Lets talk first about Employee Retention Credit Simplified :
Our group here what do these men doing everybody in this room is assisting teach individuals about ERC and uh constantly supply a stunning breakfast and have people truly learn about the program we should head to the room where we have the ability to show some of the checks that we are getting for companies and I want to see that what is this this is uh numerous countless dollars actually Kevin numerous countless dollars so these are duplicate copies of the letters that go to clients verifying that the check is on the method I mean you understand if you simply start to look at some 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 about how many real 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 consumer so that’s how you’re able to track it you know when you
get this you understand the check is opted for sure which’s when they pay so they do not pay anything till they really receive the cash they don’t pay bottom line Wonder trust anything till this letter is verified the check is on the method they deposit it into their checking account and they can really rely on Wonder trust that the procedure has actually been completed and the number of you think you have actually processed because you began this we have to do with 35 000 of these for
about 6 billion dollars wow so clearly they know what they’re doing which’s what you need you need 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 Fantastic here you’re at my YouTube channel we’re discussing something actually essential today the employee retention credit which most of you have never heard of I definitely had not heard of it till extremely just recently and learned a lot about it due to the fact that this is probably the most affordable cost of capital for any small company anywhere
anytime if you have employees in between five and five hundred so I’ve got the specialist with me this is Josh Fox he’s the creator and CEO of bottom line Concepts they’re the biggest processor of these ERC credits this is a 170 page program so it’s not easy this isn’t like PPP we simply call up your bank manager and say provide me a loan it does not work there’s not a loan it’s an application and Josh is going to tell all of us about it and how to get it and why I’ve ended up being yes the Ambassador and paid spokesperson for this I love this program it’s going away very soon you got to learn everything about it let’s talk worker retention credit Josh Fox what is an ERC let’s simply start there so during the Trump Administration when President Trump was enacted they came up with the cares Act and the cares act provided businesses 3 chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly everyone it makes a big difference right there 2 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 all right go on sorry I simply have to make sure we got that point I imply that’s a big difference a loan versus cash cash I like money cash that’s what we’re talking about all right 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 beautiful difficult check in the mail where you get actual cash from the internal revenue service all right so let’s discuss how it works due to the fact that it seems like to me if it’s a if it’s staff member retention credit that person needed to be a worker so I’m going to make the Assumption this money is not for the owner not for people on the cap table not for investors it’s for employees right you needed to have owned a company however it’s based on you having W-2 employees in America not 10.99. 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 have to be on payroll for the first six months of 2021 on the W-2 appropriate so there were six quarters the program was open well walk us through the 6 quarters so you had quarters 2 three and four of 2020 and you had quarters one 2 and three of 2021. fine so that’s how it’s determined 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 computation in 2020 to be precise Kevin is 50 of the worker’s income to a maximum of five thousand dollars per worker for the year of 2020 and in 2021 the numbers escalated to 70 of the employee’s wage to a maximum of 7 thousand per quarter how did that happen um they just altered the rules in.
2021 versus because the mayhem of the pandemic so they wanted 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 up to five thousand Max and after that what takes place 21 000 Max in 2021 oh that’s how you come up with twenty 6 thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty 6 thousand dollars per staff member that is because that’s a great deal of cash it is now there’s a caution here the PPP money would have to be lowered 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 on average Kevin is if you took PPP cash someplace around ten thousand dollars a person so let’s state hypothetically you owned a dining establishment in New York City where I’m from and you had a hundred workers and you took PPP money you would still get a million dollar in the mail from the IRS so it’s huge obviously now the huge concern is why does no one know about this because appearance when I first became aware of this when I first met Josh you know I have actually got lots of investments in great deals of companies I’m a significant supporter for entrepreneurship in America and make many numerous investments in business owners of which lots of suffered through the pandemic when I first heard about this I called BS I don’t think it due to the fact that I utilize 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 been worthy of and we utilized them wisely to stay alive throughout the pandemic so when I became aware of this I stated nah it can’t hold true however when I dug around I even contacted us to my political leader 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 info out there then a bunch 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 no one know about the employee retention credit you understand what’s interesting you’re talking about the banks Kevin because in the PPP loan procedure the federal government made it really clear that if you desired a PPP loan you would call Wells Fargo Citibank Bank of America any of the huge 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 procedure process that’s all um and here there was chaos because keep in mind in the original cares act you might not do both programs so if you had done PPP you could not do ERC in the original program and when they altered 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 made it clear to anybody about how to.
do this does your CFO know how to do this not really he or she’s never ever done it previously 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 business and bottom line my firm Kevin has actually stayed in business since 2009 and we have actually been working with the federal government and the state federal government to recuperate cash for Fortune 500 Fortune 1000 business so a lot of our huge big corporate customers have worked with bottom line to recuperate other federal government programs we’ve done sales tax and use tax unemployment tax work chance tax credits research and development tax credits unclaimed property property tax all of these other government programs.
The worker retention tax credit is a broad based refundable tax credit created to motivate.
employers to keep employees on their payroll. The credit is 50% of as much as $10,000 in earnings paid by an.
Due to the fact that of COVID-19 or whose gross receipts, company whose service is fully or partially suspended.
decrease by more than 50%.
1. The credit is readily available to all employers despite size consisting of tax exempt companies. There are.
just two exceptions: (1) state and local governments and their instrumentalities and (2) small.
organizations who take Small company Loans.
2. To qualify, the employer needs to fulfill one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the company’s organization is completely 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. When the.
employer’s gross invoices go above 80% of a comparable quarter in 2019 they no longer qualify.
after the end of that quarter.
Estimation of the Credit.
The amount of the credit is 50% of the certifying earnings paid up to $10,000 in total.
It works for earnings paid after March 13th and prior to December 31, 2020.
The definition of qualifying earnings differs by whether a company had, usually, basically than.
100 employees in 2019.
Business that focus on ERC filing support generally offer expertise and support to help companies browse the complicated procedure of claiming the credit. They can use various services, including:.
How is the employee retention credit calculated? Employee Retention Credit Simplified
Eligibility Assessment: These companies will examine your business’s eligibility for the ERC based upon factors such as your industry, profits, and operations. If you satisfy the requirements for the credit and recognize the optimum credit amount you can claim, they can help figure out.
Documents and Estimation: ERC filing services will help in gathering the essential documents, such as payroll records and financial declarations, to support your claim. They will likewise assist determine the credit amount based upon qualified earnings and other certifying expenses.
Retroactive Claim Review: If you are qualified to claim the ERC for prior quarters, these business can examine your previous payroll records and financials to recognize prospective chances for retroactive credits. They can assist you modify prior income tax return to claim these refunds.
Filing Support: Business concentrating on ERC filings will prepare and submit the required kinds and paperwork on your behalf. This includes completing Kind 941 or any other necessary tax return.
Compliance and Updates: ERC guidelines and guidance have actually evolved in time. These business stay updated with the latest modifications and ensure that your filings adhere to the most current guidelines. If the Internal revenue service demands extra info or conducts an audit related to your ERC claim, they can likewise provide continuous support.
It is very important to research and vet any company offering ERC filing assistance to guarantee their trustworthiness and expertise. Search for established firms with experience in tax and payroll services, or think about connecting to relied on accounting companies or tax professionals who use ERC submitting assistance.
Bear in mind that while these companies can offer important assistance, it’s constantly a great idea to have a standard understanding of the ERC requirements and procedure yourself. This will help you make notified decisions and ensure precise filings.
The Employee Retention Credit (ERC) is a refundable tax credit presented by the U.S. government as part of COVID-19 relief procedures. The goal of the ERC is to motivate companies to retain and pay their workers during the pandemic, even if their operations have been impacted.
Here are some key points about the ERC:.
Eligibility: The ERC is readily available to qualified employers, consisting of for-profit organizations, tax-exempt companies, and particular governmental entities. To qualify, companies must fulfill one of two criteria:.
The business operations were totally or partially suspended due to a government order related to COVID-19.
Business experienced a considerable decrease in gross receipts. As discussed previously, for 2021, a significant decrease is defined as a 20% decrease in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a considerable decline is defined as a 20% decline in gross invoices compared to the exact 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 employer’s share of Social Security taxes. The credit amount is equal to a portion (as much as 70%) of qualified incomes paid to employees, 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, companies that received an Income Defense Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 permits businesses to declare 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 enhanced, allowing eligible companies to declare the credit for certified incomes paid as far back as March 13, 2020. This retroactive provision supplies a chance for services to modify prior-year tax returns and get refunds.
Declaring the Credit: Companies can declare the ERC by reporting it on their employment income tax return, usually Kind 941. If the credit goes beyond the amount of employment taxes owed, the excess can be refunded to the company.
It is very important to note that the ERC arrangements and eligibility requirements have developed gradually. The very best course of action is to speak with a tax professional or check out the official IRS website for the most updated and comprehensive details relating to the ERC, consisting of any recent legislative modifications or updates.
To get approved for the ERC, a service needs to 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 considerable decline in gross invoices. For 2021, a considerable decrease is specified as a 20% decline in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a considerable decrease 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 right away preceding quarter.
The ERC is available to organizations of all sizes, consisting of tax-exempt organizations, however there are some exceptions. Federal government entities and companies that received a PPP loan might have constraints on claiming the credit.
The process for claiming the ERC includes finishing the needed forms and including the credit on your work tax return (normally Form 941). The exact time it takes to process the credit can differ based on several elements, including the complexity of your business and the work of the internal revenue service. It’s advised to speak with a tax expert for guidance specific to your situation.
There are a number of companies that can help with the process of declaring the ERC. Some widely known business that offer support with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the info offered here is based upon general understanding and may not reflect the most current updates or modifications to the ERC. It is essential to speak with a tax professional or visit the official internal revenue service website for the most precise and up-to-date details regarding eligibility, claiming treatments, and offered support.
Less than 100. The credit is based if the employer had 100 or less staff members on average in 2019.
on earnings paid to all staff members whether they actually worked or not. To put it simply, even if the.
employees worked full time and got paid for full time work, the employer still gets the credit.
Greater than 100. If the company had more than 100 employees typically in 2019, then the credit is.
allowed just for incomes paid to employees who did not work throughout the calendar quarter.
In both cases, “earnings” includes not simply money payments but likewise a part of the expense of employer.
supplied healthcare. Employee Retention Credit Simplified
Companies can be immediately reimbursed for the credit by decreasing the quantity of payroll taxes they.