Lets talk first about Irs Auditing Employee Retention Credit :
Our group here what do these men doing everybody in this room is helping teach individuals about ERC and uh always provide a stunning breakfast and have people really discover the program we ought to head to the room where we are able to display 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 hundreds of millions of dollars so these are replicate copies of the letters that go to customers confirming that the check is on the way I imply you understand if you just start to 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 imply it’s simply I indicate think of the number of 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 validated 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
receive this you understand the check is gone for sure which’s when they pay so they do not pay anything till they really receive the money they don’t pay bottom line Wonder trust anything till this letter is validated the check is on the method they transfer it into their bank account and they can really trust Wonder trust that the procedure has been finished and the number of you believe you’ve processed because you started this we’re about 35 000 of these for
about 6 billion dollars wow so clearly they understand 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 Terrific here you’re at my YouTube channel we’re talking about something truly crucial today the staff member retention credit which the majority of you have never heard of I definitely hadn’t heard of it up until very just recently and learned a lot about it since this is probably the lowest cost of capital for any small company anywhere
anytime if you have staff members in between five and five hundred so I’ve got the expert 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 challenging this isn’t like PPP we simply contact your bank supervisor 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 us all about it and how to get it and why I have actually ended up being yes the Ambassador and paid representative for this I like this program it’s going away soon you got to find out all 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 developed the cares Act and the cares act used businesses 3 chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and almost everyone it makes a big distinction right there 2 of them are loans and one’s a refund precisely so the ERC is a refund that’s.
correct the cash money payroll tax refund all right go on sorry I simply have to make sure we got that point I suggest that’s a big difference a loan versus money money I like money cash that’s what we’re speaking about 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 original cares Act is the ERC and yes Kevin it is a lovely hard check in the mail where you get real money from the internal revenue service all right so let’s discuss how it works because it sounds like to me if it’s a if it’s employee retention credit that individual had to be a worker so I’m going to make the Presumption 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 a business but it’s based on you having W-2 staff members 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 eligible so you have 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 right so there were six 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 3 of 2021. all right so that’s how it’s measured you need to be on the W-2 throughout that duration now let’s talk my preferred part cash just how much can you return per employee that was on a W-2 in those 6 quarters so the computation in 2020 to be precise Kevin is 50 of the employee’s income to an optimum of 5 thousand dollars per staff member for the year of 2020 and in 2021 the numbers escalated to 70 of the worker’s salary to a maximum of seven thousand per quarter how did that take place um they simply changed 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 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 create twenty six thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty 6 thousand dollars per worker that is since that’s a great deal of cash it is now there’s a caveat here the PPP cash would need 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 usually Kevin is if you took PPP money somewhere 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 IRS so it’s big undoubtedly now the big question is why does nobody understand about this due to the fact that appearance when I first found out about this when I first satisfied Josh you know I’ve got lots of financial investments in great deals of companies I’m a major supporter for entrepreneurship in America and make many many financial investments in business owners of which lots of suffered through the pandemic when I initially became aware of this I called BS I don’t believe it due to the fact that I utilize the PPP we went through the cash center Banks to get it it was really easy to do we had our CEOs call the banks they got their loans and that were well been worthy of and we used them wisely to stay alive during the pandemic so when I heard about this I said nah it can’t hold true however when I dug around I even called to my political leader good friends Guv Senators they didn’t learn about it I imply that’s how you understand that’s how false information is that there’s no information out there then a bunch of individuals told me well you can’t get it because you took the PPP also not true so let’s ask Josh why does nobody understand about the staff member retention credit you understand what’s interesting you’re speaking about the banks Kevin because 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 big banks in our nation and they would process process 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 because remember in the initial cares act you could not do both programs so if you had done PPP you might not do ERC in the initial program and when they changed 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 anybody about how to.
do this does your CFO understand 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 companies yeah some of them are doing it as a payroll business your accountant no your accountant’s never ever done this before unless you have an account that went into this service and bottom line my company Kevin has actually been in business considering that 2009 and we have actually been dealing with the federal government and the state government to recover cash for Fortune 500 Fortune 1000 business so a great deal of our big big business customers have dealt with bottom line to recuperate other government programs we have actually done sales tax and utilize 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.
employers to keep workers on their payroll. The credit is 50% of approximately $10,000 in wages paid by an.
company whose company is fully or partially suspended because of COVID-19 or whose gross invoices.
decrease by more than 50%.
1. The credit is readily available to all employers regardless of size including tax exempt organizations. There are.
only 2 exceptions: (1) state and local governments and their instrumentalities and (2) little.
businesses 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 company’s organization is completely or partly suspended by federal government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross receipts are listed below 50% of the similar quarter in 2019. As soon as the.
company’s gross receipts 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 certifying incomes paid up to $10,000 in total.
It is effective for earnings paid after March 13th and prior to December 31, 2020.
The definition of qualifying salaries varies by whether a company had, usually, more or less than.
100 workers in 2019.
Companies that specialize in ERC filing assistance generally supply competence and support to help organizations navigate the complex procedure of claiming the credit. They can offer numerous services, including:.
How is the employee retention credit calculated? Irs Auditing Employee Retention Credit
Eligibility Assessment: These business will examine your service’s eligibility for the ERC based on elements such as your market, earnings, and operations. If you meet the requirements for the credit and recognize the optimum credit quantity you can declare, they can help identify.
Documents and Computation: ERC filing services will assist in collecting the needed paperwork, such as payroll records and monetary declarations, to support your claim. They will also help compute the credit quantity based upon eligible salaries and other qualifying expenses.
Retroactive Claim Review: If you are qualified to claim the ERC for previous quarters, these business can review your previous payroll records and financials to recognize potential chances for retroactive credits. They can assist you modify previous income tax return to claim these refunds.
Filing Support: Companies concentrating on ERC filings will prepare and send the required kinds and documentation in your place. This includes completing Form 941 or any other necessary tax forms.
Compliance and Updates: ERC policies and assistance have actually developed in time. These business remain upgraded with the most recent changes and guarantee that your filings abide by the most current standards. If the IRS demands additional details or conducts an audit associated to your ERC claim, they can also offer ongoing assistance.
It is necessary to research and vet any business using ERC filing help to guarantee their trustworthiness and know-how. Search for recognized firms with experience in tax and payroll services, or think about reaching out to relied on accounting firms or tax experts who offer ERC submitting assistance.
Keep in mind that while these business can offer important support, it’s always a good concept to have a fundamental understanding of the ERC requirements and procedure yourself. This will help you make informed choices and make sure precise filings.
The Worker Retention Credit (ERC) is a refundable tax credit presented by the U.S. government as part of COVID-19 relief procedures. The objective of the ERC is to encourage organizations to maintain and pay their workers throughout the pandemic, even if their operations have actually been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is readily available to qualified companies, including for-profit organizations, tax-exempt companies, and certain governmental entities. To certify, employers should meet one of two requirements:.
The business operations were fully or partially suspended due to a federal government order related to COVID-19.
Business experienced a significant decrease in gross receipts. As discussed previously, for 2021, a significant 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 specified as a 20% decline in gross receipts compared to the very same quarter in 2019, or a 20% decrease in gross receipts compared to the instantly preceding quarter.
Credit Amount: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit quantity amounts to a portion (up to 70%) of certified salaries paid to workers, including particular health plan costs. The optimum 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 an Income Security Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 allows companies to claim the ERC even if they got a PPP loan. However, the very same earnings can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively expanded and enhanced, permitting eligible employers to claim the credit for qualified incomes paid as far back as March 13, 2020. This retroactive arrangement supplies a chance for businesses to change prior-year income tax return and get refunds.
Declaring the Credit: Companies can claim the ERC by reporting it on their work income tax return, typically Form 941. The excess can be refunded to the company if the credit exceeds the amount of work taxes owed.
It’s important to keep in mind that the ERC provisions and eligibility requirements have actually developed gradually. The best course of action is to speak with a tax professional or visit the official IRS site for the most in-depth and current information relating to the ERC, consisting of any current legislative changes or updates.
To qualify for the ERC, an organization needs to satisfy among the following requirements:.
The business operations were totally or partly suspended due to a government order related to COVID-19.
Business experienced a substantial decrease in gross receipts. For 2021, a substantial decline is specified as a 20% decrease 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 invoices compared to the same quarter in 2019, or a 20% decline in gross invoices compared to the immediately preceding quarter.
The ERC is readily available to organizations of all sizes, consisting of tax-exempt companies, but there are some exceptions. Government entities and organizations that got a PPP loan might have limitations on claiming the credit.
The procedure for claiming the ERC includes completing the essential forms and consisting of the credit on your employment income tax return (usually Kind 941). The exact time it requires to process the credit can vary based on several aspects, including the complexity of your company and the workload of the IRS. It’s recommended to talk to a tax expert for assistance particular to your circumstance.
There are numerous companies that can help with the procedure of claiming the ERC. These consist of accounting companies, tax advisory services, and payroll service providers. Some widely known business that provide assistance with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s advisable to research and contact these business directly to ask about their services and costs.
Please note that the details provided here is based upon basic understanding and might not reflect the most recent updates or changes to the ERC. It is essential to seek advice from a tax professional or check out the main IRS site for the most current and accurate info relating to eligibility, claiming procedures, and readily available help.
Less than 100. The credit is based if the company had 100 or less employees on average in 2019.
on wages paid to all employees whether they actually worked or not. In other words, even if the.
staff members worked full time and earned money for full-time work, the employer still gets the credit.
Greater than 100. If the employer had more than 100 employees on average in 2019, then the credit is.
enabled just for incomes paid to staff members who did not work during the calendar quarter.
In both cases, “incomes” includes not just cash payments however also a part of the cost of employer.
supplied healthcare. Irs Auditing Employee Retention Credit
Employers can be immediately repaid for the credit by minimizing the quantity of payroll taxes they.