Lets talk first about Employee Retention Credit Large Employer :
Our team here what do these people doing everybody in this space is helping teach individuals about ERC and uh always offer a gorgeous breakfast and have individuals really learn about the program we should head to the room where we are able to show some of the checks that we are getting for business and I ‘d like to see that what is this this is uh hundreds of countless dollars actually Kevin numerous countless dollars so these are replicate copies of the letters that go to clients validating that the check is on the way I imply you know if you simply start to look at some 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 just I indicate think of the number of actual customers that went through the program yeah this is the very end this is the party at the end when the check is verified the numbers are confirmed and the check is on the mail in the mail from the internal revenue service heading to the customer so that’s how you’re able to track it you understand when you
receive this you know the check is opted for sure which’s when they pay so they do not pay anything until they actually receive the money they do not pay bottom line Wonder trust anything till this letter is verified the check is on the way they deposit it into their checking account and they can truly trust Wonder trust that the procedure has been finished and how many you think you have actually processed because you started this we’re about 35 000 of these for
about six billion dollars wow so clearly they know what they’re doing which’s what you require you need specialists 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 truly crucial today the staff member retention credit which the majority of you have actually never become aware of I certainly hadn’t become aware of it till really just recently and discovered a lot about it because this is most likely the most affordable cost of capital for any small business anywhere
anytime if you have staff members in between five 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 largest processor of these ERC credits this is a 170 page program so it’s difficult this isn’t like PPP we simply phone your bank manager and say offer me a loan it does not work there’s not a loan it’s an application and Josh is going to tell us all about it and how to get it and why I have actually become yes the Ambassador and paid representative for this I enjoy this program it’s going away soon you got to find out everything about it let’s talk employee retention credit Josh Fox what is an ERC let’s simply begin there so during the Trump Administration when President Trump was enacted they created the cares Act and the cares act used businesses three opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly everyone it makes a huge 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 just need to make certain we got that point I mean that’s a huge distinction a loan versus money money I like cash money that’s what we’re discussing okay 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 original cares Act is the ERC and yes Kevin it is a lovely hard check in the mail where you get actual money from the internal revenue service all right so let’s talk about how it works since it sounds like to me if it’s a if it’s employee retention credit that person needed 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 staff members right you needed to have owned an organization however it’s based upon 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 have to be on payroll in 2020 on the W-2 and you need 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 walk us through the six quarters so you had quarters 2 three and four of 2020 and you had quarters one 2 and three of 2021. all right so that’s how it’s measured you need to be on the W-2 during that duration now let’s talk my preferred part money how much can you return per employee that was on a W-2 in those six quarters so the estimation in 2020 to be specific Kevin is 50 of the worker’s wage to an optimum of 5 thousand dollars per worker for the year of 2020 and in 2021 the numbers escalated to 70 of the employee’s salary to an optimum of seven thousand per quarter how did that take place um they simply changed the rules in.
2021 versus because the turmoil 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 five thousand Max and then what takes place 21 000 Max in 2021 oh that’s how you create twenty six thousand twenty one thousand to twenty twenty one plus five thousand in twenty twenty that’s twenty six thousand dollars per employee that is because that’s a great deal of cash it is now there’s a caveat here the PPP cash would need to be lowered from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan two you would reduce the 26 000 so what we’re seeing on average 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 City where I’m from and you had a hundred employees and you took PPP money you would still get a million dollar in the mail from the IRS so it’s huge certainly now the big question is why does nobody learn about this due to the fact that look when I initially found out about this when I initially satisfied Josh you understand I have actually got lots of investments in great deals of business I’m a significant advocate for entrepreneurship in America and make numerous lots of investments in entrepreneurs of which many suffered through the pandemic when I initially found out about this I called BS I do not think it since 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 and that were well deserved and we utilized them wisely to stay alive throughout 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 pals Guv Senators they didn’t understand 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 also not real so let’s ask Josh why does nobody understand about the employee retention credit you understand what’s fascinating you’re speaking about the banks Kevin since 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 big 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 just procedure process that’s all um and here there was chaos since keep in mind in the initial cares act you could refrain from doing both programs so if you had actually done PPP you could not do ERC in the original 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 know how to do this not really she or he’s never done it previously do the banks do it nope the banks do not do it the payroll business yeah some of them are doing it as a payroll business your accounting professional no your accounting professional’s never ever done this before unless you have an account that went into this business and bottom line my company Kevin has actually been in business given that 2009 and we’ve been working with the federal government and the state government to recuperate cash for Fortune 500 Fortune 1000 business so a great deal of our big huge business customers have actually dealt with bottom line to recuperate other federal government programs we have actually done sales tax and use tax unemployment tax work opportunity tax credits research and development tax credits unclaimed home property tax all of these other government programs.
The worker retention tax credit is a broad based refundable tax credit designed to motivate.
employers to keep employees on their payroll. The credit is 50% of approximately $10,000 in wages paid by an.
employer whose service is totally or partially suspended because of COVID-19 or whose gross receipts.
decrease by more than 50%.
1. The credit is 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.
companies who take Small company Loans.
2. To qualify, the employer needs to satisfy one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the company’s organization is totally or partly suspended by 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. Once the.
employer’s gross receipts exceed 80% of a similar 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 qualifying salaries paid up to $10,000 in overall.
It is effective for wages paid after March 13th and prior to December 31, 2020.
The definition of certifying wages varies by whether an employer had, on average, basically than.
100 staff members in 2019.
Business that focus on ERC filing support typically offer know-how and support to assist businesses browse the complicated procedure of declaring the credit. They can provide numerous services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit Large Employer
Eligibility Assessment: These business will examine your business’s eligibility for the ERC based on elements such as your market, profits, and operations. If you satisfy the requirements for the credit and identify the maximum credit amount you can declare, they can assist determine.
Documentation and Calculation: ERC filing services will assist in gathering the needed documents, such as payroll records and financial declarations, to support your claim. They will likewise assist determine the credit quantity based upon qualified incomes and other certifying expenditures.
Retroactive Claim Review: If you are eligible to claim the ERC for previous quarters, these business can review your previous payroll records and financials to identify potential opportunities for retroactive credits. They can assist you change previous tax returns to declare these refunds.
Filing Support: Business focusing on ERC filings will prepare and send the required kinds and documentation in your place. This consists of finishing Kind 941 or any other necessary tax return.
Compliance and Updates: ERC policies and assistance have actually evolved in time. These companies stay updated with the latest modifications and guarantee that your filings abide by the most existing guidelines. They can also offer continuous assistance if the internal revenue service requests additional information or conducts an audit related to your ERC claim.
It’s important to research and veterinarian any business using ERC filing help to ensure their credibility and proficiency. Search for recognized firms with experience in tax and payroll services, or think about connecting to relied on accounting firms or tax professionals who use ERC filing assistance.
Keep in mind that while these companies can provide valuable assistance, it’s always a good idea to have a basic understanding of the ERC requirements and procedure yourself. This will assist you make notified choices and make sure precise filings.
The Employee Retention Credit (ERC) is a refundable tax credit presented by the U.S. federal government as part of COVID-19 relief steps. The goal of the ERC is to encourage services to keep and pay their staff members during the pandemic, even if their operations have actually been affected.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is readily available to eligible employers, consisting of for-profit businesses, tax-exempt companies, and certain governmental entities. To certify, companies need to satisfy one of two requirements:.
Business operations were fully or partly suspended due to a federal government order related to COVID-19.
Business experienced a significant decline in gross receipts. As discussed previously, for 2021, a significant decrease is defined as a 20% decrease in gross invoices 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% decrease in gross receipts compared to the instantly preceding quarter.
Credit Amount: The ERC is a refundable tax credit that offsets the employer’s share of Social Security taxes. The credit amount amounts to a percentage (as much as 70%) of certified salaries paid to workers, including certain health insurance expenses. The maximum credit per employee is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: At first, services that got an Income Security Program (PPP) loan were not qualified for the ERC. However, legislation passed in late 2020 and extended in 2021 permits companies to declare the ERC even if they got a PPP loan. However, the same earnings can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively broadened and improved, permitting eligible employers to claim the credit for certified salaries paid as far back as March 13, 2020. This retroactive arrangement provides an opportunity for services to modify prior-year tax returns and receive refunds.
Claiming the Credit: Employers can claim the ERC by reporting it on their employment income tax return, usually Form 941. If the credit exceeds the amount of work taxes owed, the excess can be reimbursed to the company.
It is essential to keep in mind that the ERC arrangements and eligibility requirements have developed with time. The very best strategy is to seek advice from a tax expert or visit the official internal revenue service website for the most detailed and current information regarding the ERC, consisting of any current legal modifications or updates.
To qualify for the ERC, a company must meet one of the following criteria:.
Business operations were totally or partially suspended due to a federal government order related to COVID-19.
Business experienced a significant decrease in gross invoices. For 2021, a substantial decrease is specified as a 20% decrease in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a significant decline is defined as a 20% decline in gross receipts compared to the very same quarter in 2019, or a 20% decrease in gross receipts compared to the immediately preceding quarter.
The ERC is offered to services of all sizes, consisting of tax-exempt companies, however there are some exceptions. For instance, government entities and organizations that got a PPP loan might have restrictions on declaring the credit.
The process for claiming the ERC involves finishing the needed kinds and including the credit on your work tax return (typically Type 941). The exact time it requires to process the credit can vary based on numerous factors, consisting of the intricacy of your service and the workload of the internal revenue service. It’s suggested to seek advice from a tax professional for guidance specific to your situation.
There are a number of business that can help with the process of claiming the ERC. These consist of accounting firms, tax advisory services, and payroll provider. Some popular business that provide support with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s suggested to research study and get in touch with these companies straight to ask about their services and fees.
Please note that the info provided here is based on general knowledge and might not show the most current updates or modifications to the ERC. It is very important to seek advice from a tax professional or check out the official IRS website for the most accurate and updated info concerning eligibility, claiming treatments, and offered support.
Less than 100. The credit is based if the company had 100 or less workers on average in 2019.
on salaries paid to all staff members whether they really worked or not. To put it simply, even if the.
workers worked full-time and made money for full time work, the company still gets the credit.
Greater than 100. The credit is if the company had more than 100 workers on average in 2019.
enabled only for wages paid to staff members who did not work during the calendar quarter.
In both cases, “wages” consists of not just cash payments but likewise a portion of the cost of company.
provided health care. Employee Retention Credit Large Employer
Companies can be instantly compensated for the credit by lowering the amount of payroll taxes they.