Lets talk first about Employee Retention Credit Record Keeping :
Our group here what do these guys doing everybody in this space is helping teach individuals 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 companies and I wish to see that what is this this is uh numerous millions of dollars literally Kevin hundreds of millions of dollars so these are replicate copies of the letters that go to customers validating that the check is on the way I mean you understand if you simply begin 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 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 validated and the check is on the mail in the mail from the IRS heading to the consumer so that’s how you’re able to track it you understand when you
receive this you understand the check is opted for sure and that’s when they pay so they don’t pay anything until they really get the money they do not pay bottom line Wonder trust anything up until this letter is validated the check is on the way they transfer it into their bank account and they can truly rely on Wonder trust that the process has been completed and how many you think you have actually processed given that you started this we’re about 35 000 of these for
about 6 billion dollars wow so plainly they know what they’re doing and that’s what you require you require 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 Fantastic 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 definitely had not become aware of it until really recently and found out a lot about it because this is probably the lowest cost of capital for any small company anywhere
anytime if you have workers in between five and five hundred so I have actually got the specialist with me this is Josh Fox he’s the founder and CEO of bottom line Principles they’re the largest processor of these ERC credits this is a 170 page program so it’s hard this isn’t like PPP we simply call up your bank manager and state provide 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 ended up being yes the Ambassador and paid representative for this I love this program it’s going away very 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 throughout the Trump Administration when President Trump was enacted they came up with the cares Act and the cares act offered companies three 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 difference right there 2 of them are loans and one’s a refund exactly so the ERC is a refund that’s.
remedy the cash cash payroll tax refund fine go on sorry I simply have to make sure we got that point I indicate that’s a big distinction a loan versus cash 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 original 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 since it sounds like to me if it’s a if it’s worker retention credit that individual needed to be a worker 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 workers right you needed to have owned a service but 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 right so there were six quarters the program was open well walk us through the six quarters so you had quarters 2 3 and 4 of 2020 and you had quarters one 2 and three of 2021. alright so that’s how it’s determined you have to be on the W-2 during that period now let’s talk my favorite part money how much can you return per staff member that was on a W-2 in those 6 quarters so the estimation in 2020 to be exact Kevin is 50 of the staff member’s salary to a maximum of 5 thousand dollars per employee for the year of 2020 and in 2021 the numbers increased to 70 of the staff member’s income to an optimum of 7 thousand per quarter how did that occur um they simply altered the rules in.
2021 versus due to the fact that 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 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 great deal of cash it is now there’s a caution here the PPP money would need to be reduced from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan 2 you would reduce the 26 000 so what we’re seeing typically Kevin is if you took PPP money somewhere around ten thousand dollars an individual so let’s say 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 money you would still get a million dollar in the mail from the IRS so it’s huge certainly now the huge question is why does no one learn about this since look when I initially heard about this when I initially met Josh you know I have actually got lots of financial investments in great deals of companies I’m a major advocate for entrepreneurship in America and make lots of numerous financial investments in business owners of which numerous suffered through the pandemic when I first became aware of this I called BS I do not think it because I use the PPP we went through the cash 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 survive during the pandemic so when I found out about this I said nah it can’t hold true but when I dug around I even contacted us to my political leader good friends Governor Senators they didn’t learn about it I suggest that’s how you know that’s how false information is that there’s no information out there then a lot of people told me well you can’t get it because you took the PPP also not true so let’s ask Josh why does no one know about the employee retention credit you understand what’s intriguing you’re discussing 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 big 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 simply procedure procedure that’s all um and here there was chaos because remember in the initial cares act you might not do both programs so if you had actually done PPP you could not do ERC in the initial program and when they changed the law in 2021 the banks were not doing ERC because it’s not alone so you’re getting a tax refund so the federal government never ever made it clear to anybody about how to.
do this does your CFO know how to do this not really she or he’s never done it in the past do the banks do it nope the banks don’t do it the payroll business 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 actually stayed in business given that 2009 and we have actually been working with the federal government and the state government to recover cash for Fortune 500 Fortune 1000 business so a great deal of our huge big business clients have worked with bottom line to recover other federal government programs we’ve done sales tax and use tax unemployment tax work opportunity tax credits research and development tax credits unclaimed property real estate tax all of these other federal government programs.
The staff member retention tax credit is a broad based refundable tax credit developed to encourage.
employers to keep staff members on their payroll. The credit is 50% of as much as $10,000 in incomes paid by an.
Due to the fact that of COVID-19 or whose gross receipts, company whose organization is completely or partially suspended.
decrease by more than 50%.
1. The credit is readily available to all employers despite size including tax exempt organizations. There are.
just two exceptions: (1) state and city governments and their instrumentalities and (2) little.
organizations who take Small Business Loans.
2. To qualify, the employer has to fulfill one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the company’s business is fully or partly suspended by government order due to COVID-19.
during the calendar quarter or.
o the employer’s gross invoices are listed below 50% of the comparable quarter in 2019. As soon as the.
employer’s gross invoices go above 80% of an equivalent quarter in 2019 they no longer certify.
after completion of that quarter.
Computation of the Credit.
The amount of the credit is 50% of the qualifying incomes paid up to $10,000 in overall.
It works for earnings paid after March 13th and prior to December 31, 2020.
The definition of certifying salaries varies by whether an employer had, typically, more or less than.
100 staff members in 2019.
Companies that focus on ERC filing support typically provide know-how and assistance to assist companies browse the complex process of claiming the credit. They can use various services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit Record Keeping
Eligibility Assessment: These companies will examine your business’s eligibility for the ERC based on elements such as your industry, profits, and operations. They can assist identify if you satisfy the requirements for the credit and determine the optimum credit amount you can declare.
Documentation and Computation: ERC filing services will help in collecting the essential paperwork, such as payroll records and financial statements, to support your claim. They will also assist determine the credit amount based upon qualified wages and other qualifying expenditures.
Retroactive Claim Evaluation: If you are qualified to declare the ERC for previous quarters, these companies can review your past payroll records and financials to identify prospective chances for retroactive credits. They can assist you modify previous tax returns to declare these refunds.
Filing Help: Companies concentrating on ERC filings will prepare and send the essential types and documents in your place. This includes completing Kind 941 or any other required tax forms.
Compliance and Updates: ERC guidelines and assistance have actually developed over time. These companies stay upgraded with the current changes and guarantee that your filings adhere to the most current guidelines. They can likewise supply continuous support if the internal revenue service demands extra information or conducts an audit related to your ERC claim.
It is very important to research study and veterinarian any business using ERC filing help to guarantee their credibility and know-how. Look for established companies with experience in tax and payroll services, or consider connecting to trusted accounting firms or tax experts who offer ERC filing assistance.
Keep in mind that while these companies can provide important help, it’s constantly a great concept to have a standard understanding of the ERC requirements and procedure yourself. This will help you make notified decisions and ensure accurate filings.
The Employee Retention Credit (ERC) is a refundable tax credit introduced by the U.S. federal government as part of COVID-19 relief procedures. The objective of the ERC is to encourage services to retain and pay their employees throughout the pandemic, even if their operations have been affected.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is offered to eligible employers, consisting of for-profit businesses, tax-exempt organizations, and particular governmental entities. To certify, employers should fulfill one of two requirements:.
The business operations were fully or partly suspended due to a federal government order related to COVID-19.
The business experienced a significant decrease in gross invoices. As mentioned previously, for 2021, a considerable decrease is defined as a 20% decrease in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a significant decrease is defined as a 20% decline in gross receipts compared to the exact same quarter in 2019, or a 20% decrease in gross receipts compared to the right away preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the employer’s share of Social Security taxes. The credit quantity amounts to a portion (approximately 70%) of certified earnings paid to staff members, including specific 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, businesses that received a Paycheck Defense Program (PPP) loan were not qualified for the ERC. However, legislation passed in late 2020 and extended in 2021 allows organizations to claim the ERC even if they got a PPP loan. The very same earnings can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively broadened and improved, enabling eligible employers to declare the credit for qualified incomes paid as far back as March 13, 2020. This retroactive provision provides an opportunity for services to change prior-year income tax return and get refunds.
Declaring the Credit: Companies can claim the ERC by reporting it on their work tax returns, usually Type 941. The excess can be refunded to the company if the credit surpasses the quantity of employment taxes owed.
It is necessary to keep in mind that the ERC provisions and eligibility criteria have actually progressed gradually. The best strategy is to speak with a tax professional or visit the main IRS site for the most current and comprehensive info relating to the ERC, consisting of any recent legislative modifications or updates.
To get approved for the ERC, a business must satisfy among the following requirements:.
Business operations were completely or partly suspended due to a government order related to COVID-19.
The business experienced a significant decrease in gross invoices. For 2021, a substantial decline is defined as a 20% decline in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a substantial decrease 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 instantly preceding quarter.
The ERC is offered to services of all sizes, including tax-exempt organizations, however there are some exceptions. For instance, federal government entities and services that received a PPP loan might have limitations on declaring the credit.
The process for declaring the ERC involves completing the needed types and including the credit on your work tax return (generally Form 941). The exact time it takes to process the credit can vary based on several elements, including the intricacy of your company and the workload of the IRS. It’s suggested to speak with a tax expert for guidance specific to your circumstance.
There are numerous business that can assist with the procedure of declaring the ERC. Some popular companies that provide support with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the info provided here is based on general understanding and may not reflect the most current updates or changes to the ERC. It is very important to seek advice from a tax expert or visit the main internal revenue service site for the most accurate and updated info relating to eligibility, claiming treatments, and offered support.
Less than 100. The credit is based if the company had 100 or fewer employees on average in 2019.
on wages paid to all staff members whether they really worked or not. To put it simply, even if the.
staff members worked full time and got paid for full time work, the company still gets the credit.
Greater than 100. If the employer had more than 100 employees usually in 2019, then the credit is.
allowed just for earnings paid to workers who did not work during the calendar quarter.
In both cases, “salaries” includes not just cash payments however also a part of the expense of company.
provided health care. Employee Retention Credit Record Keeping
Companies can be instantly repaid for the credit by decreasing the amount of payroll taxes they.