Lets talk first about Employee Retention Credit If You Received Ppp :
Our group here what do these guys doing everybody in this room is helping teach people about ERC and uh constantly supply a gorgeous breakfast and have people really discover the program we must head to the space where we are able to display some of the checks that we are getting for business and I want to see that what is this this is uh numerous countless dollars literally Kevin hundreds of countless dollars so these are duplicate copies of the letters that go to customers verifying that the check is on the way I suggest you understand if you simply start to take a look at some of these here I mean this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I suggest it’s simply I indicate consider how many actual customers that went through the program yeah this is the very end this is the celebration at the end when the check is confirmed the numbers are verified and the check is on the mail in the mail from the IRS heading to the customer so that’s how you’re able to track it you understand when you
get this you know the check is chosen sure which’s when they pay so they don’t pay anything up until they actually receive the cash they don’t pay bottom line Wonder trust anything until this letter is verified the check is on the way they deposit it into their savings account and they can genuinely rely on Wonder trust that the process has been ended up and how many you think you have actually processed given that you started this we have to do with 35 000 of these for
about six billion dollars wow so plainly they understand what they’re doing and that’s what you require you require 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 Wonderful here you’re at my YouTube channel we’re talking about something really crucial today the staff member retention credit which the majority of you have actually never heard of I definitely hadn’t become aware of it up until very recently and discovered a lot about it due to the fact that this is probably the most affordable expense of capital for any small business anywhere
anytime if you have staff members in between five and five hundred so I’ve got the specialist with me this is Josh Fox he’s the founder and CEO of bottom line Concepts they’re the biggest processor of these ERC credits this is a 170 page program so it’s challenging this isn’t like PPP we just call up your bank supervisor and say 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 become yes the Ambassador and paid spokesperson for this I enjoy this program it’s disappearing very soon you got to find out everything about it let’s talk staff member retention credit Josh Fox what is an ERC let’s just start there so throughout the Trump Administration when President Trump was enacted they developed the cares Act and the cares act used organizations three chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically everybody it makes a big 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 money payroll tax refund fine go on sorry I simply have to make sure we got that point I mean that’s a huge distinction a loan versus cash cash I like money money that’s what we’re speaking 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 hard check in the mail where you get actual cash from the internal revenue service all right so let’s speak about how it works because it seems like to me if it’s a if it’s staff member retention credit that individual 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 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. 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 correct so there were 6 quarters the program was open well walk us through the six quarters so you had quarters two 3 and 4 of 2020 and you had quarters one two and three of 2021. okay so that’s how it’s measured 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 6 quarters so the estimation in 2020 to be exact Kevin is 50 of the employee’s salary to an optimum of 5 thousand dollars per staff member for the year of 2020 and in 2021 the numbers increased to 70 of the worker’s salary to a maximum of 7 thousand per quarter how did that happen um they simply changed 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 approximately five thousand Max and then what takes place 21 000 Max in 2021 oh that’s how you come up with 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 since 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 decrease the 26 000 so what we’re seeing usually Kevin is if you took PPP cash somewhere around ten thousand dollars an individual so let’s state hypothetically you owned a dining establishment 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 IRS so it’s big undoubtedly now the big question is why does nobody learn about this because look when I first became aware of this when I first met Josh you understand I have actually got great deals of investments in lots of companies I’m a major advocate for entrepreneurship in America and make numerous many financial investments in business owners of which many suffered through the pandemic when I initially became aware of this I called BS I don’t believe it because I utilize 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 been worthy of and we utilized them carefully to stay alive during the pandemic so when I became aware of this I said nah it can’t hold true but when I dug around I even contacted us to my political leader buddies Governor Senators they didn’t know about it I suggest that’s how you know that’s how misinformation is that there’s no information out there then a lot of individuals told me well you can’t get it because you took the PPP likewise not true so let’s ask Josh why does no one know about the staff member retention credit you know what’s intriguing you’re talking about the banks Kevin due to the fact that in the PPP loan process the federal government made it very clear that if you wanted a PPP loan you would call Wells Fargo Citibank Bank of America any of the big banks in our nation and they would process procedure in Canada a pre-pp loan there’s no loans in Canada by the way it’s simply process procedure that’s all um and here there was turmoil since remember 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 altered the law in 2021 the banks were not 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 know how to do this not really he or she’s never done it previously do the banks do it nope the banks don’t do it the payroll business yeah some of them are doing it as a payroll company your accounting professional no your accounting professional’s never ever done this prior to unless you have an account that entered into this company and bottom line my firm Kevin has been in business considering that 2009 and we’ve been dealing with the federal government and the state federal government to recuperate money for Fortune 500 Fortune 1000 companies so a lot of our huge big corporate clients have dealt 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 government programs.
The staff member retention tax credit is a broad based refundable tax credit designed to motivate.
companies to keep employees on their payroll. The credit is 50% of approximately $10,000 in earnings paid by an.
employer whose organization is fully or partially suspended because of COVID-19 or whose gross receipts.
decrease by more than 50%.
1. The credit is offered to all employers regardless of size including tax exempt companies. There are.
just two exceptions: (1) state and city governments and their instrumentalities and (2) little.
services who take Small company 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 organization is fully or partially 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 comparable quarter in 2019. Once the.
company’s gross invoices go above 80% of a comparable quarter in 2019 they no longer certify.
after completion of that quarter.
Calculation of the Credit.
The amount of the credit is 50% of the certifying wages paid up to $10,000 in overall.
It works for earnings paid after March 13th and prior to December 31, 2020.
The definition of qualifying wages varies by whether an employer had, typically, more or less than.
100 employees in 2019.
Business that focus on ERC filing support normally supply know-how and assistance to help services navigate the intricate process of claiming the credit. They can offer numerous services, including:.
How is the employee retention credit calculated? Employee Retention Credit If You Received Ppp
Eligibility Assessment: These companies will evaluate your company’s eligibility for the ERC based on factors such as your market, profits, and operations. If you satisfy the requirements for the credit and identify the maximum credit amount you can claim, they can help determine.
Paperwork and Estimation: ERC filing services will assist in gathering the needed documentation, such as payroll records and financial statements, to support your claim. They will likewise help compute the credit quantity based on eligible incomes and other qualifying costs.
Retroactive Claim Evaluation: If you are qualified to claim the ERC for previous quarters, these companies can examine your previous payroll records and financials to recognize potential opportunities for retroactive credits. They can help you amend previous tax returns to claim these refunds.
Filing Help: Business specializing in ERC filings will prepare and send the necessary types and paperwork on your behalf. This includes finishing Type 941 or any other required tax return.
Compliance and Updates: ERC guidelines and assistance have actually evolved gradually. These companies remain updated with the latest modifications and ensure that your filings adhere to the most present guidelines. If the IRS demands additional info or carries out an audit associated to your ERC claim, they can also supply continuous support.
It’s important to research study and vet any company offering ERC filing assistance to guarantee their trustworthiness and knowledge. Search for recognized firms with experience in tax and payroll services, or consider reaching out to relied on accounting firms or tax professionals who provide ERC filing assistance.
Bear in mind that while these companies can offer important assistance, it’s always an excellent concept to have a basic understanding of the ERC requirements and procedure yourself. This will assist you make notified decisions and make sure accurate filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit presented by the U.S. government as part of COVID-19 relief procedures. The objective of the ERC is to motivate organizations to keep and pay their staff members throughout the pandemic, even if their operations have actually been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is readily available to eligible companies, consisting of for-profit companies, tax-exempt companies, and certain governmental entities. To certify, employers must fulfill one of two criteria:.
The business operations were totally or partly suspended due to a government order related to COVID-19.
The business experienced a substantial decline in gross invoices. As mentioned earlier, for 2021, a significant decline is defined as a 20% decrease in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a substantial decrease is defined as a 20% decline in gross invoices compared to the same quarter in 2019, or a 20% decrease in gross invoices compared to the right away 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 portion (approximately 70%) of certified incomes paid to staff members, including particular 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, businesses that got a Paycheck Protection Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 enables businesses to declare the ERC even if they got a PPP loan. However, the same incomes can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has actually been retroactively expanded and enhanced, enabling eligible employers to claim the credit for certified wages paid as far back as March 13, 2020. This retroactive provision provides an opportunity for businesses to amend prior-year tax returns and get refunds.
Claiming the Credit: Employers can claim the ERC by reporting it on their employment income tax return, usually Type 941. The excess can be refunded to the employer if the credit goes beyond the quantity of employment taxes owed.
It’s important to keep in mind that the ERC arrangements and eligibility requirements have progressed gradually. The best course of action is to talk to a tax professional or check out the main internal revenue service site for the most current and comprehensive information regarding the ERC, including any current legislative changes or updates.
To receive the ERC, an organization should satisfy one of the following criteria:.
The business operations were totally or partially suspended due to a government order related to COVID-19.
The business experienced a considerable decline in gross invoices. For 2021, a substantial decline is defined as a 20% decline in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a significant decrease is defined as a 20% decrease in gross invoices compared to the very same quarter in 2019, or a 20% decline in gross receipts compared to the instantly preceding quarter.
The ERC is readily available to services of all sizes, including tax-exempt organizations, however there are some exceptions. Federal government entities and organizations that received a PPP loan may have limitations on declaring the credit.
The process for declaring the ERC includes completing the needed forms and including the credit on your employment income tax return (generally Form 941). The exact time it requires to process the credit can vary based upon numerous factors, including the intricacy of your organization and the work of the internal revenue service. It’s suggested to talk to a tax expert for assistance specific to your circumstance.
There are several business that can assist with the procedure of claiming the ERC. These consist of accounting companies, tax advisory services, and payroll company. Some well-known business that provide support with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s recommended to research study and call these companies straight to inquire about their services and charges.
Please note that the info offered here is based upon general knowledge and may not reflect the most recent updates or changes to the ERC. It is very important to seek advice from a tax professional or go to the main internal revenue service website for the most current and accurate information relating to eligibility, claiming procedures, and available help.
Less than 100. The credit is based if the employer had 100 or fewer employees on average in 2019.
on wages paid to all employees whether they really worked or not. To put it simply, even if the.
employees worked full-time and made money for full-time work, the company still gets the credit.
Greater than 100. The credit is if the employer had more than 100 employees on average in 2019.
allowed only for earnings paid to employees who did not work throughout the calendar quarter.
In both cases, “incomes” consists of not just cash payments but also a portion of the cost of employer.
provided health care. Employee Retention Credit If You Received Ppp
Companies can be instantly compensated for the credit by reducing the amount of payroll taxes they.