Lets talk first about Partially Suspended Employee Retention Credit :
Our team here what do these men doing everybody in this space is helping teach individuals about ERC and uh constantly provide a stunning breakfast and have individuals really learn about the program we ought to head to the space 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 replicate copies of the letters that go to customers validating that the check is on the way I suggest you know if you simply start to take a look at a few of these here I imply this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I suggest it’s simply I suggest consider how many real 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 validated and the check is on the mail in the mail from the internal revenue service heading to the client 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 cash they don’t pay bottom line Wonder trust anything until this letter is confirmed the check is on the method they deposit it into their bank account and they can genuinely trust Wonder trust that the process has been finished and how many you believe you have actually processed given that 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 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 discussing something really important today the employee retention credit which the majority of you have never become aware of I definitely had not heard of it until really just recently and found out 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 5 and five hundred so I have actually got the professional with me this is Josh Fox he’s the founder and CEO of bottom line Ideas 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 simply contact your bank manager 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 all of us about it and how to get it and why I have actually become yes the Ambassador and paid representative for this I love this program it’s going away very soon you got to find out all about it let’s talk staff member retention credit Josh Fox what is an ERC let’s just start there so throughout the Trump Administration when President Trump was enacted they came up with the cares Act and the cares act provided companies 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 difference right there two 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 simply need to make sure we got that point I suggest that’s a huge distinction a loan versus cash cash I like cash 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 initial cares Act is the ERC and yes Kevin it is a gorgeous difficult check in the mail where you get actual cash from the IRS all right so let’s speak about how it works because 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 Assumption this money is not for the owner not for individuals on the cap table not for investors it’s for employees right you had to have actually owned an organization however it’s based upon you having W-2 workers 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 need 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 walk us through the six quarters so you had quarters 2 3 and four of 2020 and you had quarters one 2 and 3 of 2021. alright 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 return per worker that was on a W-2 in those 6 quarters so the estimation in 2020 to be precise Kevin is 50 of the worker’s income to a maximum of 5 thousand dollars per worker for the year of 2020 and in 2021 the numbers escalated to 70 of the employee’s wage to an optimum of seven thousand per quarter how did that happen um they just altered the rules in.
2021 versus because the chaos 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 as much as five thousand Max and after that 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 since that’s a lot of cash it is now there’s a caveat here the PPP cash would need to be reduced from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan two you would lower the 26 000 so what we’re seeing typically Kevin is if you took PPP money somewhere around 10 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 employees and you took PPP money you would still get a million dollar in the mail from the internal revenue service so it’s huge clearly now the big concern is why does nobody learn about this because look when I initially became aware of this when I initially met Josh you understand I have actually got great deals of investments in great deals of companies I’m a significant supporter for entrepreneurship in America and make many many financial investments in entrepreneurs of which many suffered through the pandemic when I first found out 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 which were well deserved and we utilized them carefully to stay alive during the pandemic so when I found out about this I said nah it can’t hold true but when I dug around I even contacted us to my politician good friends Guv Senators they didn’t know about it I indicate that’s how you understand that’s how false information is that there’s no information out there then a bunch of people informed me well you can’t get it because you took the PPP also not real so let’s ask Josh why does nobody learn about the employee retention credit you understand what’s interesting you’re talking about the banks Kevin due to the fact that 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 big banks in our country and they would process process 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 chaos because remember in the initial cares act you could not do both programs so if you had 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 anybody about how to.
do this does your CFO understand how to do this not actually he or she’s never done it in the past do the banks do it nope the banks do not do it the payroll companies yeah a few of them are doing it as a payroll company your accounting professional no your accounting professional’s never ever done this prior to unless you have an account that entered into this company and bottom line my firm Kevin has been in business because 2009 and we’ve been dealing with the federal government and the state government to recuperate money for Fortune 500 Fortune 1000 business so a great deal of our huge huge business clients have actually worked with bottom line to recover other federal government programs we’ve done sales tax and use tax unemployment tax work opportunity tax credits research and development tax credits unclaimed home property tax all of these other federal government programs.
The worker retention tax credit is a broad based refundable tax credit designed to motivate.
employers to keep workers on their payroll. The credit is 50% of as much as $10,000 in salaries paid by an.
Since of COVID-19 or whose gross receipts, employer whose business is fully or partly suspended.
decrease by more than 50%.
Availability.
1. The credit is offered to all employers no matter size consisting of tax exempt organizations. There are.
only two exceptions: (1) state and city governments and their instrumentalities and (2) little.
companies who take Small company Loans.
2. To qualify, the company needs to satisfy one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the company’s organization is fully or partially suspended by federal government order due to COVID-19.
throughout the calendar quarter or.
o the employer’s gross invoices are listed below 50% of the similar quarter in 2019. Once the.
employer’s gross invoices exceed 80% of an equivalent 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 earnings paid up to $10,000 in overall.
It works for earnings paid after March 13th and prior to December 31, 2020.
The definition of qualifying salaries differs by whether an employer had, typically, basically than.
100 workers in 2019.
Companies that focus on ERC filing support generally provide competence and support to help organizations browse the intricate procedure of declaring the credit. They can offer different services, including:.
How is the employee retention credit calculated? Partially Suspended Employee Retention Credit
Eligibility Assessment: These companies will assess your business’s eligibility for the ERC based on factors such as your market, profits, and operations. They can help identify if you fulfill the requirements for the credit and determine the optimum credit amount you can declare.
Documents and Calculation: ERC filing services will help in collecting the essential paperwork, such as payroll records and monetary statements, to support your claim. They will also assist determine the credit quantity based upon eligible incomes and other certifying expenses.
Retroactive Claim Review: If you are qualified to declare the ERC for previous quarters, these business can evaluate your previous payroll records and financials to identify possible chances for retroactive credits. They can help you amend prior tax returns to claim these refunds.
Filing Help: Companies specializing in ERC filings will prepare and send the required types and documents in your place. This consists of finishing Form 941 or any other necessary tax return.
Compliance and Updates: ERC guidelines and assistance have progressed over time. These companies remain upgraded with the most recent changes and guarantee that your filings adhere to the most existing guidelines. If the IRS demands additional information or conducts an audit associated to your ERC claim, they can likewise offer ongoing assistance.
It is necessary to research study and veterinarian any company using ERC filing help to guarantee their reliability and know-how. Look for established companies with experience in tax and payroll services, or consider connecting to trusted accounting firms or tax specialists who provide ERC submitting support.
Bear in mind that while these business can offer valuable help, it’s constantly an excellent idea to have a basic understanding of the ERC requirements and procedure yourself. This will help you make notified choices and ensure 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 goal of the ERC is to encourage services to keep and pay their workers during the pandemic, even if their operations have been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is offered to eligible employers, consisting of for-profit businesses, tax-exempt companies, and specific governmental entities. To qualify, companies need to meet one of two requirements:.
Business operations were totally or partly suspended due to a government order related to COVID-19.
The business experienced a substantial decrease in gross invoices. As pointed out earlier, for 2021, a significant decline is defined as a 20% decline in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a significant decrease is specified as a 20% decline in gross invoices compared to the exact same quarter in 2019, or a 20% decline in gross invoices 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 is equal to a percentage (approximately 70%) of qualified wages paid to workers, consisting of specific health insurance expenditures. The maximum credit per worker is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: At first, companies that received an Income Defense Program (PPP) loan were not eligible for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 allows organizations to claim the ERC even if they received a PPP loan. The same earnings can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively expanded and boosted, allowing qualified employers to claim the credit for certified wages paid as far back as March 13, 2020. This retroactive arrangement provides a chance for services to change prior-year income tax return and receive refunds.
Declaring the Credit: Companies can declare the ERC by reporting it on their work tax returns, typically Kind 941. If the credit goes beyond the quantity of work taxes owed, the excess can be refunded to the employer.
It is essential to note that the ERC provisions and eligibility criteria have actually progressed with time. The best strategy is to speak with a tax professional or check out the main internal revenue service site for the most up-to-date and in-depth details relating to the ERC, consisting of any recent legal changes or updates.
To receive the ERC, a business should satisfy among the following requirements:.
The business operations were completely or partly suspended due to a federal government order related to COVID-19.
Business experienced a substantial decline in gross receipts. For 2021, a substantial decline is defined as a 20% decline in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a significant decrease is specified as a 20% decline in gross invoices compared to the same quarter in 2019, or a 20% decline in gross invoices compared to the instantly preceding quarter.
The ERC is readily available to businesses of all sizes, consisting of tax-exempt companies, however there are some exceptions. For instance, federal government entities and organizations that received a PPP loan may have limitations on declaring the credit.
The procedure for declaring the ERC involves completing the essential forms and consisting of the credit on your work income tax return (typically Type 941). The exact time it requires to process the credit can differ based upon a number of aspects, consisting of the complexity of your organization and the workload of the IRS. It’s suggested to consult with a tax expert for assistance particular to your scenario.
There are numerous companies that can aid with the procedure of claiming the ERC. These consist of accounting companies, tax advisory services, and payroll provider. Some popular business that offer support with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s recommended to research study and get in touch with these companies straight to inquire about their fees and services.
Please note that the info offered here is based upon general knowledge and may not reflect the most current updates or changes to the ERC. It is essential to speak with a tax expert or go to the official IRS site for the most current and precise information concerning eligibility, declaring procedures, and offered help.
Less than 100. If the company had 100 or less workers on average in 2019, then the credit is based.
on incomes paid to all workers whether they actually worked or not. In other words, even if the.
employees worked full-time and earned money for full-time work, the company still gets the credit.
Greater than 100. If the company had more than 100 workers on average in 2019, then the credit is.
permitted just for incomes paid to workers who did not work throughout the calendar quarter.
In both cases, “salaries” includes not simply cash payments however likewise a portion of the cost of company.
offered healthcare. Partially Suspended Employee Retention Credit
Payment.
Employers can be right away compensated for the credit by lowering the quantity of payroll taxes they.