Lets talk first about New Law Clarifies And Expands Cares Act Employee Retention Credit :
Our team here what do these people doing everybody in this room is helping teach individuals about ERC and uh constantly offer a beautiful breakfast and have individuals really learn more about the program we should head to the room where we are able to show some of the checks that we are getting for business and I want to see that what is this this is uh numerous countless dollars literally Kevin hundreds of countless dollars so these are replicate copies of the letters that go to clients confirming that the check is on the method 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 imply consider the number of real clients 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 IRS heading to the client so that’s how you’re able to track it you know when you
get this you know the check is opted for sure and that’s when they pay so they don’t pay anything till they actually receive the cash they don’t pay bottom line Wonder trust anything up until this letter is confirmed the check is on the way they deposit it into their checking account and they can truly rely on Wonder trust that the procedure has been ended up and the number of you think you have actually processed because you started this we’re about 35 000 of these for
about 6 billion dollars wow so plainly they understand what they’re doing which’s what you need 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 Wonderful here you’re at my YouTube channel we’re discussing something actually essential today the employee retention credit which most of you have never ever become aware of I definitely hadn’t become aware of it up until very just recently and learned a lot about it due to the fact that this is most likely the lowest cost of capital for any small company anywhere
anytime if you have staff members in between 5 and five hundred so I have actually got the specialist with me this is Josh Fox he’s the creator and CEO of bottom line Concepts they’re the largest processor of these ERC credits this is a 170 page program so it’s challenging this isn’t like PPP we just phone your bank supervisor and state give me a loan it does not 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 have actually ended up being yes the Ambassador and paid representative for this I like this program it’s disappearing very soon you got to discover everything about it let’s talk staff member retention credit Josh Fox what is an ERC let’s simply start there so during the Trump Administration when President Trump was enacted they created the cares Act and the cares act used businesses three opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and almost everyone it makes a huge difference right there 2 of them are loans and one’s a refund exactly so the ERC is a refund that’s.
correct the cash cash payroll tax refund okay go on sorry I simply need to ensure we got that point I suggest that’s a huge distinction a loan versus cash cash I like money cash that’s what we’re talking about all right 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 gorgeous tough check in the mail where you get actual cash from the internal revenue service all right so let’s discuss how it works because it seems like to me if it’s a if it’s worker retention credit that person needed to be an employee so I’m going to make the Assumption this cash is not for the owner not for people on the cap table not for shareholders it’s for employees right you had to have owned an organization however 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 qualified so you need to be on payroll in 2020 on the W-2 and you need 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 walk us through the six quarters so you had quarters two three and four of 2020 and you had quarters one 2 and 3 of 2021. okay so that’s how it’s measured you need to be on the W-2 during that period now let’s talk my preferred part cash just how much can you get back per staff member that was on a W-2 in those six quarters so the calculation in 2020 to be exact Kevin is 50 of the worker’s income to a maximum of five thousand dollars per worker for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the staff member’s wage to a maximum of 7 thousand per quarter how did that happen um they just changed the rules in.
2021 versus because the turmoil 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 up to five thousand Max and after that what takes place 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 worker that is since that’s a lot of money it is now there’s a caution here the PPP money would need to be lowered from the twenty six thousand dollars so if you took PPP loan one and PPP loan two you would lower the 26 000 so what we’re seeing on average Kevin is if you took PPP money someplace around ten thousand dollars an individual so let’s state hypothetically you owned a restaurant 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 internal revenue service so it’s substantial certainly now the huge concern is why does no one learn about this since appearance when I first heard about this when I first met Josh you know I’ve got lots of investments in lots of business I’m a major supporter for entrepreneurship in America and make numerous many 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 think 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 deserved and we used them carefully to stay alive during the pandemic so when I found out about this I stated nah it can’t be true however when I dug around I even called to my political leader good friends Guv Senators they didn’t know about it I suggest that’s how you understand that’s how false information is that there’s no info out there then a lot of individuals informed me well you can’t get it because you took the PPP also not true so let’s ask Josh why does no one learn about the employee retention credit you understand what’s fascinating you’re discussing the banks Kevin because in the PPP loan procedure the federal government made it really 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 just procedure procedure that’s all um and here there was mayhem because remember in the original cares act you might refrain from doing both programs so if you had actually done PPP you might refrain from doing ERC in the original program and when they changed the law in 2021 the banks were refraining from doing ERC since 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 understand how to do this not truly she or he’s never ever done it previously do the banks do it nope the banks do not do it the payroll business 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 because 2009 and we’ve been dealing with the federal government and the state federal government to recuperate money for Fortune 500 Fortune 1000 companies so a great deal of our huge big business clients have worked with bottom line to recover other federal government programs we have actually done sales tax and utilize tax joblessness tax work opportunity tax credits research and development tax credits unclaimed property real estate tax all of these other government programs.
The worker retention tax credit is a broad based refundable tax credit developed to motivate.
companies to keep staff members on their payroll. The credit is 50% of as much as $10,000 in salaries paid by an.
Because of COVID-19 or whose gross receipts, company whose service is completely or partly suspended.
decrease by more than 50%.
1. The credit is offered to all employers despite size consisting of tax exempt organizations. There are.
only 2 exceptions: (1) state and city governments and their instrumentalities and (2) small.
businesses who take Small Business Loans.
2. To qualify, the company has to fulfill one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the employer’s business is totally or partially suspended by 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. As soon as the.
company’s gross receipts go above 80% of a comparable 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 overall.
It is effective for wages paid after March 13th and before December 31, 2020.
The definition of qualifying wages varies by whether a company had, on average, basically than.
100 workers in 2019.
Companies that concentrate on ERC filing help usually supply know-how and support to assist organizations navigate the complex procedure of claiming the credit. They can provide numerous services, including:.
How is the employee retention credit calculated? New Law Clarifies And Expands Cares Act Employee Retention Credit
Eligibility Assessment: These companies will assess your business’s eligibility for the ERC based upon elements such as your market, revenue, and operations. If you fulfill the requirements for the credit and determine the maximum credit amount you can declare, they can assist determine.
Documentation and Calculation: ERC filing services will assist in collecting the needed documents, such as payroll records and monetary statements, to support your claim. They will likewise help determine the credit amount based on qualified incomes and other certifying expenditures.
Retroactive Claim Evaluation: If you are eligible to claim the ERC for prior quarters, these companies can review your previous payroll records and financials to determine possible chances for retroactive credits. They can assist you change previous income tax return to claim these refunds.
Filing Support: Business concentrating on ERC filings will prepare and send the necessary kinds and documents on your behalf. This includes finishing Form 941 or any other required tax return.
Compliance and Updates: ERC regulations and guidance have evolved over time. These business stay updated with the most recent modifications and make sure that your filings comply with the most existing standards. They can likewise provide ongoing assistance if the internal revenue service requests additional details or conducts an audit related to your ERC claim.
It’s important to research and veterinarian any business providing ERC filing support to guarantee their credibility and proficiency. Try to find recognized companies with experience in tax and payroll services, or consider reaching out to relied on accounting firms or tax professionals who use ERC submitting assistance.
Bear in mind that while these companies can offer important assistance, it’s always a good idea to have a basic understanding of the ERC requirements and process yourself. This will assist you make informed choices and make sure precise filings.
The Employee Retention Credit (ERC) is a refundable tax credit introduced by the U.S. federal government as part of COVID-19 relief measures. The objective of the ERC is to encourage organizations to maintain and pay their staff members during the pandemic, even if their operations have been impacted.
Here are some key points about the ERC:.
Eligibility: The ERC is offered to qualified companies, consisting of for-profit companies, tax-exempt companies, and particular governmental entities. To certify, companies should fulfill one of two criteria:.
The business operations were totally or partially suspended due to a federal government order related to COVID-19.
The business experienced a significant decrease in gross receipts. As pointed out earlier, for 2021, a substantial decline is defined as a 20% decrease in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a substantial decrease is specified as a 20% decrease in gross receipts compared to the very same quarter in 2019, or a 20% decrease in gross receipts compared to the right away preceding quarter.
Credit Amount: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit quantity is equal to a percentage (as much as 70%) of qualified wages paid to workers, including particular health plan costs. 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, companies that got an Income Defense Program (PPP) loan were not eligible for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 permits services to claim the ERC even if they got a PPP loan. However, the same earnings can not be utilized to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively broadened and enhanced, permitting eligible employers to claim the credit for qualified earnings paid as far back as March 13, 2020. This retroactive arrangement supplies a chance for companies to amend prior-year tax returns and get refunds.
Declaring the Credit: Companies can declare the ERC by reporting it on their employment tax returns, usually Kind 941. The excess can be refunded to the company if the credit goes beyond the quantity of employment taxes owed.
It is very important to keep in mind that the ERC arrangements and eligibility criteria have actually developed in time. The best strategy is to seek advice from a tax professional or go to the main IRS website for the most current and comprehensive details relating to the ERC, consisting of any current legislative modifications or updates.
To get approved for the ERC, a service must meet among the following criteria:.
Business operations were completely or partially suspended due to a government order related to COVID-19.
Business experienced a considerable decrease in gross invoices. For 2021, a substantial decrease is defined as a 20% decrease in gross invoices compared to the 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 instantly preceding quarter.
The ERC is offered to companies of all sizes, consisting of tax-exempt organizations, but there are some exceptions. For example, federal government entities and services that got a PPP loan may have constraints on claiming the credit.
The procedure for declaring the ERC involves finishing the needed types and including the credit on your employment income tax return (usually Form 941). The exact time it takes to process the credit can vary based upon numerous aspects, including the complexity of your business and the work of the IRS. It’s recommended to talk to a tax expert for assistance specific to your situation.
There are numerous companies that can help with the procedure of declaring the ERC. These consist of accounting companies, tax advisory services, and payroll service providers. Some popular business that use assistance with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s recommended to research and contact these companies directly to ask about their services and fees.
Please keep in mind that the info offered here is based on general knowledge and might not reflect the most recent updates or changes to the ERC. It is necessary to talk to a tax professional or check out the official IRS website for the most updated and precise information relating to eligibility, declaring treatments, and offered support.
Less than 100. If the company had 100 or fewer workers on average in 2019, then the credit is based.
on earnings paid to all employees whether they actually worked or not. To put it simply, even if the.
staff members 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 typically in 2019, then the credit is.
permitted just for wages paid to staff members who did not work throughout the calendar quarter.
In both cases, “earnings” consists of not just money payments but likewise a part of the cost of employer.
offered health care. New Law Clarifies And Expands Cares Act Employee Retention Credit
Employers can be right away reimbursed for the credit by decreasing the amount of payroll taxes they.