Lets talk first about What Is Employee Retention Credit Program :
Our team here what do these people doing everyone in this room is assisting teach individuals about ERC and uh constantly supply a beautiful breakfast and have individuals truly learn about the program we should head to the space where we are able 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 countless dollars actually Kevin numerous countless dollars so these are duplicate copies of the letters that go to customers validating that the check is on the way I indicate you understand if you simply begin 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 indicate it’s just I suggest think about the number of real customers 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 client so that’s how you have the ability to track it you understand when you
receive this you know the check is opted for sure which’s when they pay so they don’t pay anything until they really get the money they do not pay bottom line Wonder trust anything until this letter is validated the check is on the method they transfer it into their checking account and they can truly trust Wonder trust that the procedure has actually been ended up and how many you believe you have actually processed because you started this we have to do with 35 000 of these for
about six billion dollars wow so plainly they know what they’re doing and that’s what you require you require specialists 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 crucial today the worker retention credit which the majority of you have actually never heard of I definitely had not become aware of it until very recently and learned a lot about it due to the fact that this is probably the lowest expense of capital for any small company anywhere
anytime if you have staff members between 5 and five hundred so I have actually got the specialist with me this is Josh Fox he’s the founder and CEO of bottom line Concepts they’re the largest processor of these ERC credits this is a 170 page program so it’s not easy this isn’t like PPP we just call up your bank supervisor and state give me a loan it doesn’t 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’ve ended up being yes the Ambassador and paid spokesperson for this I love this program it’s going away soon you got to discover 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 offered businesses three opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly everybody it makes a big distinction 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 just need to make sure we got that point I suggest that’s a huge distinction a loan versus cash money I like money cash that’s what we’re talking about fine 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 money from the IRS all right so let’s speak about how it works since it sounds like to me if it’s a if it’s employee retention credit that person had to be an employee 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 needed to have owned a business but it’s based on you having W-2 staff members in America not 10.99. so as long as you had W-2 workers 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 appropriate so there were six quarters the program was open well walk us through the 6 quarters so you had quarters two 3 and four of 2020 and you had quarters one two and 3 of 2021. all right so that’s how it’s measured you have to be on the W-2 during that duration now let’s talk my preferred part cash just how much can you get back per staff member that was on a W-2 in those six quarters so the computation in 2020 to be precise 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 increased to 70 of the employee’s wage to a maximum of 7 thousand per quarter how did that happen um they simply changed the rules in.
2021 versus because 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 as much as five thousand Max and then what takes place 21 000 Max in 2021 oh that’s how you create twenty six thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty 6 thousand dollars per staff member that is since that’s a lot of money it is now there’s a caveat here the PPP money would have to be decreased from the twenty six thousand dollars so if you took PPP loan one and PPP loan 2 you would decrease the 26 000 so what we’re seeing typically Kevin is if you took PPP cash somewhere around ten thousand dollars a person so let’s say hypothetically you owned a dining establishment in New York 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 big obviously now the big concern is why does no one learn about this due to the fact that look when I initially heard about this when I first satisfied Josh you know I’ve got great deals of financial investments in great deals of companies I’m a major supporter for entrepreneurship in America and make lots of many financial investments in entrepreneurs of which numerous suffered through the pandemic when I first found out about this I called BS I don’t think it since I use 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 should have and we used them wisely to survive during the pandemic so when I became aware of this I stated nah it can’t be true but when I dug around I even contacted us to my politician pals Governor Senators they didn’t learn about it I suggest that’s how you know that’s how misinformation is that there’s no details out there then a bunch of individuals informed me well you can’t get it due to the fact that you took the PPP likewise not true so let’s ask Josh why does no one know about the employee retention credit you know what’s intriguing you’re speaking about the banks Kevin because in the PPP loan process 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 procedure in Canada a pre-pp loan there’s no loans in Canada by the way it’s just process process that’s all um and here there was chaos since remember in the initial 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 altered the law in 2021 the banks were refraining from doing ERC because 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 know how to do this not truly she or he’s never ever done it previously 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 company your accountant no your accountant’s never done this prior to unless you have an account that entered into this organization and bottom line my company Kevin has actually been 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 companies so a lot of our big huge business customers have actually dealt with bottom line to recover other 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 created to encourage.
employers to keep staff members on their payroll. The credit is 50% of approximately $10,000 in wages paid by an.
Due to the fact that of COVID-19 or whose gross receipts, employer whose organization is fully or partly suspended.
decrease by more than 50%.
Availability.
1. The credit is 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.
organizations who take Small Business Loans.
2. To qualify, the employer needs to meet one of two alternative tests. The tests are calculated 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 invoices are listed below 50% of the equivalent quarter in 2019. When the.
employer’s gross receipts go above 80% of a comparable quarter in 2019 they no longer qualify.
after the end of that quarter.
Computation of the Credit.
The quantity of the credit is 50% of the qualifying earnings paid up to $10,000 in overall.
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, usually, more or less than.
100 workers in 2019.
Companies that focus on ERC filing assistance generally provide competence and assistance to assist services browse the intricate process of declaring the credit. They can use numerous services, including:.
How is the employee retention credit calculated? What Is Employee Retention Credit Program
Eligibility Assessment: These companies will examine your company’s eligibility for the ERC based on elements such as your market, revenue, and operations. They can assist figure out if you satisfy the requirements for the credit and recognize the maximum credit amount you can claim.
Documentation and Estimation: ERC filing services will assist in collecting the required paperwork, such as payroll records and monetary statements, to support your claim. They will also help calculate the credit amount based upon qualified earnings and other qualifying expenditures.
Retroactive Claim Review: If you are eligible to claim the ERC for previous quarters, these companies can examine your past payroll records and financials to identify potential opportunities for retroactive credits. They can help you modify prior tax returns to claim these refunds.
Filing Support: Companies concentrating on ERC filings will prepare and send the necessary kinds and documents on your behalf. This includes finishing Kind 941 or any other required tax forms.
Compliance and Updates: ERC regulations and guidance have actually evolved gradually. These companies stay upgraded with the most recent changes and guarantee that your filings adhere to the most present guidelines. They can likewise offer ongoing support if the internal revenue service demands extra info or performs an audit related to your ERC claim.
It is necessary to research study and vet any business providing ERC filing help to guarantee their trustworthiness and expertise. Search for recognized companies with experience in tax and payroll services, or consider connecting to relied on accounting companies or tax professionals who use ERC filing assistance.
Remember that while these companies can offer important support, it’s constantly a great idea to have a fundamental understanding of the ERC requirements and process yourself. This will help you make notified decisions and make sure accurate filings.
The Worker 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 motivate organizations to retain and pay their employees during the pandemic, even if their operations have been affected.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is readily available to qualified companies, consisting of for-profit services, tax-exempt companies, and specific governmental entities. To qualify, employers need to meet one of two requirements:.
The business operations were fully or partly suspended due to a federal government order related to COVID-19.
The business experienced a considerable decrease in gross invoices. As mentioned earlier, for 2021, a significant decline is specified as a 20% decline in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a considerable decline is defined as a 20% decrease in gross receipts compared to the exact same quarter in 2019, or a 20% decrease 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 amount amounts to a portion (as much as 70%) of certified wages paid to staff members, consisting of certain health plan expenses. The optimum credit per worker is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, services that received a Paycheck Defense Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 enables organizations to declare the ERC even if they got a PPP loan. However, the same earnings can not be utilized to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively broadened and improved, enabling qualified employers to declare the credit for certified salaries paid as far back as March 13, 2020. This retroactive provision provides a chance for organizations to amend prior-year income tax return and receive refunds.
Declaring the Credit: Employers can declare the ERC by reporting it on their work tax returns, generally Kind 941. The excess can be reimbursed to the company if the credit exceeds the quantity of work taxes owed.
It is essential to note that the ERC provisions and eligibility requirements have evolved with time. The best course of action is to speak with a tax expert or check out the official IRS site for the most in-depth and current information concerning the ERC, including any current legal modifications or updates.
To qualify for the ERC, a company should meet among the following criteria:.
The business operations were fully or partially suspended due to a federal government order related to COVID-19.
The business experienced a substantial decline in gross invoices. For 2021, a considerable decrease is defined as a 20% decrease in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a considerable decrease is specified as a 20% decline in gross invoices compared to the same quarter in 2019, or a 20% decline in gross receipts compared to the immediately preceding quarter.
The ERC is readily available to organizations of all sizes, including tax-exempt companies, but there are some exceptions. Federal government entities and businesses that received a PPP loan might have constraints on declaring the credit.
The procedure for declaring the ERC involves finishing the needed types and consisting of the credit on your employment tax return (normally Type 941). The exact time it takes to process the credit can vary based upon numerous factors, consisting of the complexity of your company and the work of the IRS. It’s recommended to seek advice from a tax expert for assistance particular to your scenario.
There are a number of companies that can assist with the procedure of declaring the ERC. Some popular companies that provide assistance with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the information offered here is based upon general understanding and might not reflect the most recent updates or changes to the ERC. It’s important to consult with a tax expert or go to the main internal revenue service site for the most accurate and current information concerning eligibility, declaring treatments, and available support.
Less than 100. The credit is based if the employer had 100 or less staff members on average in 2019.
on earnings paid to all employees whether they actually worked or not. In other words, even if the.
employees worked full time and earned 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 incomes paid to workers who did not work during the calendar quarter.
In both cases, “incomes” includes not simply money payments however likewise a portion of the cost of employer.
offered healthcare. What Is Employee Retention Credit Program
Payment.
Companies can be immediately compensated for the credit by minimizing the amount of payroll taxes they.