Lets talk first about Employee Retention Credit Qualified Health Plan Expenses :
Our team here what do these guys doing everyone in this room is assisting teach individuals about ERC and uh constantly supply a lovely breakfast and have people actually learn more about the program we need to head to the room where we have the ability to show some of the checks that we are getting for business and I want to see that what is this this is uh numerous millions of dollars literally Kevin numerous millions of dollars so these are duplicate copies of the letters that go to clients validating that the check is on the way I indicate you understand if you just begin to look at some of these here I imply this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I mean 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 confirmed the numbers are verified and the check is on the mail in the mail from the internal revenue service heading to the customer so that’s how you have the ability to track it you know when you
receive this you understand the check is opted for sure and that’s when they pay so they don’t pay anything till they really receive the money they do not pay bottom line Wonder trust anything up until this letter is confirmed the check is on the way they deposit it into their savings account and they can really rely on Wonder trust that the procedure has been finished and the number of you believe you’ve processed considering that you started this we’re about 35 000 of these for
about six billion dollars wow so plainly they know what they’re doing which’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 Fantastic here you’re at my YouTube channel we’re discussing something truly essential today the staff member retention credit which the majority of you have never heard of I certainly hadn’t become aware of it up until really just recently and found out 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 employees between five and five hundred so I’ve got the expert with me this is Josh Fox he’s the founder and CEO of bottom line Concepts they’re the largest processor of these ERC credits this is a 170 page program so it’s not easy this isn’t like PPP we simply phone your bank manager and say give me a loan it doesn’t 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 ended up being yes the Ambassador and paid spokesperson for this I like this program it’s disappearing very soon you got to find out everything about it let’s talk employee retention credit Josh Fox what is an ERC let’s simply start there so during the Trump Administration when President Trump was enacted they developed the cares Act and the cares act used services 3 chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and almost everybody it makes a huge distinction right there 2 of them are loans and one’s a refund exactly so the ERC is a refund that’s.
remedy the cash money payroll tax refund alright go on sorry I just need to make certain we got that point I imply that’s a big distinction a loan versus money cash I like cash money that’s what we’re speaking 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 stunning hard check in the mail where you get actual money from the internal revenue service all right so let’s discuss how it works because it sounds like to me if it’s a if it’s staff member retention credit that person needed to be a staff member so I’m going to make the Assumption this money is not for the owner not for individuals on the cap table not for investors it’s for employees right you had to have actually owned a business however it’s based on you having W-2 employees in America not 10.99. 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 have to be on payroll for the very first six months of 2021 on the W-2 right 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 2 and three of 2021. alright so that’s how it’s determined you need to be on the W-2 throughout that period now let’s talk my favorite part cash just how much can you get back per employee that was on a W-2 in those 6 quarters so the computation in 2020 to be precise Kevin is 50 of the employee’s wage to an optimum of 5 thousand dollars per staff member for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the employee’s salary to an optimum of 7 thousand per quarter how did that happen um they simply changed the rules in.
2021 versus because the mayhem 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 approximately five thousand Max and then what occurs 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 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 money would need to be minimized from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan two you would decrease the 26 000 so what we’re seeing on average Kevin is if you took PPP cash someplace around ten thousand dollars an individual so let’s say hypothetically you owned a dining establishment in New York 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 internal revenue service so it’s huge obviously now the big question is why does nobody know about this since look when I first found out about this when I first fulfilled Josh you understand I’ve got lots of investments in great deals of companies I’m a major supporter for entrepreneurship in America and make numerous lots of investments in business owners of which lots of suffered through the pandemic when I first became aware of this I called BS I do not believe it since I utilize 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 should have and we utilized them carefully to stay alive during the pandemic so when I heard about this I said nah it can’t hold true but when I dug around I even contacted us to my politician buddies Guv Senators they didn’t understand about it I mean that’s how you understand that’s how misinformation is that there’s no information out there then a bunch of people 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 understand about the worker retention credit you know what’s intriguing you’re discussing the banks Kevin because in the PPP loan procedure the federal government made it very clear that if you desired 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 just process procedure that’s all um and here there was turmoil due to the fact that remember in the original cares act you might not do both programs so if you had done PPP you might refrain from doing ERC in the original program and when they changed the law in 2021 the banks were refraining from doing ERC because it’s not alone so you’re getting a tax refund so the federal government never made it clear to anybody about how to.
do this does your CFO understand how to do this not really he or she’s never done it before 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 ever done this before unless you have an account that entered into this company and bottom line my firm Kevin has stayed in business given that 2009 and we’ve been working with the federal government and the state federal government to recover cash for Fortune 500 Fortune 1000 business so a lot of our big huge corporate customers have actually worked with bottom line to recuperate other government programs we’ve done sales tax and use tax joblessness tax work chance tax credits research and development tax credits unclaimed property property tax all of these other federal government programs.
The staff member retention tax credit is a broad based refundable tax credit created to encourage.
employers to keep staff members on their payroll. The credit is 50% of up to $10,000 in incomes paid by an.
Due to the fact that of COVID-19 or whose gross invoices, company whose company is fully or partially suspended.
decline by more than 50%.
1. The credit is readily available to all employers regardless of size consisting of tax exempt organizations. There are.
only two exceptions: (1) state and city governments and their instrumentalities and (2) small.
companies who take Small company Loans.
2. To certify, the company needs to satisfy one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the employer’s organization is completely or partly suspended by government order due to COVID-19.
throughout the calendar quarter or.
o the employer’s gross invoices are below 50% of the comparable 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.
Estimation of the Credit.
The quantity of the credit is 50% of the certifying wages paid up to $10,000 in overall.
It works for incomes paid after March 13th and prior to December 31, 2020.
The definition of qualifying wages varies by whether an employer had, typically, basically than.
100 employees in 2019.
Companies that focus on ERC filing help usually supply know-how and assistance to assist companies browse the complex process of claiming the credit. They can offer numerous services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit Qualified Health Plan Expenses
Eligibility Evaluation: These business will evaluate your company’s eligibility for the ERC based upon aspects such as your market, revenue, and operations. They can help identify if you meet the requirements for the credit and recognize the optimum credit quantity you can claim.
Paperwork and Estimation: ERC filing services will assist in gathering the essential documents, such as payroll records and financial declarations, to support your claim. They will likewise assist calculate the credit amount based on eligible earnings and other qualifying costs.
Retroactive Claim Evaluation: If you are qualified to claim the ERC for previous quarters, these companies can evaluate your previous payroll records and financials to recognize potential opportunities for retroactive credits. They can help you change prior tax returns to declare these refunds.
Filing Help: Companies specializing in ERC filings will prepare and submit the necessary kinds and documentation in your place. This includes completing Form 941 or any other necessary tax forms.
Compliance and Updates: ERC policies and guidance have developed gradually. These business remain upgraded with the latest changes and guarantee that your filings abide by the most existing standards. They can likewise supply continuous support if the IRS demands additional info or carries out an audit related to your ERC claim.
It is very important to research study and veterinarian any company providing ERC filing support to ensure their trustworthiness and competence. Try to find established firms with experience in tax and payroll services, or consider reaching out to relied on accounting firms or tax specialists who use ERC filing assistance.
Remember that while these companies can offer valuable help, it’s always an excellent idea to have a fundamental understanding of the ERC requirements and procedure yourself. This will assist you make informed choices and guarantee accurate filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief steps. The objective of the ERC is to encourage services to keep and pay their staff members throughout the pandemic, even if their operations have actually been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is readily available to eligible companies, including for-profit businesses, tax-exempt organizations, and particular governmental entities. To certify, companies must meet one of two requirements:.
Business operations were completely or partly suspended due to a government order related to COVID-19.
The business experienced a considerable decline in gross invoices. As mentioned earlier, for 2021, a significant decrease is defined as a 20% decrease in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a significant decrease is defined as a 20% decrease in gross invoices compared to the same quarter in 2019, or a 20% decline in gross invoices compared to the instantly 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 percentage (as much as 70%) of certified salaries paid to employees, consisting of certain health insurance costs. The optimum credit per worker is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, services that got an Income Defense Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 allows companies to declare the ERC even if they received a PPP loan. However, the same incomes can not be utilized to claim both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has actually been retroactively expanded and improved, allowing eligible employers to claim the credit for qualified salaries paid as far back as March 13, 2020. This retroactive provision provides an opportunity for businesses to modify prior-year income tax return and receive refunds.
Claiming the Credit: Employers can claim the ERC by reporting it on their work tax returns, generally Kind 941. The excess can be reimbursed to the employer if the credit exceeds the quantity of work taxes owed.
It is necessary to keep in mind that the ERC provisions and eligibility requirements have evolved gradually. The best course of action is to seek advice from a tax professional or check out the main internal revenue service site for the most in-depth and up-to-date information concerning the ERC, consisting of any recent legislative modifications or updates.
To qualify for the ERC, a company must fulfill among the following criteria:.
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. For 2021, a substantial decline is defined as a 20% decline in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a considerable decline is specified as a 20% decrease in gross invoices compared to the same quarter in 2019, or a 20% decline in gross receipts compared to the instantly preceding quarter.
The ERC is offered to services of all sizes, including tax-exempt companies, but there are some exceptions. For example, federal government entities and companies that received a PPP loan may have constraints on declaring the credit.
The procedure for claiming the ERC includes completing the needed types and consisting of the credit on your employment income tax return (normally Type 941). The exact time it requires to process the credit can vary based on a number of elements, consisting of the intricacy of your company and the work of the IRS. It’s suggested to seek advice from a tax professional for guidance particular to your situation.
There are a number of business that can help with the procedure of claiming the ERC. These consist of accounting companies, tax advisory services, and payroll provider. Some well-known business that use help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s advisable to research and contact these companies directly to ask about their costs and services.
Please keep in mind that the info supplied here is based upon basic understanding and might not reflect the most current updates or changes to the ERC. It is essential to consult with a tax expert or visit the official IRS site for the most current and accurate information regarding eligibility, claiming procedures, and offered help.
Less than 100. The credit is based if the employer had 100 or fewer staff members on average in 2019.
on earnings paid to all staff members whether they in fact worked or not. To put it simply, even if the.
workers worked full-time and earned money for full time work, the employer still gets the credit.
Greater than 100. If the employer had more than 100 workers usually in 2019, then the credit is.
permitted just for incomes paid to employees who did not work throughout the calendar quarter.
In both cases, “salaries” consists of not just money payments however also a part of the cost of employer.
provided health care. Employee Retention Credit Qualified Health Plan Expenses
Companies can be instantly compensated for the credit by lowering the quantity of payroll taxes they.