Lets talk first about How To Claim Employee Retention Credit :
Our team here what do these guys doing everybody in this room is assisting teach individuals about ERC and uh always offer a gorgeous breakfast and have people truly find out 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 want to see that what is this this is uh numerous countless dollars literally Kevin hundreds of countless dollars so these are duplicate copies of the letters that go to clients confirming that the check is on the way I imply you know if you just begin to take a look at a few of these here I suggest 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 about the number of 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 customer so that’s how you have the ability to track it you know when you
get this you know the check is opted for sure which’s when they pay so they don’t pay anything up until they actually get the money they don’t pay bottom line Wonder trust anything up until this letter is validated the check is on the method they transfer it into their checking account and they can really rely on Wonder trust that the procedure has actually been finished and the number of you believe you’ve processed given that you began 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 require professionals 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 Terrific here you’re at my YouTube channel we’re discussing something truly essential today the worker retention credit which most of you have never become aware of I definitely hadn’t become aware of it till extremely recently and learned a lot about it since this is most likely the lowest cost of capital for any small business anywhere
anytime if you have employees in between 5 and five hundred so I’ve got the specialist with me this is Josh Fox he’s the founder and CEO of bottom line Concepts 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 call your bank manager and state 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 ended up being yes the Ambassador and paid representative for this I like this program it’s disappearing soon you got to discover all about it let’s talk staff member retention credit Josh Fox what is an ERC let’s just begin there so throughout the Trump Administration when President Trump was enacted they developed the cares Act and the cares act provided organizations three 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.
remedy the money money payroll tax refund okay go on sorry I simply have to make sure we got that point I suggest that’s a huge distinction a loan versus cash money I like cash money 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 stunning difficult check in the mail where you get real money from the internal revenue service all right so let’s talk about how it works since 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 workers right you needed to have owned an organization but it’s based on you having W-2 workers 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 six months of 2021 on the W-2 correct so there were six 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 2 and three of 2021. all right so that’s how it’s determined you need to be on the W-2 throughout 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 6 quarters so the estimation in 2020 to be specific Kevin is 50 of the employee’s wage to an optimum of 5 thousand dollars per worker for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the employee’s income to a maximum of 7 thousand per quarter how did that take place um they just changed the rules in.
2021 versus since 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 as much as five thousand Max and then 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 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 caveat here the PPP money would have 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 typically Kevin is if you took PPP cash someplace around ten thousand dollars an individual so let’s state hypothetically you owned a restaurant 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 big concern is why does no one understand about this since look when I first became aware of this when I first satisfied Josh you know I’ve got great deals of financial investments in lots of companies I’m a major supporter for entrepreneurship in America and make many many 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 believe it because I use 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 and that were well should have and we utilized them carefully to stay alive 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 called to my politician buddies Governor Senators they didn’t learn about it I suggest that’s how you understand that’s how misinformation is that there’s no information out there then a lot of individuals told me well you can’t get it since you took the PPP also not real so let’s ask Josh why does nobody understand about the employee retention credit you understand what’s interesting you’re speaking about the banks Kevin since in the PPP loan procedure the federal government made it very 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 process process that’s all um and here there was chaos due to the fact that remember in the initial cares act you might refrain from doing both programs so if you had done PPP you might refrain from doing ERC in the original program and when they altered the law in 2021 the banks were not doing ERC due to the fact that it’s not alone so you’re getting a tax refund so the government never made it clear to anyone about how to.
do this does your CFO know how to do this not actually he or she’s never done it in the past do the banks do it nope the banks do not do it the payroll business yeah a few of them are doing it as a payroll company your accounting professional no your accountant’s never ever done this prior to unless you have an account that went into this organization and bottom line my company Kevin has stayed in business because 2009 and we’ve been dealing with the federal government and the state government to recover money for Fortune 500 Fortune 1000 companies so a lot of our big huge corporate customers have actually worked with bottom line to recuperate other government programs we’ve done sales tax and use tax unemployment tax work chance tax credits research and development tax credits unclaimed home real estate tax all of these other federal government programs.
The worker retention tax credit is a broad based refundable tax credit developed to encourage.
companies to keep workers on their payroll. The credit is 50% of as much as $10,000 in salaries paid by an.
employer whose business is totally or partly 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 two exceptions: (1) state and local governments and their instrumentalities and (2) little.
services who take Small Business Loans.
2. To certify, the employer needs to meet one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the employer’s organization is totally or partly suspended by federal government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross invoices are listed below 50% of the comparable quarter in 2019. When the.
company’s gross receipts exceed 80% of a comparable 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 certifying salaries paid up to $10,000 in total.
It works for incomes paid after March 13th and prior to December 31, 2020.
The meaning of certifying earnings varies by whether a company had, on average, more or less than.
100 workers in 2019.
Business that focus on ERC filing help typically provide expertise and assistance to assist services navigate the intricate process of declaring the credit. They can offer various services, including:.
How is the employee retention credit calculated? How To Claim Employee Retention Credit
Eligibility Evaluation: These companies will examine your business’s eligibility for the ERC based on elements such as your industry, revenue, and operations. If you meet the requirements for the credit and identify the optimum credit amount you can declare, they can assist identify.
Documentation and Estimation: ERC filing services will assist in collecting the necessary documentation, such as payroll records and financial statements, to support your claim. They will likewise assist compute the credit quantity based upon qualified wages and other certifying expenditures.
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 potential chances for retroactive credits. They can assist you modify prior tax returns to declare these refunds.
Filing Help: Companies specializing in ERC filings will prepare and submit the essential forms and documents in your place. This consists of completing Kind 941 or any other required tax forms.
Compliance and Updates: ERC regulations and assistance have evolved with time. These companies remain updated with the most recent changes and make sure that your filings comply with the most existing standards. They can also supply ongoing assistance if the IRS requests extra information or performs an audit related to your ERC claim.
It’s important to research study and vet any business using ERC filing support to ensure their reliability and knowledge. Look for established firms with experience in tax and payroll services, or think about reaching out to trusted accounting companies or tax professionals who use ERC filing assistance.
Remember that while these companies can supply important help, it’s constantly an excellent idea to have a basic understanding of the ERC requirements and process yourself. This will help you make notified decisions and ensure accurate filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit presented by the U.S. federal government as part of COVID-19 relief procedures. The objective of the ERC is to encourage businesses to keep and pay their workers during the pandemic, even if their operations have actually been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is available to eligible companies, including for-profit services, tax-exempt organizations, and certain governmental entities. To qualify, companies should meet one of two criteria:.
Business operations were totally or partially suspended due to a government order related to COVID-19.
Business experienced a substantial decrease in gross receipts. As mentioned 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 significant decrease is defined as a 20% decrease in gross receipts compared to the very same quarter in 2019, or a 20% decline in gross invoices compared to the instantly 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 percentage (approximately 70%) of qualified wages paid to staff members, including certain health plan costs. The maximum credit per employee 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 Security Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 enables organizations to claim the ERC even if they received a PPP loan. However, the very same salaries can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively expanded and boosted, permitting eligible employers to declare the credit for certified salaries paid as far back as March 13, 2020. This retroactive provision supplies an opportunity for organizations to modify prior-year tax returns and receive refunds.
Declaring the Credit: Employers can declare the ERC by reporting it on their employment tax returns, usually Form 941. The excess can be refunded to the company if the credit exceeds the quantity of employment taxes owed.
It is necessary to note that the ERC provisions and eligibility criteria have actually progressed over time. The very best course of action is to consult with a tax professional or visit the main internal revenue service site for the most up-to-date and comprehensive information relating to the ERC, consisting of any current legal changes or updates.
To receive the ERC, a business must meet one of the following requirements:.
Business operations were completely or partly suspended due to a government order related to COVID-19.
The business experienced a significant decline in gross invoices. For 2021, a considerable decline is defined as a 20% decline in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a significant decrease is specified as a 20% decrease in gross invoices compared to the very same quarter in 2019, or a 20% decline in gross receipts compared to the right away preceding quarter.
The ERC is offered to organizations of all sizes, consisting of tax-exempt companies, however there are some exceptions. Federal government entities and organizations that got a PPP loan might have restrictions on declaring the credit.
The procedure for claiming the ERC includes finishing the necessary types and including the credit on your employment tax return (normally Type 941). The exact time it requires to process the credit can differ based upon a number of factors, including the intricacy of your company and the work of the IRS. It’s advised to speak with a tax professional for assistance particular to your situation.
There are a number of companies that can assist with the process of claiming the ERC. These include accounting firms, tax advisory services, and payroll service providers. Some well-known companies that use help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s recommended to research and get in touch with these business directly to ask about their costs and services.
Please note that the information offered here is based upon general understanding and may not reflect the most recent updates or modifications to the ERC. It is very important to consult with a tax professional or go to the main IRS website for the most precise and up-to-date details relating to eligibility, claiming treatments, and available support.
Less than 100. If the employer had 100 or fewer workers on average in 2019, then the credit is based.
on incomes paid to all staff members whether they actually worked or not. Simply put, even if the.
workers worked full time and made money for full time work, the company still gets the credit.
Greater than 100. The credit is if the company had more than 100 employees on average in 2019.
enabled just for incomes paid to workers who did not work throughout the calendar quarter.
In both cases, “salaries” includes not just cash payments but also a portion of the cost of employer.
supplied healthcare. How To Claim Employee Retention Credit
Employers can be right away repaid for the credit by lowering the quantity of payroll taxes they.