Lets talk first about Is There A Employee Retention Credit :
Our team here what do these guys doing everyone in this space is assisting teach individuals about ERC and uh constantly supply a lovely breakfast and have individuals truly learn about the program we need to head to the room where we are able to show some of the checks that we are getting for companies and I want to see that what is this this is uh numerous millions of dollars literally Kevin hundreds of millions of dollars so these are replicate copies of the letters that go to clients validating that the check is on the method I indicate 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 suggest it’s just I mean think about how many actual clients 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 internal revenue service heading to the customer so that’s how you’re able to track it you understand when you
receive this you know the check is opted for sure which’s when they pay so they do not pay anything till they in fact receive the cash they don’t pay bottom line Wonder trust anything until this letter is confirmed the check is on the way they deposit it into their bank account and they can genuinely rely on Wonder trust that the process has been finished and how many you think you have actually processed given that you began 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 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 speaking about something truly essential today the worker retention credit which the majority of you have actually never heard of I certainly hadn’t become aware of it until extremely 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 five 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 hard this isn’t like PPP we simply phone 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 all of us about it and how to get it and why I’ve become yes the Ambassador and paid representative for this I love this program it’s going away soon you got to discover all about it let’s talk staff member retention credit Josh Fox what is an ERC let’s simply begin 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 practically everybody it makes a big difference right there two 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 alright go on sorry I simply have to make sure we got that point I mean that’s a big distinction a loan versus cash cash I like money cash that’s what we’re talking 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 tough check in the mail where you get real cash from the IRS 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 an employee so I’m going to make the Presumption 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 actually owned a company however it’s based upon you having W-2 staff members in America not 10.99. As long as you had W-2 workers 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 have to be on payroll for the first six months of 2021 on the W-2 right so there were six quarters the program was open well stroll us through the 6 quarters so you had quarters two 3 and 4 of 2020 and you had quarters one 2 and three of 2021. fine so that’s how it’s determined you need to be on the W-2 throughout that period now let’s talk my favorite part cash how much can you get back per staff member that was on a W-2 in those six quarters so the estimation in 2020 to be precise Kevin is 50 of the worker’s salary to a maximum of 5 thousand dollars per worker for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the worker’s wage to an optimum of 7 thousand per quarter how did that happen um they just changed the rules in.
2021 versus because 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 approximately five thousand Max and then what takes place 21 000 Max in 2021 oh that’s how you come up with twenty 6 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 lot of money it is now there’s a caution here the PPP money would have to be lowered 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 10 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 staff members and you took PPP money you would still get a million dollar in the mail from the internal revenue service so it’s substantial obviously now the huge concern is why does no one learn about this since look when I first became aware of this when I initially fulfilled Josh you understand I have actually got lots of investments in great deals of companies I’m a major supporter for entrepreneurship in America and make lots of numerous investments in business owners of which lots of suffered through the pandemic when I first found out 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 should have and we utilized them sensibly 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 politician pals Guv Senators they didn’t understand about it I suggest that’s how you understand that’s how misinformation is that there’s no details out there then a lot of people informed me well you can’t get it since you took the PPP also not true so let’s ask Josh why does nobody know about the employee retention credit you know what’s intriguing you’re discussing the banks Kevin due to the fact that in the PPP loan procedure the federal government made it very clear that if you wanted 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 just process process that’s all um and here there was mayhem because keep in mind in the initial cares act you could not do both programs so if you had actually done PPP you could refrain from doing ERC in the initial program and when they altered the law in 2021 the banks were not doing ERC because it’s not alone so you’re getting a tax refund so the government never ever made it clear to any person about how to.
do this does your CFO understand how to do this not truly he or she’s never ever done it in the past 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 accounting professional no your accountant’s never ever done this prior to unless you have an account that entered into this service and bottom line my company Kevin has stayed in business given that 2009 and we have actually been dealing with the federal government and the state federal government to recuperate money for Fortune 500 Fortune 1000 business so a lot of our big big business customers have actually dealt with bottom line to recuperate other federal 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 federal government programs.
The employee retention tax credit is a broad based refundable tax credit created to motivate.
companies to keep workers on their payroll. The credit is 50% of as much as $10,000 in earnings paid by an.
employer whose business is completely or partly suspended because of COVID-19 or whose gross receipts.
decrease by more than 50%.
Schedule.
1. The credit is offered to all companies regardless of size consisting of tax exempt organizations. There are.
only 2 exceptions: (1) state and city governments and their instrumentalities and (2) small.
organizations who take Small Business Loans.
2. To qualify, the company needs to satisfy one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the company’s organization is completely or partially suspended by federal government order due to COVID-19.
during the calendar quarter or.
o the employer’s gross receipts are listed below 50% of the comparable quarter in 2019. When the.
company’s gross receipts exceed 80% of a similar quarter in 2019 they no longer qualify.
after completion of that quarter.
Estimation of the Credit.
The amount of the credit is 50% of the certifying incomes paid up to $10,000 in overall.
It is effective for earnings paid after March 13th and before December 31, 2020.
The meaning of certifying incomes differs by whether an employer had, on average, basically than.
100 staff members in 2019.
Companies that focus on ERC filing help typically supply competence and support to assist companies browse the complex process of claiming the credit. They can provide various services, including:.
How is the employee retention credit calculated? Is There A Employee Retention Credit
Eligibility Evaluation: These business will evaluate your business’s eligibility for the ERC based on aspects such as your industry, earnings, and operations. If you meet the requirements for the credit and determine the maximum credit quantity you can claim, they can assist identify.
Documentation and Calculation: ERC filing services will help in gathering the necessary documents, such as payroll records and monetary statements, to support your claim. They will likewise assist determine the credit amount based on qualified earnings and other certifying costs.
Retroactive Claim Evaluation: If you are qualified to declare the ERC for previous quarters, these business can evaluate your previous payroll records and financials to determine potential opportunities for retroactive credits. They can help you modify prior tax returns to declare these refunds.
Filing Assistance: Business focusing on ERC filings will prepare and send the necessary types and paperwork on your behalf. This includes completing Kind 941 or any other necessary tax forms.
Compliance and Updates: ERC guidelines and assistance have progressed gradually. These companies stay updated with the most recent modifications and guarantee that your filings adhere to the most existing standards. If the Internal revenue service demands additional information or conducts an audit associated to your ERC claim, they can also provide continuous support.
It is necessary to research and veterinarian any business providing ERC filing support to ensure their reliability and know-how. Search for recognized firms with experience in tax and payroll services, or think about connecting to relied on accounting firms or tax specialists who use ERC submitting assistance.
Bear in mind that while these business can supply valuable support, it’s always an excellent idea to have a basic understanding of the ERC requirements and procedure yourself. This will help you make notified choices and make sure precise filings.
The Employee Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief procedures. The objective of the ERC is to encourage organizations to keep and pay their employees 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 eligible companies, consisting of for-profit organizations, tax-exempt organizations, and certain governmental entities. To certify, companies need to satisfy one of two requirements:.
The business operations were totally or partially suspended due to a government order related to COVID-19.
Business experienced a significant decline in gross invoices. As mentioned earlier, for 2021, a substantial decrease is defined as a 20% decrease in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a significant decline is defined as a 20% decrease in gross receipts compared to the exact same quarter in 2019, or a 20% decrease in gross receipts compared to the right away 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 portion (up to 70%) of certified earnings paid to staff members, including specific health insurance expenses. 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, services that received an Income Security Program (PPP) loan were not eligible for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 enables businesses to claim the ERC even if they received a PPP loan. The very same earnings can not be utilized to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively broadened and improved, allowing qualified companies to declare the credit for certified incomes paid as far back as March 13, 2020. This retroactive provision provides an opportunity for businesses to change prior-year tax returns and receive refunds.
Claiming the Credit: Employers can claim the ERC by reporting it on their employment tax returns, typically Form 941. The excess can be reimbursed to the employer if the credit surpasses the quantity of work taxes owed.
It is essential to keep in mind that the ERC arrangements and eligibility requirements have actually developed with time. The best course of action is to talk to a tax professional or go to the main IRS website for the most updated and comprehensive info relating to the ERC, consisting of any current legal modifications or updates.
To get approved for the ERC, a company needs to meet one of the following criteria:.
The business operations were fully or partially suspended due to a government order related to COVID-19.
Business experienced a substantial decline in gross receipts. For 2021, a considerable decline is specified as a 20% decline in gross invoices 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 exact same quarter in 2019, or a 20% decline in gross receipts compared to the immediately preceding quarter.
The ERC is readily available to businesses of all sizes, consisting of tax-exempt organizations, however there are some exceptions. Federal government entities and businesses that received a PPP loan might have restrictions on declaring the credit.
The procedure for claiming the ERC includes finishing the required forms and consisting of the credit on your work tax return (usually Type 941). The exact time it requires to process the credit can differ based upon several aspects, including 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 scenario.
There are a number of business that can help with the process of claiming the ERC. These consist of accounting companies, tax advisory services, and payroll company. Some popular business that provide assistance with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s recommended to research study and contact these companies directly to inquire about their services and costs.
Please keep in mind that the details offered here is based upon basic understanding and might not reflect the most current updates or changes to the ERC. It is essential to talk to a tax expert or check out the main internal revenue service website for the most current and precise info concerning eligibility, claiming procedures, and available help.
Less than 100. The credit is based if the employer had 100 or fewer workers on average in 2019.
on incomes paid to all staff members whether they really worked or not. Simply put, even if the.
workers worked full-time and made money for full time work, the employer still gets the credit.
Greater than 100. If the company had more than 100 staff members usually in 2019, then the credit is.
permitted only for wages paid to employees who did not work throughout the calendar quarter.
In both cases, “incomes” includes not simply cash payments but likewise a portion of the cost of employer.
offered healthcare. Is There A Employee Retention Credit
Payment.
Employers can be immediately repaid for the credit by lowering the quantity of payroll taxes they.