Lets talk first about Employee Retention Credit Alternative Minimum Tax :
Our group here what do these guys doing everyone in this room is helping teach individuals about ERC and uh always supply a stunning breakfast and have people really discover the program we should head to the space where we are able to show some of the checks that we are getting for business and I want to see that what is this this is uh numerous millions of dollars actually Kevin numerous millions of dollars so these are duplicate copies of the letters that go to customers verifying that the check is on the method I mean you understand if you just begin to take a look at a few of these here I mean this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I mean it’s simply I indicate think about how many real clients that went through the program yeah this is the very end this is the celebration at the end when the check is validated the numbers are validated and the check is on the mail in the mail from the IRS heading to the consumer so that’s how you’re able to track it you know when you
get this you understand the check is opted for sure and that’s when they pay so they do not pay anything up until they really receive the cash they don’t pay bottom line Wonder trust anything until this letter is validated the check is on the way they transfer it into their savings account and they can genuinely rely on Wonder trust that the procedure has actually been completed and how many you believe you’ve processed considering that you started this we’re about 35 000 of these for
about six billion dollars wow so plainly they understand what they’re doing which’s what you require you need experts 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 discussing something truly important today the employee retention credit which most of you have never ever heard of I certainly had not become aware of it until extremely just recently and discovered a lot about it due to the fact that this is most likely the lowest expense of capital for any small business anywhere
anytime if you have workers in between 5 and five hundred so I’ve 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 not easy this isn’t like PPP we simply call your bank manager and state give 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’ve ended up being 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 just begin there so during the Trump Administration when President Trump was enacted they created the cares Act and the cares act provided organizations three chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and almost everyone it makes a huge difference right there two of them are loans and one’s a refund exactly so the ERC is a refund that’s.
fix the money cash payroll tax refund fine go on sorry I simply have to make sure we got that point I indicate that’s a huge difference a loan versus cash cash I like money cash that’s what we’re talking 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 real 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 individual had 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 employees right you had to have owned an organization however it’s based on you having W-2 employees 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 proper so there were six quarters the program was open well walk us through the 6 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 determined you need to be on the W-2 throughout that duration now let’s talk my favorite part cash how much can you return 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 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 an optimum of 7 thousand per quarter how did that happen um they simply altered the rules in.
2021 versus since the mayhem of the pandemic so they wished to even get more to keep those workers 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 happens 21 000 Max in 2021 oh that’s how you create twenty six thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty six thousand dollars per staff member that is because that’s a lot of cash it is now there’s a caution here the PPP cash would need to be reduced from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan 2 you would lower the 26 000 so what we’re seeing typically 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 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 obviously now the big concern is why does nobody know about this since appearance when I initially found out about this when I initially met Josh you understand I’ve got great deals of investments in lots of companies I’m a major advocate for entrepreneurship in America and make lots of many investments in entrepreneurs of which lots of suffered through the pandemic when I first heard about this I called BS I don’t believe it due to the fact that 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 deserved and we used them wisely to stay alive during the pandemic so when I heard about this I stated nah it can’t hold true however when I dug around I even contacted us to my political leader friends Guv Senators they didn’t know about it I imply that’s how you know that’s how false information is that there’s no information out there then a bunch of people informed me well you can’t get it because you took the PPP likewise not real so let’s ask Josh why does no one understand about the employee retention credit you understand what’s interesting you’re talking about the banks Kevin since in the PPP loan procedure the federal government made it very clear that if you desired 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 procedure that’s all um and here there was mayhem due to the fact that remember in the initial cares act you might refrain from doing both programs so if you had actually done PPP you might refrain from doing ERC in the initial 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 government never ever made it clear to anybody 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 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 business and bottom line my company Kevin has actually stayed in business given that 2009 and we’ve been working with the federal government and the state government to recover money for Fortune 500 Fortune 1000 business so a lot of our huge huge corporate clients have worked with bottom line to recuperate other government programs we’ve done sales tax and utilize tax joblessness tax work opportunity 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 designed to motivate.
companies to keep staff members on their payroll. The credit is 50% of approximately $10,000 in wages paid by an.
employer whose organization is totally or partly suspended because of COVID-19 or whose gross invoices.
decrease by more than 50%.
1. The credit is offered to all employers no matter size consisting of tax exempt organizations. There are.
only 2 exceptions: (1) state and local governments and their instrumentalities and (2) small.
businesses who take Small Business Loans.
2. To certify, the employer needs to satisfy one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the employer’s business is completely or partially suspended by federal government order due to COVID-19.
throughout the calendar quarter or.
o the employer’s gross receipts are listed below 50% of the equivalent quarter in 2019. When the.
company’s gross receipts go above 80% of a similar quarter in 2019 they no longer qualify.
after completion of that quarter.
Computation of the Credit.
The amount of the credit is 50% of the certifying earnings paid up to $10,000 in overall.
It is effective for incomes paid after March 13th and before December 31, 2020.
The definition of qualifying salaries differs by whether a company had, typically, more or less than.
100 workers in 2019.
Companies that specialize in ERC filing support usually offer knowledge and assistance to assist companies navigate the complicated process of claiming the credit. They can offer various services, including:.
How is the employee retention credit calculated? Employee Retention Credit Alternative Minimum Tax
Eligibility Assessment: These business will assess your company’s eligibility for the ERC based upon aspects such as your industry, income, and operations. If you satisfy the requirements for the credit and identify the maximum credit amount you can claim, they can help determine.
Documentation and Estimation: ERC filing services will help in collecting the required paperwork, such as payroll records and financial declarations, to support your claim. They will also help compute the credit quantity based on eligible salaries and other certifying costs.
Retroactive Claim Review: If you are qualified to claim the ERC for previous quarters, these companies can evaluate your past payroll records and financials to determine potential opportunities for retroactive credits. They can assist you amend previous income tax return to claim these refunds.
Filing Support: Business specializing in ERC filings will prepare and send the necessary types and paperwork on your behalf. This includes completing Type 941 or any other necessary tax return.
Compliance and Updates: ERC regulations and assistance have progressed over time. These business stay updated with the current changes and make sure that your filings comply with the most current standards. If the IRS requests additional info or carries out an audit associated to your ERC claim, they can likewise provide ongoing assistance.
It is essential to research and vet any business providing ERC filing help to guarantee their reliability and knowledge. Look for recognized companies with experience in tax and payroll services, or consider reaching out to relied on accounting companies or tax professionals who use ERC submitting assistance.
Remember that while these companies can supply important support, it’s constantly an excellent idea to have a basic understanding of the ERC requirements and process yourself. This will assist you make notified choices and guarantee precise filings.
The Worker Retention Credit (ERC) is a refundable tax credit introduced by the U.S. federal government as part of COVID-19 relief measures. The objective of the ERC is to encourage companies to retain and pay their employees 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 employers, consisting of for-profit organizations, tax-exempt organizations, and specific governmental entities. To qualify, companies need to meet one of two criteria:.
Business operations were totally or partly suspended due to a federal government order related to COVID-19.
Business experienced a substantial decrease in gross receipts. As pointed out previously, for 2021, a significant decline is defined as a 20% decrease in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a substantial decline is defined as a 20% decline in gross receipts compared to the exact same quarter in 2019, or a 20% decline in gross invoices compared to the instantly 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 percentage (up to 70%) of certified wages paid to workers, including particular health insurance expenses. The maximum 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 got an Income Security Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 enables services to declare the ERC even if they got a PPP loan. However, the same wages can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively expanded and improved, allowing qualified employers to claim the credit for certified wages paid as far back as March 13, 2020. This retroactive provision offers a chance for businesses to modify prior-year income tax return and get refunds.
Declaring the Credit: Employers can claim the ERC by reporting it on their work tax returns, typically Kind 941. If the credit goes beyond the amount of work taxes owed, the excess can be reimbursed to the employer.
It is necessary to keep in mind that the ERC arrangements and eligibility criteria have evolved over time. The very best course of action is to talk to a tax expert or check out the official internal revenue service website for the most comprehensive and up-to-date info concerning the ERC, including any current legislative modifications or updates.
To qualify for the ERC, a business needs to meet one of the following requirements:.
The business operations were fully or partly suspended due to a government order related to COVID-19.
Business experienced a significant decrease in gross invoices. For 2021, a considerable decrease is defined as a 20% decline in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a substantial decrease is defined 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 right away preceding quarter.
The ERC is offered to companies of all sizes, including tax-exempt organizations, however there are some exceptions. For example, government entities and companies that got a PPP loan might have restrictions on declaring the credit.
The procedure for claiming the ERC includes completing the essential kinds and including the credit on your work tax return (usually 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 suggested to consult with a tax expert for assistance particular to your situation.
There are several companies that can help with the procedure of claiming the ERC. These consist of accounting firms, tax advisory services, and payroll company. Some widely known business that offer assistance with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s recommended to research and call these companies directly to inquire about their costs and services.
Please keep in mind that the information supplied here is based upon basic knowledge and may not reflect the most current updates or modifications to the ERC. It is essential to consult with a tax professional or check out the official internal revenue service website for the most current and precise information regarding eligibility, declaring procedures, and available support.
Less than 100. If the employer had 100 or less staff members usually in 2019, then the credit is based.
on earnings paid to all staff members whether they actually worked or not. Simply put, even if the.
workers worked full-time and made money for full time work, the employer still gets the credit.
Greater than 100. The credit is if the employer had more than 100 staff members on average in 2019.
enabled only for incomes paid to staff members who did not work throughout the calendar quarter.
In both cases, “salaries” includes not simply money payments but likewise a portion of the cost of employer.
supplied healthcare. Employee Retention Credit Alternative Minimum Tax
Employers can be instantly repaid for the credit by decreasing the amount of payroll taxes they.