Lets talk first about Employee Retention Credit 2021 Fourth Quarter :
Our group here what do these people doing everybody in this room is assisting teach people about ERC and uh constantly supply a lovely breakfast and have people actually learn more about the program we should 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 millions of dollars actually Kevin hundreds of millions of dollars so these are replicate copies of the letters that go to clients confirming that the check is on the way I suggest you understand if you just begin 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 suggest think of the number of actual 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 internal revenue service heading to the customer so that’s how you’re able to track it you know when you
get this you know the check is opted for sure which’s when they pay so they don’t pay anything till they in fact receive the money they don’t pay bottom line Wonder trust anything till this letter is confirmed the check is on the method they transfer it into their bank account and they can genuinely rely on Wonder trust that the process has actually been ended up and how many you think you’ve processed because you began this we have to do with 35 000 of these for
about six billion dollars wow so clearly they know 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 Wonderful here you’re at my YouTube channel we’re speaking about something actually important today the staff member retention credit which most of you have actually never ever become aware of I certainly hadn’t become aware of it until extremely recently and discovered a lot about it since this is probably the lowest cost of capital for any small company anywhere
anytime if you have workers in between five and five hundred so I’ve got the professional with me this is Josh Fox he’s the founder and CEO of bottom line Principles they’re the biggest processor of these ERC credits this is a 170 page program so it’s difficult this isn’t like PPP we just phone 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 inform all of us about it and how to get it and why I have actually become yes the Ambassador and paid spokesperson for this I love this program it’s disappearing very soon you got to discover 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 services 3 chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically everyone it makes a big difference right there two of them are loans and one’s a refund precisely so the ERC is a refund that’s.
remedy the money money payroll tax refund okay go on sorry I just need to make sure we got that point I imply that’s a huge difference a loan versus cash cash I like money 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 beautiful tough check in the mail where you get real money 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 employee retention credit that person needed to be a staff member so I’m going to make the Assumption this money is not for the owner not for individuals on the cap table not for investors it’s for workers right you needed to have actually owned a business but it’s based upon you having W-2 staff members in America not 10.99. so as long as you had W-2 employees 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 need to be on payroll for the first six 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 two 3 and 4 of 2020 and you had quarters one 2 and 3 of 2021. all right so that’s how it’s measured you have to be on the W-2 throughout that duration now let’s talk my preferred part money just how much can you return per worker that was on a W-2 in those six quarters so the calculation in 2020 to be precise Kevin is 50 of the employee’s income 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 salary to a maximum of seven thousand per quarter how did that happen um they simply altered the rules in.
2021 versus since the mayhem 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 up to five 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 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 have to be reduced from the twenty six 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 10 thousand dollars an individual so let’s state hypothetically you owned a restaurant in New york city 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 big certainly now the big question is why does nobody understand about this due to the fact that appearance when I initially found out about this when I initially satisfied Josh you know I have actually got lots of investments in lots of companies I’m a significant supporter for entrepreneurship in America and make many lots of financial investments in business owners of which lots of suffered through the pandemic when I first found out about this I called BS I don’t think it since 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 and that were well should have and we utilized them wisely to stay alive throughout the pandemic so when I became aware of this I stated nah it can’t be true but 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 know that’s how false information is that there’s no details out there then a bunch of individuals told me well you can’t get it due to the fact that you took the PPP likewise not true so let’s ask Josh why does nobody know about the worker retention credit you understand what’s intriguing you’re talking about the banks Kevin since in the PPP loan process 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 huge banks in our country and they would process procedure in Canada a pre-pp loan there’s no loans in Canada by the way it’s simply procedure process that’s all um and here there was chaos since keep in mind 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 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 understand how to do this not truly she or he’s never done it previously 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 accounting professional’s never done this before unless you have an account that entered into this organization and bottom line my company Kevin has been in business considering that 2009 and we have actually been working with the federal government and the state federal government to recover cash for Fortune 500 Fortune 1000 business so a great deal of our big huge corporate customers have dealt with bottom line to recuperate other government programs we’ve done sales tax and utilize tax joblessness tax work chance 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 employees on their payroll. The credit is 50% of approximately $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%.
Availability.
1. The credit is readily available to all companies regardless of size including tax exempt companies. There are.
only 2 exceptions: (1) state and local governments and their instrumentalities and (2) little.
companies who take Small Business Loans.
2. To qualify, the company needs to meet one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the company’s organization is completely or partly suspended by government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross invoices are below 50% of the comparable quarter in 2019. As soon as the.
company’s gross invoices exceed 80% of a similar quarter in 2019 they no longer qualify.
after completion of that quarter.
Estimation of the Credit.
The quantity of the credit is 50% of the qualifying incomes paid up to $10,000 in overall.
It works for wages paid after March 13th and prior to December 31, 2020.
The meaning of qualifying salaries differs by whether a company had, usually, more or less than.
100 employees in 2019.
Business that focus on ERC filing support normally supply expertise and assistance to help services browse the complicated procedure of declaring the credit. They can provide different services, including:.
How is the employee retention credit calculated? Employee Retention Credit 2021 Fourth Quarter
Eligibility Evaluation: These business will assess your company’s eligibility for the ERC based on factors such as your industry, profits, and operations. If you fulfill the requirements for the credit and determine the maximum credit amount you can declare, they can assist figure out.
Documentation and Computation: ERC filing services will help in gathering the required documentation, such as payroll records and financial statements, to support your claim. They will likewise help compute the credit amount based upon eligible incomes and other certifying expenditures.
Retroactive Claim Review: If you are qualified to claim the ERC for previous quarters, these business can evaluate your previous payroll records and financials to identify possible opportunities for retroactive credits. They can help you change prior tax returns to declare these refunds.
Filing Help: Business focusing on ERC filings will prepare and submit the essential forms and paperwork in your place. This consists of finishing Type 941 or any other necessary tax return.
Compliance and Updates: ERC policies and guidance have evolved in time. These companies remain updated with the latest modifications and guarantee that your filings adhere to the most current guidelines. They can also supply continuous support if the internal revenue service demands additional details or carries out an audit related to your ERC claim.
It’s important to research and vet any business using ERC filing assistance to ensure their credibility and competence. Look for established companies with experience in tax and payroll services, or consider reaching out to relied on accounting companies or tax experts who provide ERC submitting support.
Keep in mind that while these business can provide important help, it’s always an excellent concept to have a standard understanding of the ERC requirements and procedure yourself. This will assist you make informed choices and guarantee precise filings.
The Employee Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief steps. The goal of the ERC is to motivate organizations to maintain and pay their workers during the pandemic, even if their operations have been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is readily available to qualified companies, consisting of for-profit organizations, tax-exempt organizations, and particular governmental entities. To certify, companies need to satisfy one of two requirements:.
Business operations were completely or partly suspended due to a government order related to COVID-19.
Business experienced a considerable decline in gross receipts. As discussed previously, for 2021, a considerable decline is defined as a 20% decrease in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a substantial decline is defined 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 instantly preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit quantity amounts to a percentage (up to 70%) of certified salaries paid to workers, including specific health insurance costs. The optimum credit per worker is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, businesses that received a Paycheck Defense Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 enables services to declare the ERC even if they received a PPP loan. Nevertheless, the exact same incomes can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively broadened and improved, allowing qualified companies to claim the credit for qualified wages paid as far back as March 13, 2020. This retroactive arrangement supplies a chance for organizations to amend prior-year tax returns and receive refunds.
Claiming the Credit: Employers can declare the ERC by reporting it on their employment income tax return, typically Kind 941. If the credit exceeds the quantity of work taxes owed, the excess can be reimbursed to the employer.
It’s important to keep in mind that the ERC arrangements and eligibility criteria have actually developed with time. The best strategy is to speak with a tax professional or visit the main IRS site for the most up-to-date and in-depth info relating to the ERC, including any current legal modifications or updates.
To get approved for the ERC, an organization needs to satisfy 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 considerable decline in gross invoices. For 2021, a significant decrease is specified as a 20% decrease in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a substantial decline is specified as a 20% decrease in gross receipts compared to the exact same quarter in 2019, or a 20% decrease in gross receipts compared to the instantly preceding quarter.
The ERC is readily available to businesses of all sizes, including tax-exempt organizations, but there are some exceptions. Federal government entities and companies that got a PPP loan may have constraints on declaring the credit.
The procedure for declaring the ERC includes completing the essential types and including the credit on your work income tax return (generally Form 941). The exact time it requires to process the credit can vary based upon a number of aspects, consisting of the complexity of your business and the work of the IRS. It’s suggested to talk to a tax professional for guidance specific to your scenario.
There are a number of companies that can help with the process of declaring the ERC. Some widely known business that use support with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the details offered here is based upon general understanding and might not show the most recent updates or modifications to the ERC. It’s important to seek advice from a tax professional or go to the official IRS website for the most updated and precise info relating to eligibility, declaring procedures, and offered support.
Less than 100. The credit is based if the company had 100 or less workers on average in 2019.
on incomes paid to all staff members whether they actually worked or not. Simply put, even if the.
staff members worked full-time and made money for full time work, the employer still gets the credit.
Greater than 100. If the employer had more than 100 workers typically in 2019, then the credit is.
allowed only for wages paid to workers who did not work throughout the calendar quarter.
In both cases, “earnings” consists of not simply money payments but also a part of the cost of employer.
offered healthcare. Employee Retention Credit 2021 Fourth Quarter
Payment.
Companies can be right away compensated for the credit by decreasing the amount of payroll taxes they.