Lets talk first about Ready Capital Employee Retention Credit :
Our group here what do these men doing everyone in this space is helping teach individuals about ERC and uh always supply a stunning breakfast and have individuals really learn more about the program we must head to the space where we have the ability to show some of the checks that we are getting for companies and I wish to see that what is this this is uh hundreds of millions of dollars literally Kevin hundreds of millions of dollars so these are duplicate copies of the letters that go to clients verifying that the check is on the method I suggest you know if you just begin to 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 simply I indicate think about how many actual clients that went through the program yeah this is the very end this is the party at the end when the check is confirmed the numbers are validated and the check is on the mail in the mail from the internal revenue service heading to the customer so that’s how you have the ability to track it you know when you
receive this you understand 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 do not pay bottom line Wonder trust anything till this letter is validated the check is on the method they deposit it into their bank account and they can really rely on Wonder trust that the procedure has actually been ended up and how many you think you’ve processed since you began 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 need you require experts 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 speaking about something really essential today the staff member retention credit which most of you have actually never ever heard of I definitely had not become aware of it until very just recently and learned a lot about it because this is most likely the lowest expense of capital for any small company 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 Concepts 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 simply contact 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 tell us all 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 disappearing soon you got to learn everything about it let’s talk staff member retention credit Josh Fox what is an ERC let’s just begin there so during the Trump Administration when President Trump was enacted they developed the cares Act and the cares act offered services three chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly everyone it makes a big difference right there 2 of them are loans and one’s a refund exactly so the ERC is a refund that’s.
fix the money cash payroll tax refund all right go on sorry I simply need to ensure we got that point I indicate that’s a big distinction a loan versus cash cash I like cash 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 original cares Act is the ERC and yes Kevin it is a stunning tough check in the mail where you get real cash from the IRS all right so let’s talk 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 Assumption this cash is not for the owner not for people on the cap table not for shareholders it’s for workers right you needed to have actually owned a business however it’s based on you having W-2 workers in America not 10.99. As long as you had W-2 employees and you paid federal payroll taxes that’s why you would be qualified 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 walk 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. alright 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 just how much can you return per employee 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 an optimum of five thousand dollars per staff member for the year of 2020 and in 2021 the numbers increased to 70 of the staff member’s income to a maximum of 7 thousand per quarter how did that take place um they simply changed the rules in.
2021 versus due to the fact that the mayhem 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 approximately 5 thousand Max and after that what takes place 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 worker that is because that’s a great deal of cash it is now there’s a caveat here the PPP money would have 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 usually Kevin is if you took PPP cash somewhere around 10 thousand dollars a person so let’s state hypothetically you owned a restaurant in New York 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 big obviously now the huge question is why does no one learn about this since look when I initially found out about this when I initially met Josh you know I’ve got lots of investments in lots of companies I’m a significant advocate for entrepreneurship in America and make numerous lots of investments in entrepreneurs of which numerous suffered through the pandemic when I initially became aware of this I called BS I do not think it because I utilize the PPP we went through the cash center Banks to get it it was extremely easy to do we had our CEOs call the banks they got their loans and that were well should have and we utilized them wisely to stay alive throughout the pandemic so when I became aware of this I said nah it can’t be true however when I dug around I even called to my political leader friends Governor Senators they didn’t know about it I imply that’s how you know that’s how misinformation is that there’s no information out there then a lot of people informed me well you can’t get it due to the fact that you took the PPP likewise not real so let’s ask Josh why does nobody understand 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 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 simply process process that’s all um and here there was turmoil because remember in the original cares act you could refrain from doing both programs so if you had actually done PPP you could refrain from doing ERC in the original 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 anybody about how to.
do this does your CFO understand how to do this not truly she or he’s never done it in the past do the banks do it nope the banks don’t do it the payroll business yeah a few of them are doing it as a payroll business your accountant no your accounting professional’s never ever done this before unless you have an account that went into this company and bottom line my company Kevin has actually been in business because 2009 and we’ve been working with the federal government and the state government to recover cash for Fortune 500 Fortune 1000 business so a great deal of our huge huge corporate clients have dealt with bottom line to recuperate other federal government programs we have actually done sales tax and use tax joblessness tax work opportunity tax credits research and development tax credits unclaimed home real estate tax all of these other federal government programs.
The staff member 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 incomes paid by an.
Due to the fact that of COVID-19 or whose gross receipts, employer whose company is completely or partly suspended.
decline by more than 50%.
Availability.
1. The credit is available to all employers regardless of size consisting of tax exempt organizations. There are.
just 2 exceptions: (1) state and city governments and their instrumentalities and (2) little.
businesses who take Small Business Loans.
2. To qualify, the company has to satisfy one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the company’s business is fully or partly 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 equivalent quarter in 2019. As soon as the.
company’s gross receipts exceed 80% of a similar quarter in 2019 they no longer qualify.
after the end of that quarter.
Computation of the Credit.
The amount of the credit is 50% of the certifying salaries paid up to $10,000 in total.
It is effective for earnings paid after March 13th and prior to December 31, 2020.
The meaning of qualifying wages differs by whether an employer had, on average, basically than.
100 staff members in 2019.
Business that specialize in ERC filing help typically offer expertise and support to help companies navigate the intricate process of claiming the credit. They can use various services, consisting of:.
How is the employee retention credit calculated? Ready Capital Employee Retention Credit
Eligibility Assessment: These business will assess your company’s eligibility for the ERC based on aspects such as your market, profits, and operations. If you meet the requirements for the credit and recognize the optimum credit quantity you can claim, they can help determine.
Documents and Estimation: ERC filing services will help in gathering the needed paperwork, such as payroll records and financial statements, to support your claim. They will also assist determine the credit quantity based on qualified incomes and other qualifying costs.
Retroactive Claim Evaluation: If you are eligible to claim the ERC for prior quarters, these business can evaluate your past payroll records and financials to determine potential opportunities for retroactive credits. They can assist you amend previous income tax return to claim these refunds.
Filing Support: Business concentrating on ERC filings will prepare and send the necessary types and documents on your behalf. This includes completing Form 941 or any other required tax forms.
Compliance and Updates: ERC policies and guidance have progressed in time. These companies remain upgraded with the current changes and ensure that your filings adhere to the most present standards. If the IRS demands extra information or performs an audit related to your ERC claim, they can likewise provide ongoing assistance.
It’s important to research and veterinarian any business offering ERC filing support to guarantee their credibility and know-how. Try to find recognized companies with experience in tax and payroll services, or consider reaching out to trusted accounting companies or tax specialists who offer ERC filing assistance.
Remember that while these companies can offer valuable support, it’s constantly a great idea to have a standard understanding of the ERC requirements and process yourself. This will assist you make informed decisions and make sure accurate filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit presented by the U.S. federal government as part of COVID-19 relief procedures. The objective of the ERC is to motivate businesses to keep and pay their workers during the pandemic, even if their operations have actually been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is readily available to eligible companies, including for-profit businesses, tax-exempt companies, and particular governmental entities. To certify, employers must meet one of two criteria:.
Business operations were totally or partly suspended due to a government order related to COVID-19.
The business experienced a significant decline in gross receipts. As pointed out earlier, 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 substantial decrease is specified as a 20% decrease 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 employer’s share of Social Security taxes. The credit amount is equal to a percentage (up to 70%) of qualified incomes paid to staff members, consisting of specific health insurance costs. The optimum credit per employee is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, services that got an Income Protection Program (PPP) loan were not qualified for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 enables services to claim the ERC even if they got a PPP loan. Nevertheless, the same incomes can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively broadened and improved, enabling eligible employers to claim the credit for certified incomes paid as far back as March 13, 2020. This retroactive arrangement offers an opportunity for companies to change prior-year income tax return and get refunds.
Declaring the Credit: Companies can claim the ERC by reporting it on their work tax returns, typically Type 941. The excess can be refunded to the employer if the credit exceeds the quantity of work taxes owed.
It is necessary to note that the ERC arrangements and eligibility requirements have actually developed gradually. The best course of action is to seek advice from a tax expert or check out the official internal revenue service site for the most detailed and up-to-date information concerning the ERC, consisting of any recent legal modifications or updates.
To qualify for the ERC, a service should meet among the following requirements:.
The business operations were completely or partly suspended due to a government order related to COVID-19.
Business experienced a substantial decrease in gross receipts. For 2021, a significant decrease is specified as a 20% decline in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a significant decrease is defined as a 20% decrease in gross receipts compared to the same quarter in 2019, or a 20% decline in gross receipts compared to the instantly preceding quarter.
The ERC is available to organizations of all sizes, including tax-exempt companies, however there are some exceptions. For instance, government entities and companies that got a PPP loan may have limitations on claiming the credit.
The procedure for declaring the ERC includes completing the needed kinds and including the credit on your employment tax return (usually Type 941). The exact time it requires to process the credit can vary based on numerous elements, including the intricacy of your service and the work of the IRS. It’s advised to seek advice from a tax expert for guidance particular to your circumstance.
There are a number of companies that can help with the process of declaring the ERC. These include accounting firms, tax advisory services, and payroll company. Some widely known companies that use assistance with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s recommended to research and contact these business straight to ask about their services and charges.
Please keep in mind that the details supplied here is based on general knowledge and may not reflect the most recent updates or changes to the ERC. It’s important to talk to a tax expert or visit the main internal revenue service site for the most updated and precise info concerning eligibility, claiming procedures, and readily available help.
Less than 100. If the company had 100 or less workers usually in 2019, then the credit is based.
on wages paid to all workers whether they really worked or not. In other words, even if the.
employees worked full-time and made money for full-time work, the employer still gets the credit.
Greater than 100. The credit is if the employer had more than 100 employees on average in 2019.
enabled only for salaries paid to staff members who did not work during the calendar quarter.
In both cases, “wages” consists of not just cash payments but likewise a part of the expense of employer.
provided health care. Ready Capital Employee Retention Credit
Payment.
Employers can be right away compensated for the credit by lowering the quantity of payroll taxes they.