Lets talk first about Tony Nitti Employee Retention Credit Part 2 :
Our group here what do these people doing everybody in this room is helping teach individuals about ERC and uh always offer a beautiful breakfast and have people really find out about the program we ought to head to the room where we are able to display some of the checks that we are getting for companies and I want to see that what is this this is uh numerous millions of dollars actually Kevin numerous countless dollars so these are replicate copies of the letters that go to customers confirming that the check is on the method I mean you know if you simply 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 indicate it’s simply I mean think about 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 confirmed the numbers are validated 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 understand the check is gone for sure and that’s when they pay so they do not pay anything until they in fact receive the cash they don’t pay bottom line Wonder trust anything till this letter is verified the check is on the method they transfer it into their savings account and they can truly trust Wonder trust that the procedure has been completed and how many you believe you have actually processed since you began this we have to do with 35 000 of these for
about six billion dollars wow so clearly 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 one of these that’s what matters all right Mr Terrific here you’re at my YouTube channel we’re discussing something actually important today the staff member retention credit which the majority of you have never heard of I definitely had not heard of it up until extremely recently and found out a lot about it since this is probably the lowest cost of capital for any small business anywhere
anytime if you have employees in 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 largest processor of these ERC credits this is a 170 page program so it’s difficult this isn’t like PPP we simply contact your bank manager 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 us all about it and how to get it and why I’ve ended up being yes the Ambassador and paid spokesperson 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 simply start there so during the Trump Administration when President Trump was enacted they developed the cares Act and the cares act provided organizations three chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and almost everyone it makes a huge 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 money payroll tax refund all right go on sorry I just need to make certain we got that point I suggest that’s a huge distinction a loan versus cash cash I like cash money that’s what we’re speaking 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 talk about how it works since it sounds like to me if it’s a if it’s staff member retention credit that individual had to be an employee 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 employees right you needed to have actually owned a service however it’s based upon you having W-2 staff members 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 6 months of 2021 on the W-2 appropriate so there were six quarters the program was open well stroll us through the six quarters so you had quarters two 3 and four of 2020 and you had quarters one two 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 money how much can you return per staff member that was on a W-2 in those six quarters so the estimation in 2020 to be exact Kevin is 50 of the worker’s income to an optimum of five thousand dollars per staff member for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the staff member’s wage to an optimum of 7 thousand per quarter how did that happen um they simply changed the rules in.
2021 versus because 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 5 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 5 thousand in twenty twenty that’s twenty six thousand dollars per staff member that is because that’s a lot of money it is now there’s a caution here the PPP money would have to be lowered from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan two you would reduce the 26 000 so what we’re seeing on average Kevin is if you took PPP cash someplace around 10 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 employees and you took PPP cash you would still get a million dollar in the mail from the IRS so it’s substantial certainly now the huge question is why does nobody know about this due to the fact that appearance when I initially became aware of this when I first fulfilled Josh you know I have actually got lots of financial investments in great deals of business I’m a major advocate for entrepreneurship in America and make many lots of investments in business owners of which many suffered through the pandemic when I first found out about this I called BS I don’t think it due to the fact that I utilize the PPP we went through the cash center Banks to get it it was very easy to do we had our CEOs call the banks they got their loans and that were well deserved and we used them wisely to survive during the pandemic so when I found out about this I stated nah it can’t be true but when I dug around I even contacted us to my political leader buddies Guv Senators they didn’t understand about it I imply that’s how you know 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 since you took the PPP also not real so let’s ask Josh why does nobody know about the worker retention credit you know what’s intriguing you’re talking about the banks Kevin since in the PPP loan procedure the federal government made it really 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 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 since 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 not 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 any person about how to.
do this does your CFO know how to do this not truly she or he’s never ever done it before do the banks do it nope the banks don’t do it the payroll companies yeah a few 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 stayed in business because 2009 and we’ve been dealing with the federal government and the state federal government to recover cash for Fortune 500 Fortune 1000 business so a great deal of our huge huge business customers have actually 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 property tax all of these other federal government programs.
The staff member retention tax credit is a broad based refundable tax credit developed to encourage.
companies to keep employees on their payroll. The credit is 50% of up to $10,000 in wages paid by an.
company whose business is fully or partly suspended because of COVID-19 or whose gross receipts.
decline by more than 50%.
Schedule.
1. The credit is readily available to all employers no matter size including tax exempt organizations. There are.
just two exceptions: (1) state and local governments and their instrumentalities and (2) little.
businesses who take Small company Loans.
2. To certify, the employer needs to fulfill one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the company’s company is totally or partially suspended by federal government order due to COVID-19.
during the calendar quarter or.
o the company’s gross receipts are below 50% of the similar quarter in 2019. Once the.
company’s gross receipts go above 80% of an equivalent quarter in 2019 they no longer certify.
after the end of that quarter.
Calculation of the Credit.
The quantity of the credit is 50% of the qualifying salaries paid up to $10,000 in total.
It is effective for salaries paid after March 13th and before December 31, 2020.
The meaning of qualifying earnings differs by whether a company had, usually, more or less than.
100 workers in 2019.
Business that concentrate on ERC filing support typically provide proficiency and assistance to help companies browse the complicated procedure of declaring the credit. They can provide numerous services, including:.
How is the employee retention credit calculated? Tony Nitti Employee Retention Credit Part 2
Eligibility Assessment: These business will evaluate your company’s eligibility for the ERC based on factors such as your market, revenue, and operations. They can assist determine if you fulfill the requirements for the credit and recognize the optimum credit amount you can declare.
Documentation and Computation: ERC filing services will assist in gathering the required documents, such as payroll records and financial statements, to support your claim. They will likewise assist determine the credit quantity based upon eligible earnings and other qualifying expenditures.
Retroactive Claim Evaluation: If you are qualified to declare the ERC for prior quarters, these business can review your previous payroll records and financials to determine prospective chances for retroactive credits. They can help you change previous income tax return to claim these refunds.
Filing Assistance: Business concentrating on ERC filings will prepare and submit the required kinds and documents in your place. This consists of completing Type 941 or any other necessary tax forms.
Compliance and Updates: ERC policies and assistance have actually evolved with time. These business remain upgraded with the current changes and guarantee that your filings abide by the most current standards. If the Internal revenue service demands additional information or carries out an audit related to your ERC claim, they can also provide ongoing support.
It is necessary to research study and vet any business using ERC filing help to guarantee their credibility and knowledge. Search for established firms with experience in tax and payroll services, or think about reaching out to trusted accounting companies or tax professionals who provide ERC filing assistance.
Keep in mind that while these companies can supply valuable help, it’s constantly a good concept to have a basic understanding of the ERC requirements and process yourself. This will help you make informed choices and guarantee precise filings.
The Worker Retention Credit (ERC) is a refundable tax credit presented by the U.S. federal government as part of COVID-19 relief measures. The objective of the ERC is to encourage services to keep and pay their staff members throughout the pandemic, even if their operations have been affected.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is available to eligible companies, consisting of for-profit organizations, tax-exempt organizations, and particular governmental entities. To qualify, employers must meet one of two criteria:.
The business operations were completely or partially 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 substantial decrease is specified as a 20% decline in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a substantial decrease is defined as a 20% decrease in gross invoices compared to the same quarter in 2019, or a 20% decline in gross receipts compared to the right away preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the employer’s share of Social Security taxes. The credit quantity amounts to a portion (up to 70%) of qualified wages paid to workers, consisting of specific health insurance expenditures. The optimum credit per staff member is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: At first, services that got an Income Defense Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 allows organizations to claim the ERC even if they got a PPP loan. Nevertheless, the very same earnings can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has actually been retroactively expanded and enhanced, permitting qualified employers to declare the credit for qualified incomes paid as far back as March 13, 2020. This retroactive arrangement supplies a chance for businesses to amend prior-year tax returns and get refunds.
Claiming the Credit: Employers can declare the ERC by reporting it on their work income tax return, normally Kind 941. The excess can be refunded to the employer if the credit goes beyond the quantity of employment taxes owed.
It is very important to note that the ERC arrangements and eligibility requirements have evolved over time. The best strategy is to seek advice from a tax expert or visit the official internal revenue service website for the most current and detailed details concerning the ERC, including any recent legislative modifications or updates.
To get approved for the ERC, a company should meet one of the following requirements:.
The business operations were completely or partly suspended due to a government order related to COVID-19.
The business experienced a considerable decrease in gross invoices. For 2021, a considerable decline is specified 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% decrease 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, including tax-exempt organizations, but there are some exceptions. Federal government entities and businesses that got a PPP loan may have restrictions on declaring the credit.
The procedure for declaring the ERC includes finishing the necessary types and including the credit on your work tax return (normally Form 941). The exact time it takes to process the credit can differ based on several factors, including the complexity of your company and the workload of the internal revenue service. It’s advised to seek advice from a tax expert for guidance specific to your circumstance.
There are several companies that can assist with the procedure of claiming the ERC. Some popular companies that use assistance with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the information provided here is based upon general understanding and might not reflect the most current updates or changes to the ERC. It is very important to talk to a tax professional or go to the official internal revenue service website for the most updated and accurate information regarding eligibility, declaring procedures, and readily available assistance.
Less than 100. If the company had 100 or less workers usually in 2019, then the credit is based.
on incomes paid to all employees whether they really worked or not. In other words, even if the.
employees worked full time and made money for full-time work, the company still gets the credit.
Greater than 100. If the company had more than 100 employees typically in 2019, then the credit is.
allowed only for earnings paid to employees 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. Tony Nitti Employee Retention Credit Part 2
Payment.
Companies can be immediately compensated for the credit by minimizing the amount of payroll taxes they.