Lets talk first about How To Claim Employee Retention Credit Retroactively :
Our team here what do these people doing everyone in this room is assisting teach individuals about ERC and uh always supply a stunning breakfast and have people really learn about the program we must head to the space where we are able to show a few of the checks that we are getting for companies and I want to see that what is this this is uh hundreds of countless dollars actually Kevin numerous millions of dollars so these are replicate copies of the letters that go to customers verifying that the check is on the way I mean you understand if you simply begin to look at a few of these here I indicate this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I indicate it’s just I mean think of 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 verified the numbers are confirmed and the check is on the mail in the mail from the IRS heading to the consumer so that’s how you have the ability to track it you know when you
receive this you know the check is chosen sure and that’s when they pay so they don’t pay anything until they really receive the money they do not pay bottom line Wonder trust anything till this letter is validated the check is on the method they transfer it into their checking account and they can truly rely on Wonder trust that the procedure has actually been completed and the number of you believe you’ve processed because you began this we have to do with 35 000 of these for
about 6 billion dollars wow so plainly they know what they’re doing and that’s what you need you need specialists 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 actually crucial today the employee retention credit which most of you have actually never ever heard of I definitely had not heard of it up until really just recently and discovered a lot about it since this is most likely the lowest cost of capital for any small company anywhere
anytime if you have staff members between five and five hundred so I’ve got the professional with me this is Josh Fox he’s the creator and CEO of bottom line Principles 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 phone 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 tell us all about it and how to get it and why I’ve become yes the Ambassador and paid spokesperson for this I enjoy this program it’s going away soon you got to find out all about it let’s talk employee retention credit Josh Fox what is an ERC let’s just start there so during the Trump Administration when President Trump was enacted they created the cares Act and the cares act provided services 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 huge difference right there two of them are loans and one’s a refund exactly so the ERC is a refund that’s.
remedy the money cash payroll tax refund alright go on sorry I simply have to make certain we got that point I mean that’s a big difference a loan versus money money I like money cash 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 initial cares Act is the ERC and yes Kevin it is a lovely hard check in the mail where you get actual money from the IRS all right so let’s speak about how it works because it seems like to me if it’s a if it’s staff member retention credit that person had to be a staff member 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 had to have owned an organization but it’s based on you having W-2 employees 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 first 6 months of 2021 on the W-2 right so there were 6 quarters the program was open well walk us through the six quarters so you had quarters two three and 4 of 2020 and you had quarters one two and three of 2021. okay 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 cash how much can you return per staff member that was on a W-2 in those 6 quarters so the calculation in 2020 to be specific Kevin is 50 of the worker’s salary to an optimum of five 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 happen um they just altered the rules in.
2021 versus due to the fact that the chaos of the pandemic so they wished 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 as much as five thousand Max and then what occurs 21 000 Max in 2021 oh that’s how you develop twenty six thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty six thousand dollars per worker that is because that’s a great deal of money it is now there’s a caveat here the PPP money would need to be decreased from the twenty six thousand dollars so if you took PPP loan one and PPP loan two you would reduce the 26 000 so what we’re seeing usually Kevin is if you took PPP cash 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 workers and you took PPP money you would still get a million dollar in the mail from the IRS so it’s big obviously now the big concern is why does no one understand about this due to the fact that look when I first found out about this when I initially met Josh you understand I’ve got great deals of financial investments in lots of business I’m a major supporter for entrepreneurship in America and make many numerous investments in entrepreneurs of which many suffered through the pandemic when I first became aware of this I called BS I don’t believe it because I utilize the PPP we went through the money center Banks to get it it was extremely easy to do we had our CEOs call the banks they got their loans which were well been worthy of and we used them sensibly 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 called to my politician pals Guv Senators they didn’t know about it I imply that’s how you understand that’s how misinformation is that there’s no details out there then a lot of individuals told me well you can’t get it due to the fact that you took the PPP likewise not real so let’s ask Josh why does no one understand about the employee retention credit you understand what’s interesting you’re discussing the banks Kevin because in the PPP loan procedure 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 huge banks in our country and they would process process 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 mayhem due to the fact that remember in the initial cares act you could 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 because it’s not alone so you’re getting a tax refund so the federal government never made it clear to any person about how to.
do this does your CFO understand how to do this not actually she or he’s never done it previously do the banks do it nope the banks do not do it the payroll companies yeah some of them are doing it as a payroll business your accountant no your accounting professional’s never ever done this before unless you have an account that went into this company and bottom line my company Kevin has actually been in business given that 2009 and we have actually been working with the federal government and the state federal government to recover cash for Fortune 500 Fortune 1000 business so a great deal of our big big corporate clients have worked with bottom line to recover other government programs we’ve done sales tax and use tax unemployment tax work chance tax credits research and development tax credits unclaimed home property tax all of these other government programs.
The worker retention tax credit is a broad based refundable tax credit created to motivate.
companies to keep employees on their payroll. The credit is 50% of approximately $10,000 in wages paid by an.
company whose business is totally or partially suspended because of COVID-19 or whose gross receipts.
decrease by more than 50%.
1. The credit is offered to all employers regardless of size consisting of tax exempt organizations. There are.
only 2 exceptions: (1) state and local governments and their instrumentalities and (2) small.
services who take Small company Loans.
2. To certify, the company has to fulfill one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the employer’s business is completely or partially suspended by federal government order due to COVID-19.
throughout the calendar quarter or.
o the employer’s gross invoices are below 50% of the similar quarter in 2019. Once the.
employer’s gross invoices go above 80% of a comparable quarter in 2019 they no longer certify.
after the end of that quarter.
Calculation of the Credit.
The quantity of the credit is 50% of the qualifying salaries paid up to $10,000 in total.
It is effective for salaries paid after March 13th and before December 31, 2020.
The meaning of qualifying incomes varies by whether an employer had, typically, basically than.
100 staff members in 2019.
Business that focus on ERC filing assistance generally offer know-how and assistance to help companies navigate the complicated procedure of claiming the credit. They can use numerous services, consisting of:.
How is the employee retention credit calculated? How To Claim Employee Retention Credit Retroactively
Eligibility Assessment: These business will examine your organization’s eligibility for the ERC based upon aspects such as your industry, income, and operations. If you meet the requirements for the credit and recognize the maximum credit amount you can claim, they can assist determine.
Documentation and Calculation: ERC filing services will assist in gathering the required documents, such as payroll records and monetary statements, to support your claim. They will likewise help calculate the credit quantity based on qualified incomes and other certifying expenses.
Retroactive Claim Evaluation: If you are eligible to declare the ERC for prior quarters, these companies can review your previous payroll records and financials to recognize potential chances for retroactive credits. They can help you modify previous tax returns to declare these refunds.
Filing Assistance: Business specializing in ERC filings will prepare and send the needed types and documents on your behalf. This consists of completing Form 941 or any other required tax forms.
Compliance and Updates: ERC policies and guidance have progressed over time. These business stay upgraded with the most recent changes and guarantee that your filings adhere to the most current standards. They can also offer ongoing support if the IRS demands additional details or performs an audit related to your ERC claim.
It is essential to research and vet any business offering ERC filing support to guarantee their credibility and expertise. Look for recognized companies with experience in tax and payroll services, or think about reaching out to trusted accounting companies or tax professionals who use ERC submitting support.
Keep in mind that while these companies can offer important support, it’s always a great idea to have a standard understanding of the ERC requirements and process yourself. This will assist you make informed choices and make sure accurate filings.
The Employee Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief measures. The goal of the ERC is to motivate services to maintain and pay their employees throughout the pandemic, even if their operations have been impacted.
Here are some key points about the ERC:.
Eligibility: The ERC is offered to eligible employers, including for-profit businesses, tax-exempt organizations, and certain governmental entities. To certify, employers need to fulfill one of two criteria:.
Business operations were fully or partially suspended due to a government order related to COVID-19.
The business experienced a considerable decline in gross invoices. As pointed out previously, for 2021, a significant decrease is defined as a 20% decrease in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a considerable decrease is specified 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 employer’s share of Social Security taxes. The credit amount is equal to a percentage (approximately 70%) of certified wages paid to employees, including particular health plan expenses. 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, services that received a Paycheck Security Program (PPP) loan were not qualified for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 allows companies 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 Provision: The ERC has been retroactively expanded and boosted, permitting qualified companies to claim the credit for qualified incomes paid as far back as March 13, 2020. This retroactive arrangement supplies an opportunity for organizations to modify prior-year tax returns and get refunds.
Claiming the Credit: Employers can declare the ERC by reporting it on their work tax returns, usually Type 941. The excess can be refunded to the employer if the credit exceeds the amount of employment taxes owed.
It is very important to note that the ERC arrangements and eligibility requirements have progressed gradually. The very best strategy is to talk to a tax expert or visit the main internal revenue service site for the most updated and in-depth details regarding the ERC, consisting of any recent legal changes or updates.
To get approved for the ERC, a service should meet among the following requirements:.
Business operations were fully or partially suspended due to a government order related to COVID-19.
Business experienced a considerable decrease in gross invoices. For 2021, a considerable decline is specified as a 20% decline in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a significant decline is defined as a 20% decline in gross receipts compared to the same quarter in 2019, or a 20% decrease in gross invoices compared to the immediately preceding quarter.
The ERC is offered to organizations of all sizes, consisting of tax-exempt companies, however there are some exceptions. For instance, federal government entities and companies that received a PPP loan may have limitations on declaring the credit.
The process for declaring the ERC includes completing the needed kinds and consisting of the credit on your work income tax return (usually Type 941). The exact time it requires to process the credit can differ based upon numerous aspects, including the intricacy of your organization and the work of the IRS. It’s suggested to consult with a tax professional for assistance specific to your circumstance.
There are a number of business that can help with the procedure of claiming the ERC. Some well-known companies that provide assistance with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the info provided here is based on basic knowledge and may not show the most current updates or modifications to the ERC. It’s important to consult with a tax professional or go to the official IRS site for the most up-to-date and accurate information concerning eligibility, declaring treatments, and offered assistance.
Less than 100. If the employer had 100 or less workers usually in 2019, then the credit is based.
on incomes paid to all employees whether they actually worked or not. Simply put, even if the.
employees worked full time and made money for full time work, the employer still gets the credit.
Greater than 100. If the employer had more than 100 employees usually in 2019, then the credit is.
enabled just for earnings paid to employees who did not work during the calendar quarter.
In both cases, “earnings” consists of not simply money payments but also a part of the cost of company.
offered health care. How To Claim Employee Retention Credit Retroactively
Companies can be right away reimbursed for the credit by minimizing the amount of payroll taxes they.