Lets talk first about Qualifications For Employee Retention Credit :
Our group here what do these people doing everybody in this space is assisting teach individuals about ERC and uh always provide a stunning breakfast and have people actually discover the program we need to head to the room where we are able to display a few of the checks that we are getting for companies and I want to see that what is this this is uh numerous countless dollars actually Kevin hundreds of millions of 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 start to 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 indicate it’s just I indicate think of how many real clients that went through the program yeah this is the very end this is the celebration at the end when the check is validated 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 understand when you
get this you know the check is opted for sure and that’s when they pay so they don’t pay anything until they really receive the money they don’t pay bottom line Wonder trust anything up until this letter is verified the check is on the way they deposit it into their savings account and they can truly trust Wonder trust that the process has been completed and the number of you think you have actually processed because you started this we have to do with 35 000 of these for
about 6 billion dollars wow so plainly they understand what they’re doing which’s what you require you require experts 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 Terrific here you’re at my YouTube channel we’re speaking about something truly important today the employee retention credit which the majority of you have actually never ever become aware of I certainly had not become aware of it till very just recently and discovered a lot about it because this is probably the most affordable expense of capital for any small business anywhere
anytime if you have workers between five and five hundred so I’ve got the professional with me this is Josh Fox he’s the founder and CEO of bottom line Principles they’re the biggest processor of these ERC credits this is a 170 page program so it’s hard this isn’t like PPP we just phone your bank manager and state offer 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 have actually ended up being yes the Ambassador and paid spokesperson for this I enjoy this program it’s going away very soon you got to discover all about it let’s talk employee retention credit Josh Fox what is an ERC let’s simply start there so during the Trump Administration when President Trump was enacted they came up with the cares Act and the cares act offered organizations 3 chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly everyone it makes a huge difference right there two of them are loans and one’s a refund exactly so the ERC is a refund that’s.
fix the money money payroll tax refund okay go on sorry I just need to make sure we got that point I indicate that’s a big difference a loan versus money money I like cash money that’s what we’re discussing 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 lovely hard 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 staff member retention credit that individual had to be a worker so I’m going to make the Assumption this money is not for the owner not for people on the cap table not for investors it’s for staff members right you needed to have owned a business but it’s based upon you having W-2 staff members in America not 10.99. so as long as you had W-2 employees 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 six months of 2021 on the W-2 proper so there were six quarters the program was open well walk us through the 6 quarters so you had quarters two three and four of 2020 and you had quarters one 2 and three of 2021. okay so that’s how it’s determined you have to be on the W-2 during that period now let’s talk my favorite part cash how much can you get back per worker that was on a W-2 in those 6 quarters so the computation in 2020 to be specific 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 a maximum of seven thousand per quarter how did that occur um they just altered the rules in.
2021 versus since the turmoil of the pandemic so they wanted to even get more to keep those workers on payroll 100 so if you can get 5 000 per person Max in twenty that was 50 in 2020 up to 5 thousand Max and then what happens 21 000 Max in 2021 oh that’s how you develop twenty six thousand twenty one thousand to twenty twenty one plus five thousand in twenty twenty that’s twenty 6 thousand dollars per staff member 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 minimized from the twenty six thousand dollars so if you took PPP loan one and PPP loan 2 you would lower the 26 000 so what we’re seeing on average Kevin is if you took PPP cash someplace around ten thousand dollars a person so let’s say hypothetically you owned a dining establishment in New york city 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 question is why does nobody understand about this because look when I initially found out about this when I first satisfied Josh you know I have actually got great deals of investments in lots of business I’m a major supporter for entrepreneurship in America and make numerous lots of financial investments in business owners of which many suffered through the pandemic when I initially found out about this I called BS I do not believe it since I utilize the PPP we went through the money 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 been worthy of and we utilized them wisely to stay alive throughout the pandemic so when I became aware of this I stated nah it can’t be true but when I dug around I even called to my politician buddies Governor Senators they didn’t know about it I suggest that’s how you understand that’s how misinformation is that there’s no details 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 no one know about the staff member retention credit you know what’s intriguing you’re speaking about the banks Kevin because 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 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 chaos due to the fact that remember in the original cares act you might not do both programs so if you had done PPP you could 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 anyone 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 some of them are doing it as a payroll business your accountant no your accountant’s never ever done this prior to unless you have an account that went into this business and bottom line my company Kevin has actually stayed in business because 2009 and we have actually been working with the federal government and the state federal government to recover cash for Fortune 500 Fortune 1000 business so a lot of our huge huge corporate clients have dealt 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 property tax all of these other federal government programs.
The employee 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 business is fully or partly suspended because of COVID-19 or whose gross invoices.
decrease by more than 50%.
1. The credit is offered to all companies regardless of size including tax exempt companies. There are.
only 2 exceptions: (1) state and local governments and their instrumentalities and (2) small.
companies who take Small company Loans.
2. To certify, the employer needs to fulfill one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the employer’s service is completely or partly suspended by federal government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross receipts are below 50% of the similar quarter in 2019. Once the.
employer’s gross receipts exceed 80% of a similar quarter in 2019 they no longer qualify.
after the end of that quarter.
Estimation of the Credit.
The amount of the credit is 50% of the qualifying earnings paid up to $10,000 in total.
It is effective for earnings paid after March 13th and before December 31, 2020.
The meaning of certifying incomes varies by whether a company had, usually, more or less than.
100 employees in 2019.
Business that concentrate on ERC filing assistance generally supply expertise and support to help organizations navigate the complex procedure of declaring the credit. They can offer different services, including:.
How is the employee retention credit calculated? Qualifications For Employee Retention Credit
Eligibility Assessment: These business will examine your business’s eligibility for the ERC based upon factors such as your market, income, and operations. If you meet the requirements for the credit and recognize the maximum credit amount you can claim, they can help figure out.
Paperwork and Calculation: ERC filing services will help in gathering the required documents, such as payroll records and financial statements, to support your claim. They will also assist calculate the credit quantity based on eligible wages and other qualifying costs.
Retroactive Claim Review: If you are eligible to declare the ERC for prior quarters, these business can evaluate your past payroll records and financials to determine possible opportunities for retroactive credits. They can help you modify previous income tax return to claim these refunds.
Filing Assistance: Companies concentrating on ERC filings will prepare and send the required forms and documents on your behalf. This includes completing Type 941 or any other required tax return.
Compliance and Updates: ERC guidelines and assistance have progressed gradually. These business stay upgraded with the current changes and guarantee that your filings abide by the most present standards. They can also supply continuous assistance if the IRS demands extra information or carries out an audit related to your ERC claim.
It is necessary to research study and veterinarian any company using ERC filing support to guarantee their credibility and expertise. Search for established companies with experience in tax and payroll services, or think about reaching out to relied on accounting companies or tax specialists who offer ERC submitting support.
Keep in mind that while these companies can supply valuable help, it’s always a good idea to have a fundamental understanding of the ERC requirements and procedure yourself. This will assist you make notified choices and make sure accurate filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit presented by the U.S. government as part of COVID-19 relief measures. The goal of the ERC is to encourage businesses to retain and pay their staff members throughout the pandemic, even if their operations have been impacted.
Here are some key points about the ERC:.
Eligibility: The ERC is offered to qualified employers, including for-profit businesses, tax-exempt organizations, and certain governmental entities. To certify, employers need to fulfill one of two requirements:.
Business operations were totally or partially suspended due to a federal government order related to COVID-19.
Business experienced a substantial decline in gross receipts. As discussed previously, for 2021, a significant decrease is specified as a 20% decrease in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a substantial decline is specified as a 20% decline in gross invoices compared to the very same quarter in 2019, or a 20% decrease in gross invoices compared to the instantly preceding quarter.
Credit Amount: The ERC is a refundable tax credit that offsets the employer’s share of Social Security taxes. The credit amount is equal to a portion (as much as 70%) of qualified salaries paid to staff members, including certain 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 received an Income Protection Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 permits businesses to declare the ERC even if they got a PPP loan. The very same incomes can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively broadened and enhanced, enabling eligible employers to claim the credit for certified wages paid as far back as March 13, 2020. This retroactive arrangement supplies a chance for companies to modify prior-year income tax return and receive refunds.
Declaring the Credit: Companies can declare the ERC by reporting it on their work tax returns, generally Kind 941. The excess can be reimbursed to the employer if the credit goes beyond the quantity of work taxes owed.
It is very important to keep in mind that the ERC arrangements and eligibility criteria have actually evolved in time. The very best strategy is to consult with a tax expert or check out the main IRS site for the most comprehensive and updated information concerning the ERC, consisting of any current legal modifications or updates.
To get approved for the ERC, a company needs to satisfy among the following requirements:.
Business operations were completely or partly suspended due to a government order related to COVID-19.
Business experienced a significant decline in gross receipts. For 2021, a substantial decline is specified as a 20% decrease in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a significant decline is specified as a 20% decline in gross invoices compared to the very same quarter in 2019, or a 20% decrease in gross invoices compared to the immediately preceding quarter.
The ERC is readily available to companies of all sizes, including tax-exempt organizations, but there are some exceptions. For example, government entities and services that received a PPP loan may have restrictions on declaring the credit.
The procedure for claiming the ERC involves finishing the required kinds and consisting of the credit on your employment tax return (generally Kind 941). The exact time it takes to process the credit can differ based on numerous factors, consisting of the intricacy of your organization and the workload of the internal revenue service. It’s suggested to speak with a tax professional for guidance particular to your situation.
There are several companies that can assist with the procedure of declaring the ERC. Some widely known companies that offer support with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the info provided here is based upon general knowledge and might not show the most current updates or changes to the ERC. It is necessary to talk to a tax expert or visit the official IRS site for the most accurate and updated info relating to eligibility, claiming treatments, and offered help.
Less than 100. If the employer had 100 or less staff members usually in 2019, then the credit is based.
on wages paid to all workers whether they really worked or not. Simply put, 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 employees on average in 2019, then the credit is.
enabled only for salaries paid to employees who did not work during the calendar quarter.
In both cases, “incomes” includes not just money payments however also a part of the expense of employer.
offered health care. Qualifications For Employee Retention Credit
Companies can be instantly compensated for the credit by decreasing the amount of payroll taxes they.