Lets talk first about Outstanding Employee Retention Credits :
Our group here what do these guys doing everyone in this room is helping teach people about ERC and uh constantly provide a beautiful breakfast and have individuals really find out about the program we must head to the room where we are able to show a few of the checks that we are getting for business and I ‘d like to see that what is this this is uh numerous countless dollars actually Kevin numerous countless dollars so these are replicate copies of the letters that go to customers validating that the check is on the way I imply you understand if you just start 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 suggest it’s simply I imply consider how many actual 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 verified and the check is on the mail in the mail from the internal revenue service heading to the consumer so that’s how you’re able to track it you know when you
get this you understand the check is opted for sure which’s when they pay so they don’t pay anything until they in fact get the money they do not pay bottom line Wonder trust anything till this letter is validated the check is on the method they deposit it into their savings account and they can really trust Wonder trust that the procedure has been ended up and the number of you think you have actually processed given that you started this we’re about 35 000 of these for
about 6 billion dollars wow so clearly they know what they’re doing and that’s what you require you require specialists on the other end of the phone to process this and get it to where you get one of these that’s what matters all right Mr Fantastic here you’re at my YouTube channel we’re speaking about something really important today the worker retention credit which most of you have never become aware of I certainly hadn’t heard of it until extremely just recently and discovered a lot about it because this is most likely the lowest cost of capital for any small business anywhere
anytime if you have employees between 5 and five hundred so I’ve got the expert with me this is Josh Fox he’s the creator and CEO of bottom line Concepts 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 just call your bank supervisor and say give 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’ve become yes the Ambassador and paid spokesperson for this I enjoy this program it’s going away soon you got to learn all 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 provided services three chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and almost everybody it makes a big distinction right there 2 of them are loans and one’s a refund exactly so the ERC is a refund that’s.
correct the money cash payroll tax refund okay go on sorry I just need to ensure 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 speaking about 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 initial cares Act is the ERC and yes Kevin it is a beautiful difficult check in the mail where you get actual cash from the IRS all right so let’s speak 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 individual needed to be a worker so I’m going to make the Presumption this cash is not for the owner not for people on the cap table not for shareholders it’s for staff members right you needed to have actually owned an organization however 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 eligible 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 proper so there were six quarters the program was open well stroll us through the 6 quarters so you had quarters 2 3 and 4 of 2020 and you had quarters one 2 and three of 2021. alright so that’s how it’s determined you have to be on the W-2 during that duration now let’s talk my favorite part cash just how much can you return per staff member that was on a W-2 in those 6 quarters so the computation in 2020 to be exact Kevin is 50 of the staff member’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 worker’s salary to a maximum of 7 thousand per quarter how did that occur um they just altered the rules in.
2021 versus due to the fact that 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 come up with twenty six thousand twenty one thousand to twenty twenty one plus five thousand in twenty twenty that’s twenty six thousand dollars per worker that is since that’s a great deal of money it is now there’s a caution here the PPP money would need 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 a person so let’s state hypothetically you owned a dining establishment 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 big clearly now the huge concern is why does no one understand about this since appearance when I initially found out about this when I initially met Josh you know I have actually got lots of financial investments in lots of business I’m a significant supporter for entrepreneurship in America and make many numerous financial investments in entrepreneurs of which numerous suffered through the pandemic when I initially heard about this I called BS I do not believe it since 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 deserved and we utilized them carefully to survive during the pandemic so when I became aware of this I said nah it can’t hold true however when I dug around I even called to my political leader friends Guv Senators they didn’t understand about it I mean that’s how you know that’s how false information is that there’s no details out there then a bunch of people told me well you can’t get it due to the fact that you took the PPP also not real so let’s ask Josh why does no one understand about the worker retention credit you know what’s fascinating you’re discussing the banks Kevin due to the fact that in the PPP loan process 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 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 process process that’s all um and here there was chaos due to the fact that remember in the original cares act you might not do both programs so if you had actually done PPP you might not do ERC in the initial program and when they altered 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 any person about how to.
do this does your CFO know how to do this not truly he or she’s never ever done it before 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 accountant no your accounting professional’s never ever done this before unless you have an account that went into this service 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 government to recover cash for Fortune 500 Fortune 1000 business so a lot of our huge big business customers have actually worked with bottom line to recuperate other government programs we have actually done sales tax and utilize tax joblessness tax work opportunity tax credits research and development tax credits unclaimed property property tax all of these other government programs.
The worker retention tax credit is a broad based refundable tax credit developed to encourage.
employers to keep employees on their payroll. The credit is 50% of approximately $10,000 in incomes paid by an.
company whose service is fully or partly suspended because of COVID-19 or whose gross receipts.
decrease by more than 50%.
1. The credit is readily available to all companies regardless of size including tax exempt companies. There are.
only two exceptions: (1) state and local governments and their instrumentalities and (2) small.
organizations who take Small company Loans.
2. To qualify, the company has to satisfy one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the company’s service is fully or partly suspended by federal government order due to COVID-19.
throughout the calendar quarter or.
o the employer’s gross receipts are below 50% of the similar quarter in 2019. When the.
employer’s gross invoices go above 80% of a comparable quarter in 2019 they no longer certify.
after completion of that quarter.
Estimation of the Credit.
The quantity of the credit is 50% of the certifying wages paid up to $10,000 in total.
It works for salaries paid after March 13th and before December 31, 2020.
The meaning of certifying wages differs by whether a company had, usually, more or less than.
100 staff members in 2019.
Companies that specialize in ERC filing assistance normally provide competence and support to help businesses browse the complex process of declaring the credit. They can provide numerous services, including:.
How is the employee retention credit calculated? Outstanding Employee Retention Credits
Eligibility Evaluation: These companies will examine your organization’s eligibility for the ERC based upon factors such as your market, revenue, and operations. If you satisfy the requirements for the credit and recognize the maximum credit quantity you can claim, they can assist determine.
Documents and Estimation: ERC filing services will assist in gathering the required documents, such as payroll records and financial statements, to support your claim. They will also help compute the credit amount based on eligible incomes and other qualifying expenditures.
Retroactive Claim Evaluation: If you are qualified to declare the ERC for previous quarters, these companies can review your past payroll records and financials to determine prospective chances for retroactive credits. They can help you amend prior income tax return to claim these refunds.
Filing Assistance: Business focusing on ERC filings will prepare and send the essential types and documentation in your place. This includes completing Form 941 or any other required tax forms.
Compliance and Updates: ERC guidelines and guidance have actually evolved in time. These companies stay updated with the latest changes and ensure that your filings adhere to the most current standards. If the IRS requests additional info or conducts an audit associated to your ERC claim, they can likewise provide continuous support.
It is essential to research and veterinarian any company providing ERC filing assistance to guarantee their trustworthiness and knowledge. Try to find established companies with experience in tax and payroll services, or think about reaching out to relied on accounting firms or tax specialists who provide ERC filing assistance.
Keep in mind that while these business can provide important assistance, it’s always a good concept to have a fundamental understanding of the ERC requirements and procedure yourself. This will help you make informed decisions and ensure precise filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief measures. The objective of the ERC is to motivate organizations to maintain and pay their employees during the pandemic, even if their operations have been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is offered to qualified companies, consisting of for-profit organizations, tax-exempt companies, and certain governmental entities. To certify, companies must fulfill one of two requirements:.
Business operations were totally or partly suspended due to a government order related to COVID-19.
The business experienced a considerable decline in gross invoices. As discussed previously, 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 considerable decrease is defined as a 20% decline in gross receipts compared to the same quarter in 2019, or a 20% decline in gross invoices compared to the immediately preceding quarter.
Credit Quantity: 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 (up to 70%) of qualified incomes paid to workers, consisting of particular health plan expenses. The optimum 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 got a Paycheck Protection Program (PPP) loan were not qualified for the ERC. However, legislation passed in late 2020 and extended in 2021 enables services to claim the ERC even if they received a PPP loan. However, the exact same wages can not be utilized to claim both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively expanded and improved, allowing eligible companies to declare the credit for certified earnings paid as far back as March 13, 2020. This retroactive provision offers an opportunity for organizations to amend prior-year income tax return and receive refunds.
Claiming the Credit: Employers can claim the ERC by reporting it on their work income tax return, normally Kind 941. The excess can be refunded to the company if the credit goes beyond the amount of work taxes owed.
It is essential to note that the ERC provisions and eligibility criteria have actually progressed gradually. The best course of action is to consult with a tax professional or check out the main IRS website for the most updated and in-depth information relating to the ERC, consisting of any recent legal changes or updates.
To get approved for the ERC, a company needs to fulfill one of the following criteria:.
The 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 significant 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% decline in gross receipts compared to the exact same quarter in 2019, or a 20% decline in gross receipts compared to the right away preceding quarter.
The ERC is available to organizations of all sizes, consisting of tax-exempt organizations, however there are some exceptions. Government entities and businesses that received a PPP loan might have restrictions on claiming the credit.
The process for declaring the ERC involves completing the required forms and including the credit on your work income tax return (typically Form 941). The exact time it takes to process the credit can differ based on a number of aspects, including the complexity of your organization and the workload of the internal revenue service. It’s recommended to talk to a tax professional for guidance specific to your circumstance.
There are several companies that can assist with the process of declaring the ERC. Some well-known business that provide assistance with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the details offered here is based upon general understanding and might not reflect the most recent updates or changes to the ERC. It is very important to speak with a tax expert or go to the official internal revenue service website for the most precise and current details regarding eligibility, declaring treatments, and readily available assistance.
Less than 100. If the company had 100 or less workers usually in 2019, then the credit is based.
on salaries paid to all staff members whether they actually worked or not. In other words, even if the.
staff members worked full time and got paid for full-time work, the company still gets the credit.
Greater than 100. If the company had more than 100 staff members usually in 2019, then the credit is.
permitted just for wages paid to workers who did not work during the calendar quarter.
In both cases, “incomes” includes not just cash payments but also a part of the expense of company.
offered health care. Outstanding Employee Retention Credits
Companies can be instantly reimbursed for the credit by reducing the quantity of payroll taxes they.