Lets talk first about Employee Retention Credit 2021 Nonprofit :
Our group here what do these guys doing everybody in this room is helping teach people about ERC and uh always provide a stunning breakfast and have individuals truly find out about the program we need to head to the space where we are able to display some of the checks that we are getting for companies and I wish to see that what is this this is uh hundreds of millions of dollars literally Kevin hundreds of millions of dollars so these are replicate copies of the letters that go to clients validating that the check is on the way I indicate you know if you simply start to look at a few of these here I suggest this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I mean it’s just I imply 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 verified the numbers are confirmed 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
receive this you understand the check is opted for sure which’s when they pay so they do not pay anything until they really receive the money they don’t pay bottom line Wonder trust anything till this letter is verified the check is on the way they transfer it into their checking account and they can really rely on Wonder trust that the process has actually been completed and how many you think you’ve processed because you started 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 require you need professionals 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 Wonderful here you’re at my YouTube channel we’re speaking about something truly crucial today the employee retention credit which the majority of you have actually never heard of I certainly hadn’t heard of it until extremely recently and found out a lot about it because this is most likely the most affordable cost of capital for any small company anywhere
anytime if you have employees between 5 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 Concepts they’re the biggest processor of these ERC credits this is a 170 page program so it’s hard this isn’t like PPP we simply contact your bank supervisor and state offer 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 spokesperson for this I like this program it’s going away soon you got to find out all about it let’s talk employee retention credit Josh Fox what is an ERC let’s simply 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 nearly everyone it makes a big difference right there 2 of them are loans and one’s a refund exactly so the ERC is a refund that’s.
remedy the cash money payroll tax refund all right go on sorry I just have to make sure we got that point I suggest that’s a huge difference a loan versus cash cash I like money cash that’s what we’re discussing okay 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 due to the fact that it seems like to me if it’s a if it’s employee retention credit that person had to be a staff member so I’m going to make the Assumption this cash is not for the owner not for individuals on the cap table not for shareholders it’s for employees right you had to have actually owned a company but it’s based upon you having W-2 staff members in America not 10.99. 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 have to be on payroll for the very first 6 months of 2021 on the W-2 right so there were 6 quarters the program was open well stroll us through the 6 quarters so you had quarters two 3 and 4 of 2020 and you had quarters one two and 3 of 2021. okay so that’s how it’s measured you need to be on the W-2 during that duration now let’s talk my favorite part cash just how much can you get back per worker that was on a W-2 in those six quarters so the estimation in 2020 to be precise Kevin is 50 of the staff member’s income to a maximum of five thousand dollars per worker for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the worker’s income to an optimum of 7 thousand per quarter how did that take place um they just changed the rules in.
2021 versus because the turmoil of the pandemic so they wished 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 as much as five thousand Max and after that what takes place 21 000 Max in 2021 oh that’s how you come up with twenty 6 thousand twenty one thousand to twenty twenty one plus five thousand in twenty twenty that’s twenty 6 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 six thousand dollars so if you took PPP loan one and PPP loan 2 you would decrease the 26 000 so what we’re seeing on average Kevin is if you took PPP cash someplace around ten thousand dollars a person so let’s state hypothetically you owned a restaurant 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 substantial obviously now the big question is why does no one understand about this since appearance when I first found out about this when I first met Josh you know I have actually got lots of investments in great deals of business I’m a significant advocate for entrepreneurship in America and make numerous many financial investments in entrepreneurs of which numerous suffered through the pandemic when I initially found out about this I called BS I do not believe it due to the fact that I use the PPP we went through the money 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 been worthy of and we used them wisely to survive 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 contacted us to my political leader buddies Governor Senators they didn’t understand about it I imply that’s how you know that’s how misinformation is that there’s no information out there then a bunch of people told me well you can’t get it since you took the PPP also not real so let’s ask Josh why does no one learn about the staff member retention credit you know what’s fascinating you’re talking about the banks Kevin because 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 process in Canada a pre-pp loan there’s no loans in Canada by the way it’s simply process process that’s all um and here there was chaos due to the fact that keep in mind in the original cares act you might not do both programs so if you had actually done PPP you could refrain from doing ERC in the original program and when they altered 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 ever made it clear to anyone about how to.
do this does your CFO know how to do this not truly she or he’s never ever done it previously do the banks do it nope the banks do not do it the payroll companies yeah some of them are doing it as a payroll business your accounting professional no your accounting professional’s never done this prior to unless you have an account that entered into this organization and bottom line my company Kevin has actually been in business because 2009 and we’ve been dealing with the federal government and the state government to recover cash for Fortune 500 Fortune 1000 companies so a great deal of our huge huge business 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 property real estate tax all of these other federal government programs.
The staff member retention tax credit is a broad based refundable tax credit created to motivate.
employers to keep employees on their payroll. The credit is 50% of approximately $10,000 in incomes paid by an.
employer whose business is completely or partly suspended because of COVID-19 or whose gross invoices.
decrease by more than 50%.
1. The credit is readily available to all employers no matter size including tax exempt organizations. There are.
just two exceptions: (1) state and local governments and their instrumentalities and (2) small.
businesses who take Small company Loans.
2. To qualify, the company has to satisfy one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the employer’s service is fully or partly 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 equivalent quarter in 2019. When the.
company’s gross invoices exceed 80% of an equivalent quarter in 2019 they no longer qualify.
after the end 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 before December 31, 2020.
The meaning of certifying earnings differs by whether an employer had, on average, basically than.
100 workers in 2019.
Business that specialize in ERC filing assistance normally offer knowledge and support to assist businesses navigate the complicated procedure of declaring the credit. They can provide numerous services, including:.
How is the employee retention credit calculated? Employee Retention Credit 2021 Nonprofit
Eligibility Assessment: These companies will assess your service’s eligibility for the ERC based on elements such as your market, revenue, and operations. If you fulfill the requirements for the credit and recognize the maximum credit quantity you can declare, they can help determine.
Documentation and Estimation: ERC filing services will help in gathering the needed paperwork, such as payroll records and financial declarations, to support your claim. They will also help calculate the credit amount based upon eligible earnings and other qualifying expenditures.
Retroactive Claim Review: If you are qualified to declare the ERC for prior quarters, these companies can examine your past payroll records and financials to recognize potential opportunities for retroactive credits. They can help you change prior income tax return to claim these refunds.
Filing Support: Companies specializing in ERC filings will prepare and send the required forms and paperwork on your behalf. This consists of finishing Form 941 or any other necessary tax forms.
Compliance and Updates: ERC guidelines and assistance have actually developed gradually. These business remain updated with the most recent changes and make sure that your filings abide by the most current standards. They can likewise offer ongoing support if the internal revenue service requests extra information or conducts an audit related to your ERC claim.
It is necessary to research and veterinarian any company using ERC filing help to guarantee their credibility and expertise. Search for recognized companies with experience in tax and payroll services, or think about connecting to relied on accounting firms or tax experts who offer ERC filing support.
Bear in mind that while these companies can offer important assistance, it’s always an excellent idea to have a standard understanding of the ERC requirements and process yourself. This will help you make informed choices and guarantee precise 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 objective of the ERC is to motivate services to retain and pay their staff members during the pandemic, even if their operations have been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is available to qualified employers, consisting of for-profit organizations, tax-exempt companies, and specific governmental entities. To qualify, employers must fulfill one of two criteria:.
Business operations were fully or partly suspended due to a federal government order related to COVID-19.
The business experienced a considerable decrease in gross invoices. As mentioned previously, for 2021, a considerable decline is specified as a 20% decrease in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a substantial decrease is defined as a 20% decline in gross invoices compared to the exact 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 employer’s share of Social Security taxes. The credit quantity amounts to a percentage (up to 70%) of certified earnings paid to workers, including certain health insurance costs. The optimum credit per employee is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, services that received a Paycheck Security Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 permits organizations to claim the ERC even if they got a PPP loan. Nevertheless, the exact same salaries 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 employers to declare the credit for qualified incomes paid as far back as March 13, 2020. This retroactive arrangement provides a chance for services to amend prior-year tax returns and receive refunds.
Declaring the Credit: Companies can declare the ERC by reporting it on their employment tax returns, generally Type 941. The excess can be reimbursed to the employer if the credit exceeds the quantity of employment taxes owed.
It is necessary to note that the ERC arrangements and eligibility criteria have actually developed in time. The best strategy is to consult with a tax professional or visit the official IRS website for the most detailed and current details concerning the ERC, including any current legal changes or updates.
To qualify for the ERC, a company needs to meet one of the following requirements:.
Business operations were totally or partially suspended due to a government order related to COVID-19.
The business experienced a considerable decrease in gross invoices. 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 invoices compared to the very same quarter in 2019, or a 20% decline in gross invoices compared to the immediately preceding quarter.
The ERC is available to companies of all sizes, including tax-exempt organizations, however there are some exceptions. Government entities and services that got a PPP loan may have limitations on declaring the credit.
The process for declaring the ERC includes finishing the necessary forms and including the credit on your employment tax return (generally Type 941). The exact time it requires to process the credit can vary based on several factors, including the complexity of your organization and the workload of the internal revenue service. It’s advised to talk to a tax professional for assistance particular to your circumstance.
There are a number of business that can help with the procedure of declaring the ERC. Some popular business that offer assistance with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the info offered here is based on general understanding and might not reflect the most recent updates or modifications to the ERC. It’s important to consult with a tax expert or go to the main internal revenue service site for the most precise and up-to-date info concerning eligibility, declaring procedures, and offered help.
Less than 100. If the employer had 100 or less workers usually in 2019, then the credit is based.
on wages paid to all staff members whether they really 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. If the company had more than 100 staff members usually in 2019, then the credit is.
enabled only for salaries paid to workers who did not work throughout the calendar quarter.
In both cases, “salaries” consists of not simply cash payments but also a part of the expense of company.
provided health care. Employee Retention Credit 2021 Nonprofit
Companies can be instantly reimbursed for the credit by reducing the quantity of payroll taxes they.