Lets talk first about What Are The Qualifications For The Employee Retention Credit :
Our team here what do these guys doing everybody in this space is helping teach individuals about ERC and uh constantly offer a beautiful breakfast and have people truly discover the program we need to head to the room where we are able to display some of the checks that we are getting for companies and I wish to see that what is this this is uh numerous millions of dollars literally Kevin hundreds of millions of dollars so these are replicate copies of the letters that go to clients validating that the check is on the way I imply you know if you simply start to take a look at some of these here I imply this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I mean it’s simply I indicate consider 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 verified and the check is on the mail in the mail from the IRS heading to the consumer so that’s how you have the ability to track it you know when you
get this you know the check is chosen sure which’s when they pay so they do not pay anything up until they in fact get the cash they don’t pay bottom line Wonder trust anything until this letter is validated the check is on the way they transfer it into their bank account and they can genuinely rely on Wonder trust that the procedure has been finished and the number of you think you have actually processed since you began this we have to do with 35 000 of these for
about 6 billion dollars wow so plainly they know what they’re doing which’s what you need you require professionals 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 actually important today the staff member retention credit which the majority of you have never heard of I certainly hadn’t heard of it till extremely just recently and discovered a lot about it due to the fact that this is most likely the lowest expense of capital for any small company anywhere
anytime if you have employees between 5 and five hundred so I have actually got the specialist with me this is Josh Fox he’s the creator and CEO of bottom line Ideas they’re the biggest processor of these ERC credits this is a 170 page program so it’s not easy this isn’t like PPP we just phone your bank supervisor and state offer 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 find out everything about it let’s talk staff member retention credit Josh Fox what is an ERC let’s just begin there so throughout the Trump Administration when President Trump was enacted they created the cares Act and the cares act used companies 3 chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically everyone 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.
remedy the money money payroll tax refund okay go on sorry I just have to make certain we got that point I mean that’s a big difference a loan versus money cash I like money cash that’s what we’re talking about alright 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 hard check in the mail where you get real money 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 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 owned a business but it’s based on you having W-2 staff members 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 first six months of 2021 on the W-2 proper so there were 6 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. okay so that’s how it’s determined you need 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 six quarters so the computation in 2020 to be specific Kevin is 50 of the staff member’s income to an optimum of 5 thousand dollars per staff member for the year of 2020 and in 2021 the numbers escalated to 70 of the staff member’s salary to a maximum of seven thousand per quarter how did that occur um they just altered the rules in.
2021 versus since the mayhem 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 develop twenty six thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty six thousand dollars per employee that is since that’s a great deal of money it is now there’s a caveat here the PPP money would have to be reduced from the twenty six thousand dollars so if you took PPP loan one and PPP loan two you would minimize the 26 000 so what we’re seeing on average Kevin is if you took PPP money somewhere around ten thousand dollars an individual so let’s state hypothetically you owned a dining establishment 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 IRS so it’s huge certainly now the big concern is why does nobody learn about this since appearance when I initially found out about this when I first met Josh you understand I’ve got great deals of investments in great deals of business I’m a significant supporter for entrepreneurship in America and make lots of numerous investments in business owners of which numerous suffered through the pandemic when I initially became aware of this I called BS I do not think it since I use 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 deserved and we utilized them sensibly to survive during the pandemic so when I became aware of this I stated nah it can’t hold true but when I dug around I even called to my political leader buddies Governor Senators they didn’t understand about it I indicate that’s how you understand that’s how false information is that there’s no details out there then a bunch of individuals informed me well you can’t get it since you took the PPP also not real so let’s ask Josh why does nobody understand about the worker retention credit you know what’s fascinating you’re talking about the banks Kevin because 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 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 mayhem because keep in mind in the initial cares act you could refrain from doing both programs so if you had actually done PPP you might not do 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 made it clear to anybody about how to.
do this does your CFO understand how to do this not truly 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 firm Kevin has actually stayed in business since 2009 and we have actually been dealing with the federal government and the state government to recover cash for Fortune 500 Fortune 1000 business so a lot of our big huge corporate customers have actually worked with bottom line to recuperate 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 real estate tax all of these other federal government programs.
The staff member retention tax credit is a broad based refundable tax credit created to encourage.
employers to keep workers on their payroll. The credit is 50% of approximately $10,000 in earnings paid by an.
Since of COVID-19 or whose gross receipts, company whose organization is fully or partially suspended.
decline by more than 50%.
Schedule.
1. The credit is readily available to all companies despite size consisting of tax exempt organizations. There are.
only 2 exceptions: (1) state and local governments and their instrumentalities and (2) little.
services who take Small Business Loans.
2. To certify, the employer has to satisfy one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the employer’s service is fully or partly suspended by federal government order due to COVID-19.
during the calendar quarter or.
o the employer’s gross invoices are below 50% of the equivalent quarter in 2019. As soon as the.
employer’s gross invoices exceed 80% of a similar quarter in 2019 they no longer qualify.
after completion of that quarter.
Calculation of the Credit.
The quantity of the credit is 50% of the qualifying salaries paid up to $10,000 in overall.
It works for salaries paid after March 13th and prior to December 31, 2020.
The definition of qualifying wages varies by whether a company had, typically, basically than.
100 employees in 2019.
Companies that specialize in ERC filing help generally provide competence and support to assist companies navigate the complex process of claiming the credit. They can use different services, consisting of:.
How is the employee retention credit calculated? What Are The Qualifications For The Employee Retention Credit
Eligibility Evaluation: These companies will assess your company’s eligibility for the ERC based upon elements such as your market, revenue, and operations. They can assist determine if you satisfy the requirements for the credit and determine the maximum credit quantity you can claim.
Paperwork and Computation: ERC filing services will assist in gathering the required paperwork, such as payroll records and financial declarations, to support your claim. They will also help determine the credit amount based upon qualified salaries and other certifying costs.
Retroactive Claim Evaluation: If you are qualified to claim the ERC for prior quarters, these companies can examine your previous payroll records and financials to recognize prospective opportunities for retroactive credits. They can assist you amend previous tax returns to claim these refunds.
Filing Help: Business focusing on ERC filings will prepare and submit the necessary forms and documents on your behalf. This consists of finishing Type 941 or any other necessary tax forms.
Compliance and Updates: ERC guidelines and assistance have actually evolved gradually. These companies stay updated with the current changes and ensure that your filings comply with the most existing standards. If the Internal revenue service requests extra information or carries out an audit related to your ERC claim, they can also supply ongoing assistance.
It is necessary to research and veterinarian any business providing ERC filing assistance to ensure their reliability and know-how. Try to find recognized companies with experience in tax and payroll services, or consider connecting to trusted accounting firms or tax experts who provide ERC filing support.
Bear in mind that while these companies can offer important support, it’s constantly a great idea to have a standard understanding of the ERC requirements and process yourself. This will help you make informed 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 procedures. The goal of the ERC is to motivate organizations to keep and pay their employees throughout the pandemic, even if their operations have been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is readily available to eligible employers, consisting of for-profit businesses, tax-exempt companies, and certain governmental entities. To certify, companies must fulfill one of two requirements:.
Business operations were completely or partially suspended due to a federal government order related to COVID-19.
The business experienced a substantial decrease in gross invoices. As pointed out previously, for 2021, a substantial decline is defined as a 20% decrease in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a significant decrease is defined 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 (up to 70%) of certified earnings paid to workers, consisting of certain 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, organizations that got a Paycheck Security Program (PPP) loan were not qualified for the ERC. However, legislation passed in late 2020 and extended in 2021 enables companies to claim the ERC even if they got a PPP loan. However, the same salaries can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively broadened and enhanced, allowing eligible companies to claim the credit for qualified earnings paid as far back as March 13, 2020. This retroactive arrangement provides an opportunity for services to modify prior-year tax returns and get refunds.
Claiming the Credit: Companies can declare the ERC by reporting it on their employment tax returns, usually Kind 941. The excess can be reimbursed to the employer if the credit exceeds the amount of work taxes owed.
It is essential to note that the ERC arrangements and eligibility criteria have actually evolved in time. The very best strategy is to seek advice from a tax professional or go to the official internal revenue service site for the most detailed and updated details relating to the ERC, consisting of any current legislative changes or updates.
To receive the ERC, an organization must satisfy among the following criteria:.
The business operations were completely or partly suspended due to a government order related to COVID-19.
The business experienced a substantial decline in gross receipts. For 2021, a substantial decrease is defined 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% decline in gross invoices compared to the very same quarter in 2019, or a 20% decrease in gross receipts compared to the immediately preceding quarter.
The ERC is available to companies of all sizes, consisting of tax-exempt companies, but there are some exceptions. For instance, government entities and companies that received a PPP loan may have constraints on declaring the credit.
The procedure for declaring the ERC includes finishing the essential types and including the credit on your work income tax return (usually Type 941). The exact time it takes to process the credit can vary based on several elements, including the intricacy of your business and the work of the IRS. It’s advised to seek advice from a tax expert for assistance specific to your circumstance.
There are numerous companies that can assist with the procedure of claiming the ERC. These consist of accounting companies, tax advisory services, and payroll provider. Some well-known business that use assistance with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s advisable to research and call these companies straight to inquire about their services and costs.
Please keep in mind that the details offered here is based upon basic knowledge and might not reflect the most current updates or changes to the ERC. It is very important to talk to a tax professional or visit the official internal revenue service site for the most current and precise details relating to eligibility, declaring procedures, and offered assistance.
Less than 100. If the employer had 100 or fewer workers on average in 2019, then the credit is based.
on salaries paid to all workers whether they in fact worked or not. Simply put, even if the.
employees worked full-time and got paid for full-time work, the employer still gets the credit.
Greater than 100. If the employer had more than 100 workers typically in 2019, then the credit is.
allowed only for incomes paid to workers who did not work throughout the calendar quarter.
In both cases, “earnings” consists of not just money payments however likewise a part of the expense of employer.
supplied health care. What Are The Qualifications For The Employee Retention Credit
Payment.
Companies can be instantly repaid for the credit by lowering the quantity of payroll taxes they.