Lets talk first about Employee Retention Credit For S Corp Owners :
Our team here what do these people doing everyone in this room is assisting teach individuals about ERC and uh constantly supply a gorgeous breakfast and have people really learn more about the program we ought to head to the room where we are able to display some of the checks that we are getting for companies and I ‘d like to see that what is this this is uh numerous countless dollars literally Kevin numerous millions of dollars so these are replicate copies of the letters that go to clients verifying that the check is on the method I imply you understand if you simply start to 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 indicate it’s just I mean consider the number of real customers that went through the program yeah this is the very end this is the celebration at the end when the check is verified 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 know the check is opted for sure which’s when they pay so they don’t pay anything until they actually receive the cash they do not pay bottom line Wonder trust anything till this letter is verified the check is on the method they deposit it into their savings account and they can truly rely on Wonder trust that the procedure has actually been ended up and the number of you think you have actually processed considering that you started this we have to do with 35 000 of these for
about 6 billion dollars wow so plainly they understand what they’re doing and that’s what you need you need specialists 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 Terrific here you’re at my YouTube channel we’re speaking about something actually important today the employee retention credit which most of you have never become aware of I certainly hadn’t become aware of it up until extremely just recently and discovered a lot about it since this is most likely the most affordable expense of capital for any small company anywhere
anytime if you have employees in between five and five hundred so I have actually got the professional with me this is Josh Fox he’s the creator and CEO of bottom line Principles 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 just call your bank manager and say provide 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 enjoy this program it’s disappearing soon you got to discover 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 came up with the cares Act and the cares act provided businesses 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 distinction right there two of them are loans and one’s a refund exactly so the ERC is a refund that’s.
correct the money cash payroll tax refund all right go on sorry I just need to make sure we got that point I suggest that’s a huge difference a loan versus cash money I like money cash 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 gorgeous difficult 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 individual had to be a worker so I’m going to make the Assumption this money is not for the owner not for people on the cap table not for shareholders it’s for staff members right you had to have owned a company but it’s based on you having W-2 workers in America not 10.99. As long as you had W-2 staff members 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 first 6 months of 2021 on the W-2 right so there were 6 quarters the program was open well stroll us through the six quarters so you had quarters 2 three and four of 2020 and you had quarters one two and 3 of 2021. all right so that’s how it’s measured you have 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 staff member that was on a W-2 in those six quarters so the calculation in 2020 to be specific Kevin is 50 of the staff member’s salary to an optimum of 5 thousand dollars per employee for the year of 2020 and in 2021 the numbers escalated to 70 of the worker’s salary to an optimum of 7 thousand per quarter how did that take place um they simply altered the rules in.
2021 versus because the turmoil 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 five thousand Max and then what occurs 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 employee that is because that’s a lot of cash it is now there’s a caution here the PPP money would have to be minimized 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 on average Kevin is if you took PPP cash somewhere around 10 thousand dollars a person so let’s say hypothetically you owned a restaurant in New york city City where I’m from and you had a hundred workers 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 question is why does nobody learn about this because appearance when I first found out about this when I first met Josh you understand I’ve got great deals of financial investments in great deals of business I’m a major supporter for entrepreneurship in America and make lots of numerous investments in business owners of which many suffered through the pandemic when I initially heard about this I called BS I don’t believe it because I use 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 been worthy of and we used them sensibly to stay alive during the pandemic so when I became aware of this I stated nah it can’t hold true however when I dug around I even called to my political leader pals Guv Senators they didn’t know about it I mean that’s how you know that’s how misinformation is that there’s no information out there then a lot of people informed me well you can’t get it since you took the PPP likewise not real so let’s ask Josh why does no one understand about the employee retention credit you know what’s interesting you’re talking about the banks Kevin because 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 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 because keep in mind in the initial cares act you might not do both programs so if you had 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 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 anyone about how to.
do this does your CFO understand how to do this not actually she or he’s never done it in the past 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 company your accounting professional no your accounting professional’s never done this prior to unless you have an account that went into this business and bottom line my firm Kevin has actually stayed in business since 2009 and we have actually been working with the federal government and the state federal government to recover cash for Fortune 500 Fortune 1000 companies so a lot of our big huge business clients have actually worked with bottom line to recuperate other federal government programs we’ve done sales tax and use tax unemployment 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 encourage.
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 completely or partly suspended because of COVID-19 or whose gross receipts.
decline by more than 50%.
1. The credit is readily available to all employers regardless of size consisting of tax exempt companies. There are.
just 2 exceptions: (1) state and city governments and their instrumentalities and (2) little.
businesses who take Small company Loans.
2. To qualify, the employer has to fulfill one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the company’s business is totally or partially 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 comparable quarter in 2019. When the.
company’s gross invoices go above 80% of a comparable quarter in 2019 they no longer certify.
after the end of that quarter.
Calculation of the Credit.
The amount of the credit is 50% of the certifying salaries paid up to $10,000 in total.
It is effective for incomes paid after March 13th and before December 31, 2020.
The meaning of qualifying wages varies by whether a company had, typically, more or less than.
100 workers in 2019.
Companies that concentrate on ERC filing help usually provide knowledge and support to assist businesses browse the complicated procedure of claiming the credit. They can offer different services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit For S Corp Owners
Eligibility Evaluation: These business will examine your organization’s eligibility for the ERC based upon elements such as your industry, earnings, and operations. If you meet the requirements for the credit and identify the maximum credit amount you can declare, they can assist identify.
Documents and Computation: ERC filing services will help in gathering the needed documentation, such as payroll records and financial statements, to support your claim. They will also help determine the credit amount based on eligible incomes and other certifying expenses.
Retroactive Claim Evaluation: If you are eligible to claim the ERC for prior quarters, these companies can evaluate your previous payroll records and financials to recognize prospective chances for retroactive credits. They can assist you amend prior tax returns to claim these refunds.
Filing Support: Companies specializing in ERC filings will prepare and submit the essential kinds and documents on your behalf. This consists of finishing Form 941 or any other required tax return.
Compliance and Updates: ERC regulations and guidance have progressed in time. These companies stay updated with the current changes and make sure that your filings comply with the most existing standards. They can likewise offer continuous assistance if the internal revenue service requests additional details or performs an audit related to your ERC claim.
It is necessary to research and vet any business using ERC filing help to ensure their reliability and expertise. Search for established firms with experience in tax and payroll services, or think about reaching out to trusted accounting firms or tax specialists who use ERC submitting assistance.
Keep in mind that while these companies can offer important assistance, it’s constantly a great concept to have a basic understanding of the ERC requirements and procedure yourself. This will help you make informed choices and make sure accurate filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit presented by the U.S. federal government as part of COVID-19 relief procedures. The objective of the ERC is to encourage organizations to maintain and pay their employees during the pandemic, even if their operations have actually been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is offered to eligible employers, including for-profit companies, tax-exempt organizations, and particular governmental entities. To certify, companies need to fulfill one of two criteria:.
The business operations were completely or partially suspended due to a government order related to COVID-19.
The business experienced a substantial decline in gross receipts. As pointed out previously, for 2021, a considerable decline is specified as a 20% decrease in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a considerable decline is specified as a 20% decrease 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 Quantity: The ERC is a refundable tax credit that offsets the employer’s share of Social Security taxes. The credit amount amounts to a portion (as much as 70%) of qualified incomes paid to workers, consisting of certain health insurance 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: Initially, companies that got a Paycheck Security Program (PPP) loan were not eligible for the ERC. However, legislation passed in late 2020 and extended in 2021 permits organizations to declare the ERC even if they got a PPP loan. The same wages can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively broadened and enhanced, allowing qualified employers to claim the credit for certified earnings paid as far back as March 13, 2020. This retroactive arrangement provides an opportunity for organizations to amend prior-year income tax return and get refunds.
Declaring the Credit: Employers can claim the ERC by reporting it on their work tax returns, generally Type 941. If the credit goes beyond the amount of work taxes owed, the excess can be reimbursed to the employer.
It’s important to keep in mind that the ERC provisions and eligibility criteria have actually developed in time. The best course of action is to consult with a tax expert or check out the official internal revenue service website for the most in-depth and current information concerning the ERC, consisting of any recent legal changes or updates.
To receive the ERC, an organization needs to satisfy one of the following criteria:.
The business operations were totally or partially suspended due to a government order related to COVID-19.
Business experienced a substantial decline in gross receipts. For 2021, a significant decline is specified as a 20% decrease 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 exact 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 companies, however there are some exceptions. For instance, government entities and companies that got a PPP loan may have limitations on claiming the credit.
The process for claiming the ERC includes finishing the required types and including the credit on your work tax return (normally Type 941). The exact time it takes to process the credit can vary based on numerous aspects, consisting of the complexity of your company and the workload of the IRS. It’s recommended to seek advice from a tax professional for guidance particular to your scenario.
There are a number of business that can aid with the procedure of declaring the ERC. These include accounting companies, tax advisory services, and payroll provider. Some popular business that offer assistance with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s advisable to research study and contact these business directly to ask about their services and charges.
Please keep in mind that the details supplied here is based upon general knowledge and may not reflect the most current updates or changes to the ERC. It is very important to consult with a tax expert or visit the main internal revenue service site for the most updated and precise info concerning eligibility, claiming treatments, and offered help.
Less than 100. If the company had 100 or less employees on average in 2019, then the credit is based.
on incomes paid to all staff members whether they in fact worked or not. In other words, even if the.
staff members worked full time and got paid for full-time work, the employer still gets the credit.
Greater than 100. The credit is if the company had more than 100 staff members on average in 2019.
enabled just for earnings paid to staff members who did not work during the calendar quarter.
In both cases, “incomes” consists of not simply cash payments however also a portion of the expense of company.
offered health care. Employee Retention Credit For S Corp Owners
Companies can be instantly reimbursed for the credit by minimizing the amount of payroll taxes they.