Lets talk first about Employee Retention Credit How To Claim :
Our group here what do these guys doing everyone in this room is helping teach individuals about ERC and uh constantly provide a stunning breakfast and have individuals really find out about the program we must head to the room where we have the ability to show some of the checks that we are getting for companies and I ‘d like to see that what is this this is uh hundreds of countless dollars actually Kevin hundreds of countless dollars so these are replicate copies of the letters that go to clients verifying that the check is on the method I imply you know if you simply 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 mean it’s just I suggest think of 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 understand when you
get this you know the check is gone for sure and that’s when they pay so they do not pay anything until they really get the cash they don’t pay bottom line Wonder trust anything until this letter is verified the check is on the method they transfer it into their checking 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 began this we’re about 35 000 of these for
about 6 billion dollars wow so plainly they understand what they’re doing which’s what you need you need 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 talking about something actually important today the staff member retention credit which most of you have never ever become aware of I definitely hadn’t heard of it until extremely just recently and learned a lot about it due to the fact that this is probably the lowest cost of capital for any small business anywhere
anytime if you have workers in between 5 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 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 up your bank manager and state give me a loan it does not 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 become yes the Ambassador and paid spokesperson for this I like this program it’s disappearing 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 during the Trump Administration when President Trump was enacted they came up with the cares Act and the cares act offered companies 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 distinction right there two 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 all right go on sorry I just have to make certain we got that point I suggest that’s a big distinction a loan versus money cash I like money cash that’s what we’re talking about fine 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 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 sounds like to me if it’s a if it’s worker retention credit that person had to be a worker so I’m going to make the Presumption this cash is not for the owner not for individuals on the cap table not for investors it’s for staff members right you needed to have actually owned an organization however it’s based on you having W-2 workers 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 6 quarters so you had quarters two three and four of 2020 and you had quarters one two and three of 2021. alright so that’s how it’s measured you have to be on the W-2 throughout that period now let’s talk my favorite part money just how much can you get back per worker 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 wage to a maximum of five thousand dollars per worker 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 occur um they just altered the rules in.
2021 versus due to the fact that the chaos of the pandemic so they wanted 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 up to five thousand Max and then what takes place 21 000 Max in 2021 oh that’s how you develop twenty six thousand twenty one thousand to twenty twenty one plus five 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 have to be minimized from the twenty six 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 a person so let’s state hypothetically you owned a restaurant in New york city 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 big clearly now the big question is why does no one know about this because appearance when I first became aware of this when I first fulfilled Josh you understand I’ve got great deals of investments in great deals of companies I’m a major supporter for entrepreneurship in America and make numerous lots of financial investments in entrepreneurs of which many suffered through the pandemic when I first found out about this I called BS I don’t believe it since 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 and that were well deserved and we utilized them wisely to stay alive throughout the pandemic so when I heard about this I stated nah it can’t be true but when I dug around I even called to my politician 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 details out there then a lot of people told me well you can’t get it since you took the PPP likewise not true so let’s ask Josh why does nobody know about the staff member retention credit you know what’s intriguing you’re speaking 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 procedure in Canada a pre-pp loan there’s no loans in Canada by the way it’s simply procedure procedure that’s all um and here there was turmoil due to the fact that keep in mind in the initial cares act you might not do both programs so if you had 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 since it’s not alone so you’re getting a tax refund so the federal government never made it clear to any person about how to.
do this does your CFO understand how to do this not actually she or he’s never ever done it in the past 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 accounting professional no your accounting professional’s never done this prior to unless you have an account that went into this service and bottom line my company Kevin has been in business given that 2009 and we’ve been working with the federal government and the state federal government to recover money for Fortune 500 Fortune 1000 companies so a lot of our big huge business customers have dealt with bottom line to recuperate other government programs we’ve done sales tax and utilize tax unemployment tax work opportunity tax credits research and development tax credits unclaimed property real estate tax all of these other government programs.
The employee 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 up to $10,000 in salaries paid by an.
Due to the fact that of COVID-19 or whose gross receipts, company whose service is totally or partially suspended.
decline by more than 50%.
Availability.
1. The credit is offered to all companies no matter size consisting of tax exempt companies. There are.
only 2 exceptions: (1) state and local governments and their instrumentalities and (2) little.
businesses who take Small company Loans.
2. To qualify, the company needs to fulfill one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the company’s organization is fully or partially suspended by government order due to COVID-19.
throughout the calendar quarter or.
o the employer’s gross receipts are below 50% of the comparable quarter in 2019. Once the.
company’s gross receipts go above 80% of an equivalent quarter in 2019 they no longer certify.
after completion of that quarter.
Calculation of the Credit.
The quantity of the credit is 50% of the certifying incomes paid up to $10,000 in overall.
It is effective for earnings paid after March 13th and before December 31, 2020.
The definition of certifying salaries differs by whether a company had, on average, basically than.
100 staff members in 2019.
Business that focus on ERC filing support typically provide competence and support to assist businesses navigate the intricate process of declaring the credit. They can use different services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit How To Claim
Eligibility Evaluation: These business will evaluate your business’s eligibility for the ERC based upon elements such as your industry, revenue, and operations. If you fulfill the requirements for the credit and identify the optimum credit quantity you can claim, they can assist determine.
Documentation and Calculation: ERC filing services will assist in gathering the required documentation, such as payroll records and monetary declarations, to support your claim. They will likewise assist calculate the credit amount based upon qualified wages and other certifying expenses.
Retroactive Claim Review: If you are eligible to claim the ERC for previous quarters, these business can review your past payroll records and financials to determine prospective chances for retroactive credits. They can assist you modify previous income tax return to claim these refunds.
Filing Help: Business concentrating on ERC filings will prepare and submit the necessary types and paperwork in your place. This includes completing Kind 941 or any other required tax forms.
Compliance and Updates: ERC regulations and assistance have developed over time. These business stay upgraded with the latest changes and ensure that your filings adhere to the most existing standards. They can likewise supply continuous support if the internal revenue service requests additional info or carries out an audit related to your ERC claim.
It is necessary to research study and vet any company providing ERC filing assistance to guarantee their reliability and expertise. Look for established firms with experience in tax and payroll services, or think about reaching out to relied on accounting firms or tax professionals who provide ERC filing support.
Bear in mind that while these business can supply valuable help, it’s constantly a great idea to have a basic understanding of the ERC requirements and procedure yourself. This will help you make informed decisions and make sure precise filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit introduced by the U.S. federal government as part of COVID-19 relief procedures. The goal of the ERC is to encourage organizations to maintain and pay their staff members throughout the pandemic, even if their operations have actually been affected.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is offered to eligible employers, including for-profit businesses, tax-exempt organizations, and certain governmental entities. To qualify, employers need to meet 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 pointed out previously, for 2021, a considerable decline is defined as a 20% decline in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a significant decline is specified as a 20% decrease in gross invoices compared to the very same quarter in 2019, or a 20% decrease in gross receipts compared to the immediately preceding quarter.
Credit Amount: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit quantity is equal to a percentage (as much as 70%) of qualified incomes paid to staff members, including certain health plan expenditures. 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, services that received a Paycheck Defense Program (PPP) loan were not eligible for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 enables organizations to declare the ERC even if they received a PPP loan. Nevertheless, the same incomes can not be utilized to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively broadened and improved, enabling qualified companies to declare the credit for certified earnings paid as far back as March 13, 2020. This retroactive arrangement offers a chance for services to amend prior-year income tax return and get refunds.
Claiming the Credit: Employers can claim the ERC by reporting it on their employment income tax return, usually Form 941. If the credit goes beyond the amount of employment taxes owed, the excess can be refunded to the company.
It is necessary to keep in mind that the ERC provisions and eligibility requirements have progressed gradually. The very best course of action is to talk to a tax expert or go to the official internal revenue service website for the most detailed and updated information relating to the ERC, consisting of any recent legal modifications or updates.
To qualify for the ERC, a service needs to satisfy one of the following requirements:.
Business operations were fully or partially suspended due to a federal government order related to COVID-19.
Business experienced a considerable decrease in gross receipts. For 2021, a significant decrease is defined as a 20% decline in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a considerable decline is specified as a 20% decline in gross invoices compared to the very same quarter in 2019, or a 20% decline in gross receipts compared to the right away preceding quarter.
The ERC is offered to companies of all sizes, including tax-exempt companies, but there are some exceptions. For example, federal government entities and companies that got a PPP loan may have restrictions on declaring the credit.
The procedure for claiming the ERC involves completing the essential types and consisting of the credit on your employment tax return (generally Form 941). The exact time it requires to process the credit can vary based on numerous aspects, consisting of the complexity of your company and the work of the internal revenue service. It’s suggested to seek advice from a tax professional for guidance particular to your situation.
There are numerous business that can assist with the procedure of declaring the ERC. These consist of accounting companies, tax advisory services, and payroll provider. Some widely known companies that use help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s suggested to research and contact these companies directly to inquire about their costs and services.
Please keep in mind that the info provided here is based upon basic knowledge and might not reflect the most current updates or modifications to the ERC. It’s important to seek advice from a tax professional or visit the main IRS website for the most precise and updated details regarding eligibility, declaring treatments, and available support.
Less than 100. If the employer had 100 or fewer employees typically in 2019, then the credit is based.
on wages paid to all staff members whether they in fact worked or not. To put it simply, 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 company had more than 100 employees on average in 2019.
allowed just for wages paid to staff members who did not work during the calendar quarter.
In both cases, “wages” consists of not just money payments but also a part of the cost of company.
supplied healthcare. Employee Retention Credit How To Claim
Payment.
Companies can be right away repaid for the credit by minimizing the quantity of payroll taxes they.