Lets talk first about How To Claim Employee Retention Credit 2021 :
Our group here what do these men doing everybody in this space is helping teach people about ERC and uh always offer a stunning breakfast and have people truly learn about the program we ought to head to the space where we are able to display some of the checks that we are getting for companies and I ‘d like to see that what is this this is uh numerous countless dollars literally Kevin numerous millions of dollars so these are duplicate copies of the letters that go to clients verifying that the check is on the method I mean you know 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 think about how many 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 IRS heading to the client so that’s how you have the ability to track it you know when you
get this you know the check is chosen sure which’s when they pay so they do not pay anything up until they actually receive the cash 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 savings account and they can genuinely rely on Wonder trust that the procedure has actually been ended up and the number of you believe you’ve processed since you started this we have to do with 35 000 of these for
about six billion dollars wow so clearly they understand 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 one of these that’s what matters all right Mr Terrific 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 heard of I definitely hadn’t heard of it up until very recently and learned a lot about it due to the fact that this is most likely the most affordable expense of capital for any small company anywhere
anytime if you have workers between 5 and five hundred so I’ve got the professional with me this is Josh Fox he’s the founder and CEO of bottom line Ideas they’re the biggest 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 say give me a loan it doesn’t 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 become yes the Ambassador and paid spokesperson for this I like this program it’s disappearing very soon you got to discover all 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 created 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 practically everyone it makes a big distinction right there 2 of them are loans and one’s a refund exactly so the ERC is a refund that’s.
fix the cash cash payroll tax refund okay go on sorry I just have to ensure we got that point I suggest that’s a huge distinction a loan versus cash cash I like money cash that’s what we’re discussing 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 lovely difficult check in the mail where you get actual cash from the IRS all right so let’s talk about how it works because it sounds like to me if it’s a if it’s worker retention credit that individual had 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 shareholders it’s for staff members right you had to have actually owned a business but it’s based upon you having W-2 staff members in America not 10.99. As long as you had W-2 staff members 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 six quarters so you had quarters 2 three and 4 of 2020 and you had quarters one 2 and three of 2021. all right so that’s how it’s measured you have to be on the W-2 during that duration now let’s talk my favorite part cash just how much can you get back per worker that was on a W-2 in those 6 quarters so the calculation in 2020 to be exact Kevin is 50 of the staff member’s income to an optimum of 5 thousand dollars per staff member for the year of 2020 and in 2021 the numbers increased to 70 of the staff member’s wage to a maximum of 7 thousand per quarter how did that occur um they just altered 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 up to five thousand Max and after that what happens 21 000 Max in 2021 oh that’s how you come up with twenty six thousand twenty one thousand to twenty twenty one plus five thousand in twenty twenty that’s twenty 6 thousand dollars per staff member that is since that’s a lot of cash it is now there’s a caution here the PPP cash would need to be reduced from the twenty six thousand dollars so if you took PPP loan one and PPP loan two you would minimize the 26 000 so what we’re seeing usually Kevin is if you took PPP money someplace around ten thousand dollars an individual so let’s state hypothetically you owned a dining establishment in New york city City where I’m from and you had a hundred staff members and you took PPP cash you would still get a million dollar in the mail from the internal revenue service so it’s substantial clearly now the huge concern is why does no one learn about this since appearance when I initially heard about this when I initially fulfilled Josh you know I have actually got great deals of investments in great deals of companies I’m a major advocate for entrepreneurship in America and make lots of lots of financial investments in business owners of which numerous suffered through the pandemic when I initially heard about this I called BS I don’t believe it because 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 which were well been worthy of and we used them wisely to stay alive during the pandemic so when I became aware of this I said nah it can’t hold true but when I dug around I even called to my political leader friends Guv Senators they didn’t understand about it I imply that’s how you know that’s how false information is that there’s no information out there then a bunch of people informed me well you can’t get it since you took the PPP likewise not real so let’s ask Josh why does no one learn about the employee retention credit you know what’s interesting you’re talking about the banks Kevin since in the PPP loan procedure the federal government made it extremely 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 simply process process that’s all um and here there was mayhem due to the fact that 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 refraining from doing ERC due to the fact that it’s not alone so you’re getting a tax refund so the federal government never ever 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 before 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 went into this business and bottom line my company Kevin has been in business since 2009 and we’ve been working with the federal government and the state federal government to recuperate money for Fortune 500 Fortune 1000 companies so a great deal of our huge 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 opportunity tax credits research and development tax credits unclaimed home real estate tax all of these other government programs.
The employee retention tax credit is a broad based refundable tax credit designed to encourage.
companies to keep employees on their payroll. The credit is 50% of approximately $10,000 in salaries paid by an.
company whose service is fully or partially suspended because of COVID-19 or whose gross invoices.
decline by more than 50%.
1. The credit is offered to all companies no matter size consisting of tax exempt organizations. There are.
only 2 exceptions: (1) state and local governments and their instrumentalities and (2) little.
organizations who take Small company Loans.
2. To certify, the company needs to satisfy one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the company’s organization is totally or partially suspended by federal government order due to COVID-19.
throughout the calendar quarter or.
o the employer’s gross receipts are listed below 50% of the similar quarter in 2019. As soon as the.
employer’s gross invoices exceed 80% of a similar quarter in 2019 they no longer certify.
after the end of that quarter.
Estimation of the Credit.
The amount of the credit is 50% of the qualifying incomes paid up to $10,000 in overall.
It works for incomes paid after March 13th and prior to December 31, 2020.
The meaning of qualifying incomes varies by whether a company had, typically, more or less than.
100 workers in 2019.
Business that concentrate on ERC filing help generally supply competence and support to help companies browse the complicated process of claiming the credit. They can provide numerous services, including:.
How is the employee retention credit calculated? How To Claim Employee Retention Credit 2021
Eligibility Assessment: These companies will assess your company’s eligibility for the ERC based upon elements such as your market, profits, and operations. They can assist identify if you meet the requirements for the credit and recognize the maximum credit quantity you can declare.
Paperwork and Calculation: ERC filing services will help in collecting the essential documents, such as payroll records and financial declarations, to support your claim. They will likewise help compute the credit quantity based upon qualified wages and other certifying expenses.
Retroactive Claim Evaluation: If you are eligible to claim the ERC for previous quarters, these companies can examine your previous payroll records and financials to determine possible chances for retroactive credits. They can assist you change previous tax returns to declare these refunds.
Filing Assistance: Companies specializing in ERC filings will prepare and submit the required forms and paperwork in your place. This consists of completing Kind 941 or any other necessary tax return.
Compliance and Updates: ERC guidelines and assistance have actually developed over time. These business stay updated with the most recent modifications and guarantee that your filings abide by the most existing guidelines. They can likewise offer ongoing assistance if the internal revenue service demands extra details or carries out an audit related to your ERC claim.
It’s important to research study and vet any company providing ERC filing help to guarantee their credibility and competence. Try to find recognized firms with experience in tax and payroll services, or think about connecting to relied on accounting firms or tax experts who provide ERC submitting assistance.
Keep in mind that while these companies can provide valuable help, it’s constantly an excellent idea to have a fundamental understanding of the ERC requirements and procedure yourself. This will assist you make notified choices and make sure precise filings.
The Worker Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief measures. The objective of the ERC is to encourage companies to maintain and pay their staff members throughout the pandemic, even if their operations have been affected.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is readily available to qualified companies, consisting of for-profit companies, tax-exempt organizations, and certain governmental entities. To certify, companies need to satisfy one of two requirements:.
Business operations were fully or partially suspended due to a federal government order related to COVID-19.
Business experienced a considerable decline in gross receipts. As pointed out previously, for 2021, a substantial decrease is defined as a 20% decline in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a substantial decrease is specified as a 20% decline in gross invoices compared to the exact same quarter in 2019, or a 20% decline in gross receipts compared to the immediately preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit quantity is equal to a portion (up to 70%) of certified salaries paid to workers, including specific health insurance costs. The maximum credit per worker is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, organizations that received an Income Security Program (PPP) loan were not qualified for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 allows services to declare the ERC even if they received a PPP loan. Nevertheless, the very same incomes can not be utilized to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively expanded and boosted, permitting eligible companies to declare the credit for certified wages paid as far back as March 13, 2020. This retroactive arrangement provides a chance for companies to amend prior-year tax returns and get refunds.
Declaring the Credit: Employers can claim the ERC by reporting it on their employment income tax return, generally Form 941. If the credit surpasses the quantity of employment taxes owed, the excess can be refunded to the employer.
It is essential to keep in mind that the ERC provisions and eligibility criteria have actually evolved in time. The best course of action is to seek advice from a tax expert or visit the main internal revenue service site for the most current and comprehensive info concerning the ERC, consisting of any recent legislative modifications or updates.
To qualify for the ERC, a company needs to meet among the following criteria:.
Business operations were completely or partially suspended due to a government order related to COVID-19.
Business experienced a significant decline in gross receipts. For 2021, a substantial 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% decrease in gross receipts compared to the exact same quarter in 2019, or a 20% decline in gross receipts compared to the instantly preceding quarter.
The ERC is readily available to organizations of all sizes, consisting of tax-exempt companies, but there are some exceptions. For instance, federal government entities and organizations that received a PPP loan may have constraints on declaring the credit.
The process for declaring the ERC involves finishing the needed forms and consisting of the credit on your employment tax return (normally Type 941). The exact time it takes to process the credit can differ based on numerous aspects, consisting of the intricacy of your company and the workload of the internal revenue service. It’s suggested to consult with a tax expert for assistance particular to your situation.
There are a number of companies that can help with the procedure of declaring the ERC. Some widely known companies that offer assistance with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the info supplied here is based on basic understanding and may not show the most recent updates or modifications to the ERC. It is very important to consult with a tax professional or check out the main internal revenue service site for the most current and precise details concerning eligibility, claiming treatments, and readily available help.
Less than 100. If the company had 100 or fewer staff members typically in 2019, then the credit is based.
on earnings paid to all staff members whether they actually worked or not. In other words, even if the.
workers worked full time and earned money for full time work, the company still gets the credit.
Greater than 100. The credit is if the employer had more than 100 staff members on average in 2019.
enabled only for incomes paid to employees who did not work throughout the calendar quarter.
In both cases, “incomes” consists of not just cash payments but also a portion of the cost of company.
supplied health care. How To Claim Employee Retention Credit 2021
Companies can be immediately compensated for the credit by reducing the quantity of payroll taxes they.