Lets talk first about Employee Retention Credit Do It Yourself :
Our group here what do these guys doing everybody in this space is assisting teach individuals about ERC and uh constantly supply a lovely breakfast and have individuals really discover the program we must head to the room 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 countless dollars literally Kevin hundreds of countless dollars so these are duplicate copies of the letters that go to clients confirming that the check is on the way I mean you understand if you just begin to take a 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 imply it’s simply I mean think about the number of real 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 verified and the check is on the mail in the mail from the IRS heading to the client so that’s how you’re able to track it you know when you
receive this you know the check is gone for sure which’s when they pay so they do not pay anything until they really receive the money they do not pay bottom line Wonder trust anything up until this letter is verified the check is on the method they deposit it into their bank account and they can genuinely trust Wonder trust that the process has actually been ended up and how many you think you have actually processed because you began this we’re about 35 000 of these for
about six billion dollars wow so plainly they know 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 Terrific here you’re at my YouTube channel we’re speaking about something actually essential today the staff member retention credit which most of you have never ever heard of I certainly hadn’t heard of it until really just recently and learned a lot about it since 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’ve got the professional 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 your bank supervisor 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 all of us about it and how to get it and why I’ve ended up being yes the Ambassador and paid representative for this I like this program it’s going away very soon you got to discover everything about it let’s talk employee retention credit Josh Fox what is an ERC let’s just begin there so throughout the Trump Administration when President Trump was enacted they developed the cares Act and the cares act offered businesses three opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically everyone it makes a big distinction right there 2 of them are loans and one’s a refund precisely so the ERC is a refund that’s.
correct the cash cash payroll tax refund okay go on sorry I simply need to ensure we got that point I indicate that’s a big distinction a loan versus money cash I like money money that’s what we’re talking 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 initial cares Act is the ERC and yes Kevin it is a lovely hard check in the mail where you get real money from the IRS 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 had to be an employee so I’m going to make the Assumption this cash is not for the owner not for people on the cap table not for investors it’s for employees right you had to have actually owned a service however it’s based on you having W-2 staff members in America not 10.99. so as long as you had W-2 workers and you paid federal payroll taxes that’s why you would be qualified so you need 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 appropriate so there were 6 quarters the program was open well stroll us through the 6 quarters so you had quarters two 3 and four of 2020 and you had quarters one two and three of 2021. okay so that’s how it’s determined you have to be on the W-2 during that duration now let’s talk my preferred part cash how much can you return per employee that was on a W-2 in those six quarters so the calculation in 2020 to be exact Kevin is 50 of the worker’s salary to an optimum of five thousand dollars per worker for the year of 2020 and in 2021 the numbers escalated to 70 of the employee’s salary to a maximum of 7 thousand per quarter how did that take place um they simply changed the rules in.
2021 versus because the chaos of the pandemic so they wished 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 develop twenty 6 thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty 6 thousand dollars per staff member that is since that’s a great deal of cash it is now there’s a caution here the PPP money would have to be decreased from the twenty six thousand dollars so if you took PPP loan one and PPP loan 2 you would minimize the 26 000 so what we’re seeing typically Kevin is if you took PPP cash somewhere around ten thousand dollars a person so let’s say hypothetically you owned a restaurant in New York City where I’m from and you had a hundred staff members and you took PPP money you would still get a million dollar in the mail from the IRS so it’s huge clearly now the huge question is why does nobody understand about this since look when I initially found out about this when I initially met Josh you understand I’ve got great deals of financial investments in great deals of companies I’m a major supporter for entrepreneurship in America and make many lots of investments in entrepreneurs of which numerous suffered through the pandemic when I first became aware of 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 very easy to do we had our CEOs call the banks they got their loans which were well been worthy of and we used them wisely to stay alive during the pandemic so when I found out about this I said nah it can’t hold true however when I dug around I even called to my political leader good friends Guv Senators they didn’t know about it I mean that’s how you understand that’s how false information is that there’s no info out there then a bunch of individuals told me well you can’t get it because you took the PPP also not true so let’s ask Josh why does no one learn about the employee retention credit you know what’s interesting you’re talking about the banks Kevin due to the fact that in the PPP loan procedure 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 procedure that’s all um and here there was mayhem since keep in mind 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 original 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 anyone 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 don’t do it the payroll companies yeah some of them are doing it as a payroll company 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 firm Kevin has actually been in business because 2009 and we’ve been working with the federal government and the state government to recover cash for Fortune 500 Fortune 1000 companies so a great deal of our big big corporate clients have dealt with bottom line to recuperate other government programs we’ve done sales tax and use tax unemployment tax work opportunity tax credits research and development tax credits unclaimed property real estate tax all of these other government programs.
The worker retention tax credit is a broad based refundable tax credit designed to encourage.
companies to keep staff members on their payroll. The credit is 50% of up to $10,000 in salaries paid by an.
Due to the fact that of COVID-19 or whose gross invoices, company whose business is completely or partly suspended.
decrease by more than 50%.
Availability.
1. The credit is readily available to all employers despite size including tax exempt companies. There are.
only 2 exceptions: (1) state and city governments and their instrumentalities and (2) little.
businesses who take Small Business Loans.
2. To qualify, the employer has to fulfill 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 employer’s gross receipts are below 50% of the equivalent quarter in 2019. As soon as the.
company’s gross receipts go above 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 certifying salaries paid up to $10,000 in overall.
It works for wages paid after March 13th and before December 31, 2020.
The definition of certifying earnings varies by whether an employer had, on average, basically than.
100 employees in 2019.
Companies that concentrate on ERC filing support typically supply expertise and support to help organizations browse the complicated process of claiming the credit. They can use numerous services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit Do It Yourself
Eligibility Assessment: These business will assess your company’s eligibility for the ERC based upon aspects such as your industry, profits, and operations. They can assist identify if you satisfy the requirements for the credit and identify the optimum credit quantity you can declare.
Paperwork and Estimation: ERC filing services will help in gathering the required documentation, such as payroll records and financial declarations, to support your claim. They will also assist compute the credit quantity based upon qualified salaries and other qualifying expenses.
Retroactive Claim Evaluation: If you are eligible to claim the ERC for previous quarters, these companies can examine your previous payroll records and financials to determine possible opportunities for retroactive credits. They can assist you modify prior income tax return to claim these refunds.
Filing Help: Companies focusing on ERC filings will prepare and send the necessary forms and paperwork on your behalf. This consists of finishing Form 941 or any other required tax return.
Compliance and Updates: ERC regulations and guidance have actually progressed in time. These business stay updated with the latest modifications and guarantee that your filings adhere to the most present standards. They can also offer ongoing assistance if the IRS requests additional details or performs an audit related to your ERC claim.
It is essential to research and vet any business offering ERC filing support to ensure their credibility and expertise. Try to find established companies with experience in tax and payroll services, or think about connecting to relied on accounting firms or tax specialists who use ERC filing support.
Keep in mind that while these business can offer important assistance, it’s constantly a good idea to have a standard understanding of the ERC requirements and procedure yourself. This will help you make informed decisions and guarantee precise filings.
The Employee 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 businesses to maintain and pay their employees throughout the pandemic, even if their operations have been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is readily available to qualified companies, consisting of for-profit services, tax-exempt organizations, and certain governmental entities. To certify, companies need to fulfill one of two requirements:.
The business operations were totally or partially suspended due to a federal government order related to COVID-19.
The business experienced a substantial decrease in gross receipts. As discussed previously, for 2021, a substantial decline is defined as a 20% decline in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a significant decrease is defined as a 20% decline in gross invoices compared to the same quarter in 2019, or a 20% decline in gross receipts 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 amount is equal to a percentage (approximately 70%) of qualified wages paid to staff members, including specific health plan costs. The maximum 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, companies that got an Income Security Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 allows businesses to claim the ERC even if they received a PPP loan. The exact same salaries can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively expanded and boosted, enabling eligible employers to claim the credit for qualified wages paid as far back as March 13, 2020. This retroactive provision offers an opportunity for services to change prior-year tax returns and get refunds.
Claiming the Credit: Employers can claim the ERC by reporting it on their employment tax returns, generally Kind 941. If the credit surpasses the amount of employment taxes owed, the excess can be reimbursed to the employer.
It is very important to note that the ERC arrangements and eligibility criteria have evolved in time. The best strategy is to speak with a tax expert or visit the main IRS website for the most updated and comprehensive details regarding the ERC, including any recent legal changes or updates.
To receive the ERC, a company needs to fulfill one of the following criteria:.
Business operations were completely or partly suspended due to a government order related to COVID-19.
Business experienced a considerable decrease in gross receipts. For 2021, a significant decrease is specified as a 20% decline in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a significant decrease is specified as a 20% decrease in gross receipts compared to the exact same quarter in 2019, or a 20% decline in gross receipts compared to the immediately preceding quarter.
The ERC is readily available to businesses of all sizes, including tax-exempt companies, but there are some exceptions. For example, federal government entities and companies that got a PPP loan might have restrictions on claiming the credit.
The procedure for claiming the ERC involves finishing the required forms and including the credit on your employment income tax return (generally Kind 941). The exact time it requires to process the credit can differ based on several aspects, including the intricacy of your company and the workload of the IRS. It’s suggested to seek advice from a tax expert for assistance particular to your situation.
There are a number of business that can help with the procedure of declaring the ERC. Some well-known companies that provide support with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the information offered here is based upon basic understanding and may not reflect the most current updates or modifications to the ERC. It is very important to consult with a tax expert or visit the main IRS website for the most up-to-date and precise details concerning eligibility, declaring treatments, and readily available help.
Less than 100. The credit is based if the employer had 100 or less staff members on average in 2019.
on salaries paid to all employees whether they in fact 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. The credit is if the employer had more than 100 staff members on average in 2019.
allowed just for wages paid to workers who did not work during the calendar quarter.
In both cases, “salaries” includes not simply cash payments but also a portion of the cost of company.
supplied healthcare. Employee Retention Credit Do It Yourself
Payment.
Employers can be immediately repaid for the credit by decreasing the quantity of payroll taxes they.