Lets talk first about Irs Hurricane Harvey Employee Retention Credit :
Our team here what do these guys doing everybody in this space is helping teach individuals about ERC and uh constantly offer a gorgeous breakfast and have individuals truly learn more about the program we must head to the room where we are able to display some of the checks that we are getting for business and I want to see that what is this this is uh hundreds of 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 indicate this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I indicate it’s simply I imply consider how many actual clients that went through the program yeah this is the very end this is the party at the end when the check is validated the numbers are validated and the check is on the mail in the mail from the internal revenue service heading to the customer so that’s how you’re able to track it you understand when you
get this you know the check is chosen sure which’s when they pay so they do not pay anything until they really get the cash they don’t pay bottom line Wonder trust anything till this letter is verified the check is on the method they transfer it into their bank account and they can really rely on Wonder trust that the procedure has actually been completed and how many you believe you have actually processed considering that you started this we’re about 35 000 of these for
about six billion dollars wow so clearly they know what they’re doing and that’s what you need you require 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 talking about something truly essential today the employee retention credit which most of you have actually never ever heard of I certainly had not become aware of it till really just recently and found out a lot about it because this is most likely the most affordable cost of capital for any small business anywhere
anytime if you have workers between 5 and five hundred so I have actually got the professional with me this is Josh Fox he’s the creator and CEO of bottom line Ideas they’re the largest processor of these ERC credits this is a 170 page program so it’s difficult this isn’t like PPP we simply call up your bank supervisor 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 have actually ended up being yes the Ambassador and paid spokesperson for this I enjoy this program it’s disappearing soon you got to learn everything about it let’s talk employee retention credit Josh Fox what is an ERC let’s simply start there so throughout the Trump Administration when President Trump was enacted they developed the cares Act and the cares act offered companies 3 opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and almost everyone it makes a big difference right there 2 of them are loans and one’s a refund precisely so the ERC is a refund that’s.
fix the money money payroll tax refund fine go on sorry I simply have to make sure we got that point I mean that’s a huge difference a loan versus cash 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 original cares Act is the ERC and yes Kevin it is a beautiful difficult check in the mail where you get real cash from the IRS all right so let’s talk about how it works due to the fact that it sounds 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 Presumption this money is not for the owner not for individuals on the cap table not for investors it’s for workers right you had to have owned a business but it’s based upon you having W-2 employees in America not 10.99. As long as you had W-2 employees 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 appropriate so there were six quarters the program was open well stroll us through the six quarters so you had quarters two 3 and four of 2020 and you had quarters one 2 and three of 2021. fine so that’s how it’s measured you need to be on the W-2 throughout that period now let’s talk my preferred part cash just how much can you get back per employee that was on a W-2 in those six quarters so the estimation in 2020 to be precise Kevin is 50 of the staff member’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 income to an optimum of seven thousand per quarter how did that happen um they simply changed the rules in.
2021 versus since the turmoil 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 takes place 21 000 Max in 2021 oh that’s how you create twenty 6 thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty six thousand dollars per staff member that is because that’s a great deal of cash it is now there’s a caution here the PPP cash would have to be decreased from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan two you would minimize the 26 000 so what we’re seeing typically Kevin is if you took PPP money someplace 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 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 huge obviously now the big concern is why does no one know about this because appearance when I initially heard about this when I initially satisfied Josh you understand I’ve got lots of investments in great deals of business I’m a major advocate for entrepreneurship in America and make numerous lots of investments in business owners of which numerous suffered through the pandemic when I initially found out about this I called BS I do not believe it because I use 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 which were well been worthy of and we utilized them carefully 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 contacted us to my politician buddies Guv Senators they didn’t learn about it I imply that’s how you know that’s how false information is that there’s no info out there then a bunch 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 understand about the worker retention credit you know what’s fascinating you’re speaking about the banks Kevin since 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 procedure in Canada a pre-pp loan there’s no loans in Canada by the way it’s just procedure process that’s all um and here there was mayhem due to the fact that remember in the original cares act you could not do both programs so if you had actually done PPP you could refrain from doing 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 government never ever made it clear to anyone about how to.
do this does your CFO understand how to do this not actually he or she’s never ever 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 company your accountant no your accountant’s never ever done this before unless you have an account that entered into this business and bottom line my firm Kevin has actually stayed in business since 2009 and we have actually been working with the federal government and the state government to recuperate cash for Fortune 500 Fortune 1000 companies so a lot of our huge huge corporate clients have dealt with bottom line to recuperate other government programs we have actually 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 staff member retention tax credit is a broad based refundable tax credit designed to encourage.
employers to keep workers on their payroll. The credit is 50% of approximately $10,000 in incomes paid by an.
Due to the fact that of COVID-19 or whose gross invoices, employer whose organization is fully or partly suspended.
decrease by more than 50%.
1. The credit is offered to all companies no matter size including tax exempt companies. There are.
just two exceptions: (1) state and city governments and their instrumentalities and (2) little.
services who take Small company Loans.
2. To qualify, the company needs to fulfill one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the company’s organization is fully 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. Once the.
employer’s gross invoices exceed 80% of a comparable quarter in 2019 they no longer certify.
after the end of that quarter.
Estimation of the Credit.
The quantity of the credit is 50% of the qualifying earnings paid up to $10,000 in total.
It is effective for salaries paid after March 13th and prior to December 31, 2020.
The meaning of certifying earnings differs by whether a company had, usually, basically than.
100 staff members in 2019.
Companies that concentrate on ERC filing support generally offer competence and support to help companies navigate the complex procedure of claiming the credit. They can offer various services, including:.
How is the employee retention credit calculated? Irs Hurricane Harvey Employee Retention Credit
Eligibility Assessment: These companies will assess your organization’s eligibility for the ERC based upon factors such as your industry, revenue, and operations. They can help identify if you satisfy the requirements for the credit and determine the optimum credit quantity you can declare.
Paperwork and Computation: ERC filing services will assist in gathering the required documentation, such as payroll records and financial declarations, to support your claim. They will likewise assist calculate the credit amount based upon eligible wages and other qualifying costs.
Retroactive Claim Review: If you are qualified to declare the ERC for prior quarters, these business can review your past payroll records and financials to determine possible opportunities for retroactive credits. They can assist you modify prior tax returns to claim these refunds.
Filing Help: Companies focusing on ERC filings will prepare and send the necessary forms and documents on your behalf. This consists of completing Form 941 or any other required tax forms.
Compliance and Updates: ERC policies and assistance have evolved gradually. These companies stay updated with the current modifications and make sure that your filings comply with the most current standards. If the Internal revenue service demands extra details or performs an audit associated to your ERC claim, they can likewise provide continuous assistance.
It is essential to research study and vet any company offering ERC filing help to guarantee their credibility and knowledge. Search 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 assistance.
Remember that while these business can provide valuable support, it’s constantly an excellent concept to have a fundamental understanding of the ERC requirements and process yourself. This will help you make informed decisions and guarantee accurate filings.
The Employee Retention Credit (ERC) is a refundable tax credit presented by the U.S. government as part of COVID-19 relief steps. The goal of the ERC is to motivate organizations to maintain and pay their employees during the pandemic, even if their operations have actually been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is offered to eligible employers, including for-profit companies, tax-exempt companies, and particular governmental entities. To qualify, companies should satisfy one of two criteria:.
The business operations were totally or partially suspended due to a government order related to COVID-19.
Business experienced a significant decline in gross receipts. As pointed out previously, for 2021, a considerable decline is specified as a 20% decline in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a considerable 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 company’s share of Social Security taxes. The credit quantity amounts to a portion (approximately 70%) of qualified wages paid to workers, consisting of particular health insurance expenses. The optimum credit per employee is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, businesses that received an Income Security Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 allows organizations to declare the ERC even if they received a PPP loan. However, the same salaries can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively expanded and improved, allowing qualified companies to claim the credit for certified earnings paid as far back as March 13, 2020. This retroactive arrangement offers a chance for services to amend prior-year tax returns and receive refunds.
Declaring the Credit: Employers can claim the ERC by reporting it on their employment tax returns, normally Kind 941. The excess can be reimbursed to the employer if the credit surpasses the amount of employment taxes owed.
It’s important to keep in mind that the ERC arrangements and eligibility requirements have actually evolved in time. The best strategy is to talk to a tax professional or check out the main internal revenue service site for the most detailed and current info regarding the ERC, consisting of any current legislative changes or updates.
To receive the ERC, a company must fulfill among the following requirements:.
Business operations were totally or partly suspended due to a federal government order related to COVID-19.
Business experienced a significant decline in gross receipts. For 2021, a significant decline 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 instantly preceding quarter.
The ERC is offered to services of all sizes, including tax-exempt organizations, but 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 involves finishing the necessary types and including the credit on your employment income tax return (generally Type 941). The exact time it requires to process the credit can vary based upon several factors, consisting of the complexity of your service and the workload of the internal revenue service. It’s recommended to talk to a tax professional for guidance particular to your circumstance.
There are a number of 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 companies that offer assistance with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s advisable to research and contact these companies straight to ask about their services and fees.
Please keep in mind that the details supplied here is based on basic understanding and may not show the most current updates or modifications to the ERC. It’s important to seek advice from a tax professional or go to the main IRS site for the most updated and precise details regarding eligibility, declaring treatments, and readily available assistance.
Less than 100. The credit is based if the company had 100 or less employees on average in 2019.
on wages paid to all workers whether they in fact worked or not. To put it simply, even if the.
staff members worked full time and got paid for full-time work, the employer still gets the credit.
Greater than 100. If the company had more than 100 staff members typically in 2019, then the credit is.
enabled just for wages paid to workers who did not work throughout the calendar quarter.
In both cases, “salaries” includes not simply money payments but also a part of the cost of employer.
provided health care. Irs Hurricane Harvey Employee Retention Credit
Employers can be immediately reimbursed for the credit by decreasing the amount of payroll taxes they.