflect the most current updates or changes to the ERC. It is very important to seek advice from a tax expert or check out the official internal revenue service site for the most precise and up-to-date information regarding eligibility, claiming procedures, and available support.
Less than 100. If the company had 100 or less staff members usually in 2019, then the credit is based.
on salaries paid to all workers whether they actually worked or not. Simply put, even if the.
employees worked full-time and earned money for full time work, the employer still gets the credit.
Greater than 100. The credit is if the company had more than 100 staff members on average in 2019.
permitted only for earnings paid to staff members who did not work during the calendar quarter.
In both cases, “salaries” includes not simply money payments however also a portion of the expense of company.
supplied healthcare. Do Family Members Qualify For Employee Retention Credit
Payment.
Employers can be instantly reimbursed for the credit by decreasing the amount of payroll taxes they.