Lets talk first about Employee Retention Credit Third Quarter 2021 :
Our group here what do these guys doing everybody in this room is assisting teach individuals about ERC and uh always offer a lovely breakfast and have people really learn more about the program we should head to the room where we are able to show some of the checks that we are getting for companies and I wish to see that what is this this is uh hundreds of millions of 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 way I imply you know if you just begin to take a 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 mean it’s simply I indicate think of how many real clients that went through the program yeah this is the very end this is the party 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 consumer so that’s how you’re able to track it you know when you
get this you know the check is opted for sure and that’s when they pay so they don’t pay anything up until they really receive the cash they don’t pay bottom line Wonder trust anything up until this letter is validated the check is on the method they deposit it into their savings account and they can really rely on Wonder trust that the procedure has actually been ended up and the number of you think you have actually processed because you began this we’re about 35 000 of these for
about 6 billion dollars wow so clearly they know what they’re doing and that’s what you need you need 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 Wonderful here you’re at my YouTube channel we’re discussing something actually crucial today the staff member retention credit which the majority of you have actually never ever become aware of I definitely hadn’t heard of it up until extremely recently and found out a lot about it because this is probably the most affordable expense of capital for any small business anywhere
anytime if you have workers between five and five hundred so I have actually got the expert with me this is Josh Fox he’s the creator 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 just phone your bank manager and state offer me a loan it does not 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 have actually become yes the Ambassador and paid spokesperson for this I like this program it’s disappearing very soon you got to learn everything about it let’s talk worker retention credit Josh Fox what is an ERC let’s just start there so throughout the Trump Administration when President Trump was enacted they came up with the cares Act and the cares act provided businesses three chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly everybody it makes a big distinction right there two of them are loans and one’s a refund exactly so the ERC is a refund that’s.
correct the money money payroll tax refund fine go on sorry I simply need to make sure we got that point I mean that’s a huge difference a loan versus cash cash 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 stunning hard check in the mail where you get real money from the internal revenue service all right so let’s talk about how it works because it seems like to me if it’s a if it’s worker retention credit that individual needed to be an employee so I’m going to make the Assumption this money is not for the owner not for people on the cap table not for shareholders it’s for staff members right you had to have actually owned an organization but it’s based on you having W-2 employees in America not 10.99. so as long as you had W-2 staff members and you paid federal payroll taxes that’s why you would be qualified so you need to be on payroll in 2020 on the W-2 and you need to be on payroll for the first 6 months of 2021 on the W-2 proper so there were 6 quarters the program was open well stroll us through the six quarters so you had quarters 2 three and four of 2020 and you had quarters one two and 3 of 2021. fine so that’s how it’s determined 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 exact Kevin is 50 of the staff member’s income to an optimum of 5 thousand dollars per employee for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the staff member’s salary to a maximum of seven thousand per quarter how did that occur um they simply altered the rules in.
2021 versus due to the fact that the mayhem of the pandemic so they wanted to even get more to keep those staff members on payroll 100 so if you can get 5 000 per person Max in twenty that was 50 in 2020 up to 5 thousand Max and after that what happens 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 worker that is since that’s a lot of money it is now there’s a caveat here the PPP cash would have to be lowered from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan two you would lower the 26 000 so what we’re seeing typically Kevin is if you took PPP cash 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 workers 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 huge concern is why does nobody understand about this since appearance when I initially became aware of this when I initially fulfilled Josh you understand I have actually got lots of investments in lots of business I’m a significant advocate for entrepreneurship in America and make numerous numerous financial investments in business owners of which numerous suffered through the pandemic when I initially became aware of this I called BS I don’t think 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 which were well been worthy of and we utilized them sensibly to stay alive throughout the pandemic so when I became aware of this I stated nah it can’t be true but when I dug around I even contacted us to my politician friends Guv Senators they didn’t understand about it I imply that’s how you know that’s how misinformation is that there’s no details out there then a lot of people told me well you can’t get it since you took the PPP also not true so let’s ask Josh why does no one know about the worker retention credit you understand what’s interesting you’re discussing 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 chaos due to the fact that remember in the initial cares act you could not do both programs so if you had actually done PPP you might refrain from doing ERC in the original program and when they altered 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 government never made it clear to any person about how to.
do this does your CFO know how to do this not truly 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 some of them are doing it as a payroll company your accountant no your accounting professional’s never done this before unless you have an account that entered into this company and bottom line my firm Kevin has been in business because 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 joblessness 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 designed to motivate.
employers to keep employees on their payroll. The credit is 50% of approximately $10,000 in incomes paid by an.
employer whose business is fully or partly suspended because of COVID-19 or whose gross receipts.
decrease by more than 50%.
1. The credit is offered to all companies despite size including tax exempt organizations. There are.
only 2 exceptions: (1) state and city governments and their instrumentalities and (2) little.
businesses who take Small Business 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 company is fully or partially suspended by federal government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross invoices are below 50% of the equivalent quarter in 2019. When the.
employer’s gross invoices exceed 80% of a similar 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 wages paid up to $10,000 in overall.
It works for salaries paid after March 13th and before December 31, 2020.
The definition of certifying salaries varies by whether a company had, usually, basically than.
100 staff members in 2019.
Business that focus on ERC filing support typically provide proficiency and assistance to help businesses browse the complicated process of declaring the credit. They can provide different services, including:.
How is the employee retention credit calculated? Employee Retention Credit Third Quarter 2021
Eligibility Evaluation: These companies will assess your organization’s eligibility for the ERC based upon factors such as your industry, income, and operations. If you fulfill the requirements for the credit and determine the optimum credit quantity you can claim, they can assist figure out.
Documentation and Calculation: ERC filing services will help in collecting the essential paperwork, such as payroll records and monetary declarations, to support your claim. They will likewise assist determine the credit quantity based on qualified incomes and other certifying costs.
Retroactive Claim Review: If you are qualified to claim the ERC for prior quarters, these companies can examine your past payroll records and financials to identify possible opportunities for retroactive credits. They can help you amend prior tax returns to declare these refunds.
Filing Assistance: Business concentrating on ERC filings will prepare and submit the needed kinds and documentation on your behalf. This consists of completing Kind 941 or any other necessary tax return.
Compliance and Updates: ERC guidelines and guidance have actually evolved gradually. These companies remain updated with the most recent modifications and ensure that your filings abide by the most present guidelines. If the IRS demands extra details or carries out an audit associated to your ERC claim, they can also offer ongoing assistance.
It’s important to research and vet any company offering ERC filing help to ensure their credibility and competence. Look for recognized companies with experience in tax and payroll services, or consider reaching out to relied on accounting companies or tax experts who offer ERC submitting support.
Keep in mind that while these companies can offer valuable help, it’s constantly a good concept to have a fundamental understanding of the ERC requirements and procedure yourself. This will help you make notified choices and ensure precise filings.
The Employee Retention Credit (ERC) is a refundable tax credit introduced by the U.S. federal government as part of COVID-19 relief measures. The objective of the ERC is to encourage companies to retain and pay their employees during the pandemic, even if their operations have actually been affected.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is offered to eligible companies, consisting of for-profit companies, tax-exempt companies, and specific governmental entities. To certify, companies need to fulfill one of two requirements:.
The business operations were completely or partially suspended due to a federal government order related to COVID-19.
Business experienced a significant decrease in gross invoices. As discussed earlier, for 2021, a substantial decrease is defined as a 20% decrease in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a considerable decline is defined as a 20% decrease in gross invoices compared to the exact same quarter in 2019, or a 20% decrease in gross invoices compared to the immediately 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 percentage (up to 70%) of certified salaries paid to employees, including certain health plan expenses. The optimum credit per worker is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: At first, organizations that received an Income Protection Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 enables organizations to declare the ERC even if they got a PPP loan. The exact same incomes can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively expanded and enhanced, enabling qualified employers to claim the credit for qualified incomes paid as far back as March 13, 2020. This retroactive arrangement offers an opportunity for organizations to amend prior-year tax returns and receive refunds.
Declaring the Credit: Employers can declare the ERC by reporting it on their work tax returns, usually Kind 941. The excess can be refunded to the employer if the credit surpasses the amount of work taxes owed.
It is essential to keep in mind that the ERC arrangements and eligibility requirements have developed gradually. The best course of action is to talk to a tax expert or go to the official internal revenue service website for the most current and in-depth info relating to the ERC, consisting of any current legal modifications or updates.
To qualify for the ERC, an organization should meet among the following criteria:.
Business operations were completely or partially suspended due to a government order related to COVID-19.
The business experienced a significant decrease in gross invoices. For 2021, a considerable decrease 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 defined as a 20% decrease in gross receipts 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, consisting of tax-exempt organizations, but there are some exceptions. Government entities and businesses that got a PPP loan may have constraints on claiming the credit.
The process for claiming the ERC includes finishing the essential kinds and consisting of the credit on your work tax return (normally Type 941). The exact time it takes to process the credit can differ based upon numerous aspects, including the intricacy of your company and the work of the internal revenue service. It’s advised to speak with a tax expert for assistance specific to your situation.
There are several companies that can assist with the process of claiming the ERC. Some popular business that provide assistance with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the details provided here is based on general understanding and might not show the most recent updates or modifications to the ERC. It’s important to talk to a tax professional or visit the official internal revenue service website for the most accurate and current information concerning eligibility, claiming procedures, and offered assistance.
Less than 100. If the company had 100 or less staff members usually in 2019, then the credit is based.
on incomes paid to all employees whether they in fact worked or not. In other words, even if the.
employees worked full time and earned money for full-time work, the employer still gets the credit.
Greater than 100. The credit is if the company had more than 100 workers on average in 2019.
permitted just for incomes paid to employees who did not work during the calendar quarter.
In both cases, “earnings” consists of not simply cash payments however likewise a portion of the cost of employer.
offered health care. Employee Retention Credit Third Quarter 2021
Employers can be instantly reimbursed for the credit by minimizing the amount of payroll taxes they.