Lets talk first about Employee Retention Credit 2021 3Rd And 4Th Quarter :
Our group here what do these men doing everyone in this room is assisting teach people about ERC and uh always provide a beautiful breakfast and have individuals actually discover the program we ought to head to the space where we are able to display some of the checks that we are getting for business and I ‘d like to see that what is this this is uh numerous countless dollars literally Kevin numerous countless 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 some of these here I mean this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I imply it’s simply I suggest think of the number of real clients 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 verified and the check is on the mail in the mail from the IRS heading to the consumer so that’s how you have the ability to track it you know when you
get this you understand the check is chosen sure and that’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 confirmed the check is on the way they transfer it into their bank account and they can really trust Wonder trust that the procedure has actually been finished and how many you believe you’ve processed given that you began this we’re about 35 000 of these for
about 6 billion dollars wow so plainly they know what they’re doing which’s what you require you need 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 talking about something actually crucial today the worker retention credit which most of you have actually never heard of I definitely had not heard of it up until very recently and found out a lot about it since this is most likely the lowest cost of capital for any small company anywhere
anytime if you have workers in between five 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 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 just call up your bank manager and say provide me a loan it doesn’t 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 enjoy this program it’s going away soon you got to find out all about it let’s talk worker retention credit Josh Fox what is an ERC let’s just start there so during the Trump Administration when President Trump was enacted they developed the cares Act and the cares act provided services 3 opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically 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.
correct the cash money payroll tax refund alright go on sorry I just have to make sure we got that point I imply that’s a big distinction a loan versus money cash I like cash cash that’s what we’re discussing 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 original cares Act is the ERC and yes Kevin it is a stunning tough check in the mail where you get actual cash from the IRS all right so let’s speak about how it works because it sounds like to me if it’s a if it’s worker retention credit that person had to be a worker so I’m going to make the Presumption this cash is not for the owner not for people on the cap table not for shareholders it’s for employees right you needed to have owned a service however it’s based upon you having W-2 workers in America not 10.99. so as long as you had W-2 staff members and you paid federal payroll taxes that’s why you would be eligible so you need to be on payroll in 2020 on the W-2 and you need to be on payroll for the very first six months of 2021 on the W-2 right so there were 6 quarters the program was open well walk us through the six quarters so you had quarters two 3 and four of 2020 and you had quarters one two and 3 of 2021. all right so that’s how it’s determined you need to be on the W-2 during 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 6 quarters so the computation in 2020 to be specific Kevin is 50 of the worker’s wage to an optimum of five thousand dollars per worker for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the employee’s income to an optimum of seven thousand per quarter how did that occur um they simply altered the rules in.
2021 versus since 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 as much as 5 thousand Max and then what takes place 21 000 Max in 2021 oh that’s how you come up with twenty six thousand twenty one thousand to twenty twenty one plus five thousand in twenty twenty that’s twenty six thousand dollars per employee that is since that’s a great deal of money 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 lower the 26 000 so what we’re seeing usually Kevin is if you took PPP cash somewhere around 10 thousand dollars a person so let’s state hypothetically you owned a dining establishment in New York City where I’m from and you had a hundred employees and you took PPP cash you would still get a million dollar in the mail from the IRS so it’s substantial undoubtedly now the big question is why does nobody know about this since look when I initially heard about this when I first satisfied Josh you understand I have actually got lots of investments in great deals of business I’m a significant supporter for entrepreneurship in America and make numerous lots of financial investments in entrepreneurs of which numerous suffered through the pandemic when I first heard about this I called BS I do not believe 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 and that were well been worthy of and we utilized them sensibly to stay alive throughout the pandemic so when I became aware of this I said nah it can’t be true however when I dug around I even called to my politician friends Guv Senators they didn’t understand about it I indicate that’s how you understand that’s how misinformation is that there’s no info out there then a bunch of people told me well you can’t get it because you took the PPP likewise not real so let’s ask Josh why does no one learn about the worker retention credit you know what’s intriguing you’re talking about the banks Kevin since in the PPP loan procedure the federal government made it extremely 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 simply procedure procedure that’s all um and here there was chaos because remember in the initial cares act you could not do both programs so if you had actually 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 since it’s not alone so you’re getting a tax refund so the government never ever made it clear to anybody about how to.
do this does your CFO understand how to do this not really he or she’s never ever done it previously do the banks do it nope the banks do not do it the payroll business yeah a few of them are doing it as a payroll company your accounting professional no your accountant’s never ever done this prior to unless you have an account that entered into this company and bottom line my firm Kevin has actually been in business considering that 2009 and we’ve been working with the federal government and the state government to recuperate money for Fortune 500 Fortune 1000 business so a great deal of our huge big business clients have actually dealt with bottom line to recuperate other government programs we have actually done sales tax and use tax unemployment tax work opportunity tax credits research and development tax credits unclaimed home real estate tax all of these other government programs.
The employee retention tax credit is a broad based refundable tax credit created to encourage.
employers to keep employees on their payroll. The credit is 50% of up to $10,000 in earnings paid by an.
company whose company is completely or partially suspended because of COVID-19 or whose gross receipts.
decrease by more than 50%.
1. The credit is readily available to all employers despite size including tax exempt organizations. There are.
just 2 exceptions: (1) state and city governments and their instrumentalities and (2) little.
companies who take Small company Loans.
2. To qualify, the company needs to satisfy one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the employer’s service is completely 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 equivalent quarter in 2019. As soon as the.
company’s gross invoices exceed 80% of a similar quarter in 2019 they no longer qualify.
after the end of that quarter.
Calculation of the Credit.
The quantity of the credit is 50% of the certifying earnings paid up to $10,000 in total.
It works for salaries paid after March 13th and prior to December 31, 2020.
The meaning of qualifying salaries varies by whether a company had, typically, more or less than.
100 staff members in 2019.
Business that specialize in ERC filing assistance normally supply know-how and support to assist companies navigate the intricate procedure of claiming the credit. They can use numerous services, including:.
How is the employee retention credit calculated? Employee Retention Credit 2021 3Rd And 4Th Quarter
Eligibility Assessment: These companies will assess your service’s eligibility for the ERC based upon factors such as your market, profits, and operations. They can help identify if you meet the requirements for the credit and identify the maximum credit quantity you can declare.
Documentation and Estimation: ERC filing services will help in collecting the necessary documentation, such as payroll records and financial statements, to support your claim. They will also help calculate the credit quantity based on qualified salaries and other certifying expenses.
Retroactive Claim Review: If you are eligible to declare the ERC for prior quarters, these business can examine your previous payroll records and financials to recognize prospective chances for retroactive credits. They can help you amend prior income tax return to declare these refunds.
Filing Support: Companies specializing in ERC filings will prepare and send the needed forms and documentation on your behalf. This includes finishing Kind 941 or any other required tax forms.
Compliance and Updates: ERC policies and guidance have actually evolved with time. These companies stay updated with the most recent changes and guarantee that your filings adhere to the most existing standards. If the Internal revenue service requests additional details or conducts an audit associated to your ERC claim, they can also provide continuous assistance.
It is essential to research and veterinarian any business offering ERC filing support to ensure their credibility and proficiency. Look for recognized firms with experience in tax and payroll services, or consider connecting to trusted accounting companies or tax specialists who offer ERC filing assistance.
Bear in mind that while these business can provide valuable support, it’s constantly a good concept to have a basic understanding of the ERC requirements and procedure yourself. This will assist you make informed choices and make sure precise filings.
The Staff Member 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 services to keep and pay their staff members during the pandemic, even if their operations have been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is offered to qualified companies, including for-profit businesses, tax-exempt organizations, and certain governmental entities. To qualify, employers need to meet one of two criteria:.
The business operations were totally or partially suspended due to a federal government order related to COVID-19.
Business experienced a considerable decline in gross invoices. As pointed out previously, for 2021, a substantial decline is specified as a 20% decrease in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a substantial decrease is specified as a 20% decrease in gross invoices compared to the very 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 employer’s share of Social Security taxes. The credit quantity amounts to a portion (approximately 70%) of certified incomes paid to employees, consisting of certain health plan expenditures. 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, businesses that received a Paycheck Protection Program (PPP) loan were not eligible for the ERC. However, legislation passed in late 2020 and extended in 2021 allows businesses to claim the ERC even if they got 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 improved, permitting qualified companies to claim the credit for certified earnings paid as far back as March 13, 2020. This retroactive provision offers an opportunity for businesses to amend prior-year tax returns 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 refunded to the company if the credit exceeds the amount of work taxes owed.
It is essential to keep in mind that the ERC provisions and eligibility criteria have actually evolved in time. The best strategy is to speak with a tax expert or visit the official internal revenue service website for the most up-to-date and comprehensive information regarding the ERC, including any recent legal changes or updates.
To receive the ERC, a company should satisfy among the following criteria:.
Business operations were totally or partially suspended due to a government order related to COVID-19.
Business experienced a significant decrease in gross invoices. For 2021, a considerable decline is specified as a 20% decrease in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a considerable decline is specified as a 20% decrease in gross invoices compared to the exact same quarter in 2019, or a 20% decline in gross receipts compared to the instantly preceding quarter.
The ERC is readily available to services of all sizes, including tax-exempt companies, but there are some exceptions. Federal government entities and organizations that received a PPP loan may have restrictions on declaring the credit.
The process for declaring the ERC includes finishing the essential types and including the credit on your work tax return (generally Kind 941). The exact time it takes to process the credit can vary based on numerous aspects, consisting of the complexity of your business and the work of the internal revenue service. It’s suggested to consult with a tax professional for assistance specific to your circumstance.
There are a number of companies that can help with the process of claiming the ERC. Some well-known companies that offer help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the information supplied here is based upon general understanding and may not reflect the most current updates or modifications to the ERC. It is necessary to seek advice from a tax expert or visit the main IRS site for the most precise and up-to-date details regarding eligibility, declaring treatments, and available help.
Less than 100. The credit is based if the employer had 100 or less employees on average in 2019.
on wages paid to all staff members whether they actually worked or not. In other words, even if the.
employees worked full-time and made money for full time work, the company still gets the credit.
Greater than 100. The credit is if the employer had more than 100 employees on average in 2019.
enabled just for salaries paid to employees who did not work during the calendar quarter.
In both cases, “salaries” includes not simply cash payments however likewise a part of the expense of company.
provided health care. Employee Retention Credit 2021 3Rd And 4Th Quarter
Companies can be instantly compensated for the credit by decreasing the quantity of payroll taxes they.