Lets talk first about What Is The Employee Retention Credit For Employers :
Our group here what do these men doing everybody in this room is helping teach individuals about ERC and uh always offer a beautiful breakfast and have individuals actually learn more about the program we need to head to the room where we are able to show a few of the checks that we are getting for companies and I ‘d like 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 method I imply you understand if you simply begin to take a look at a few of these here I suggest this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I suggest it’s just I mean think of 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 internal revenue service heading to the client so that’s how you have the ability to track it you know when you
receive this you know the check is opted for sure and that’s when they pay so they do not pay anything until they in fact get the money they don’t pay bottom line Wonder trust anything up until this letter is validated the check is on the way they transfer it into their savings account and they can really trust Wonder trust that the procedure has actually been completed and the number of you think you’ve processed considering that you started this we’re about 35 000 of these for
about 6 billion dollars wow so clearly they understand what they’re doing which’s what you require you need specialists 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 Wonderful here you’re at my YouTube channel we’re speaking about something truly crucial today the staff member retention credit which the majority of you have never ever become aware of I certainly hadn’t heard of it till extremely recently and found out 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 staff members between five 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 biggest processor of these ERC credits this is a 170 page program so it’s hard this isn’t like PPP we simply call your bank supervisor and say provide 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 become yes the Ambassador and paid spokesperson for this I like this program it’s going away soon you got to learn everything about it let’s talk employee retention credit Josh Fox what is an ERC let’s simply begin there so during the Trump Administration when President Trump was enacted they developed the cares Act and the cares act provided services 3 opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically 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 cash money payroll tax refund okay go on sorry I simply have to ensure we got that point I suggest that’s a big distinction a loan versus money money 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 beautiful tough check in the mail where you get real cash from the internal revenue service all right so let’s talk about how it works due to the fact that it seems like to me if it’s a if it’s employee retention credit that individual needed 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 needed to have actually owned an organization but it’s based on you having W-2 workers in America not 10.99. 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 6 months of 2021 on the W-2 right so there were 6 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 two and three of 2021. okay so that’s how it’s measured you have to be on the W-2 during that period now let’s talk my preferred part cash how much can you get back 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 staff member’s wage to a maximum of five thousand dollars per staff member for the year of 2020 and in 2021 the numbers escalated to 70 of the employee’s wage to an optimum of 7 thousand per quarter how did that occur um they just changed the rules in.
2021 versus since the mayhem of the pandemic so they wished 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 approximately 5 thousand Max and after that what happens 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 since that’s a great deal of money it is now there’s a caveat here the PPP cash would need to be reduced from the twenty six 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 somewhere around 10 thousand dollars a person so let’s state hypothetically you owned a dining establishment in New york city City where I’m from and you had a hundred workers and you took PPP cash you would still get a million dollar in the mail from the IRS so it’s substantial undoubtedly now the big question is why does nobody learn about this since appearance when I initially became aware of this when I initially met Josh you know I have actually got great deals of investments in great deals of companies I’m a major supporter for entrepreneurship in America and make lots of numerous investments in business owners of which lots of suffered through the pandemic when I first became aware of this I called BS I do not think it due to the fact that I use the PPP we went through the money center Banks to get it it was extremely easy to do we had our CEOs call the banks they got their loans which were well deserved and we used them sensibly to stay alive during the pandemic so when I found out about this I stated nah it can’t hold true but when I dug around I even contacted us to my political leader good friends Guv Senators they didn’t know about it I suggest that’s how you understand that’s how false information is that there’s no info out there then a lot of individuals informed me well you can’t get it due to the fact that you took the PPP also not real so let’s ask Josh why does nobody understand about the staff member retention credit you know what’s fascinating you’re discussing the banks Kevin because in the PPP loan procedure the federal government made it really clear that if you desired 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 mayhem because remember in the original cares act you might not do both programs so if you had done PPP you might not do ERC in the original program and when they changed 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 federal government never made it clear to anybody about how to.
do this does your CFO understand how to do this not really she or he’s never done it before do the banks do it nope the banks do not do it the payroll business yeah some of them are doing it as a payroll company your accountant no your accounting professional’s never ever done this prior to unless you have an account that entered into this service and bottom line my company Kevin has been in business considering that 2009 and we’ve been dealing with the federal government and the state federal government to recover money for Fortune 500 Fortune 1000 companies so a great deal of our huge big business customers have dealt with bottom line to recuperate other government programs we have actually done sales tax and use tax unemployment tax work opportunity tax credits research and development tax credits unclaimed property property 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 staff members on their payroll. The credit is 50% of up to $10,000 in earnings paid by an.
employer whose service is completely or partly suspended because of COVID-19 or whose gross invoices.
decrease by more than 50%.
Accessibility.
1. The credit is offered to all companies no matter size consisting of tax exempt organizations. There are.
just 2 exceptions: (1) state and local governments and their instrumentalities and (2) small.
services who take Small Business Loans.
2. To qualify, the company needs to fulfill one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the employer’s organization is totally or partly suspended by government order due to COVID-19.
throughout the calendar quarter or.
o the employer’s gross invoices are listed below 50% of the comparable quarter in 2019. As soon as the.
employer’s gross receipts go above 80% of an equivalent quarter in 2019 they no longer qualify.
after completion of that quarter.
Computation of the Credit.
The quantity of the credit is 50% of the qualifying salaries paid up to $10,000 in total.
It works for salaries paid after March 13th and before December 31, 2020.
The definition of qualifying wages varies by whether an employer had, usually, basically than.
100 employees in 2019.
Companies that specialize in ERC filing support typically provide competence and support to help companies navigate the complicated process of claiming the credit. They can provide different services, including:.
How is the employee retention credit calculated? What Is The Employee Retention Credit For Employers
Eligibility Assessment: These business will evaluate your organization’s eligibility for the ERC based upon aspects such as your industry, income, and operations. They can help figure out if you meet the requirements for the credit and recognize the optimum credit amount you can claim.
Documents and Estimation: ERC filing services will help in collecting the required paperwork, such as payroll records and financial statements, to support your claim. They will also assist determine the credit amount based on eligible earnings and other certifying expenses.
Retroactive Claim Evaluation: If you are eligible to declare the ERC for previous quarters, these business can evaluate your previous payroll records and financials to recognize potential chances for retroactive credits. They can assist you amend previous tax returns to declare these refunds.
Filing Assistance: Business specializing in ERC filings will prepare and send the necessary types and documents in your place. This includes finishing Form 941 or any other necessary tax forms.
Compliance and Updates: ERC policies and guidance have developed over time. These business remain updated with the current changes and guarantee that your filings adhere to the most present guidelines. If the Internal revenue service requests extra information or conducts an audit related to your ERC claim, they can also offer ongoing assistance.
It is necessary to research study and veterinarian any company using ERC filing support to guarantee their credibility and knowledge. Try to find recognized firms with experience in tax and payroll services, or consider connecting to trusted accounting companies or tax professionals who use ERC filing support.
Bear in mind that while these companies can provide valuable help, it’s constantly a good idea to have a fundamental understanding of the ERC requirements and process yourself. This will help you make notified decisions and make sure precise filings.
The Employee 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 retain and pay their staff members throughout the pandemic, even if their operations have actually been affected.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is available to qualified employers, consisting of for-profit companies, tax-exempt companies, and particular governmental entities. To qualify, companies should meet one of two requirements:.
Business operations were totally or partially suspended due to a government order related to COVID-19.
The business experienced a significant decrease in gross receipts. As discussed previously, for 2021, a considerable decline is specified as a 20% decrease in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a substantial decrease is specified as a 20% decrease in gross invoices compared to the same quarter in 2019, or a 20% decline in gross invoices 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 percentage (up to 70%) of qualified incomes paid to workers, consisting of particular health insurance expenditures. 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, businesses that received a Paycheck Protection Program (PPP) loan were not eligible for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 permits organizations to claim the ERC even if they got a PPP loan. The exact same salaries can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively expanded and improved, permitting eligible companies to declare the credit for certified wages paid as far back as March 13, 2020. This retroactive arrangement offers a chance for businesses to modify prior-year tax returns and get refunds.
Declaring the Credit: Employers can claim the ERC by reporting it on their work income tax return, typically Type 941. The excess can be refunded to the employer if the credit goes beyond the quantity of work taxes owed.
It is very important to note that the ERC arrangements and eligibility requirements have evolved over time. The best course of action is to talk to a tax professional or check out the main IRS website for the most updated and comprehensive information relating to the ERC, including any current legal changes or updates.
To get approved for the ERC, a service needs to satisfy one of the following criteria:.
Business operations were totally or partially suspended due to a federal government order related to COVID-19.
The business experienced a considerable decline in gross receipts. For 2021, a significant decrease is defined as a 20% decline in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a significant decrease is specified as a 20% decline in gross receipts compared to the very same quarter in 2019, or a 20% decline in gross invoices compared to the immediately preceding quarter.
The ERC is readily available to services of all sizes, including tax-exempt companies, but there are some exceptions. Federal government entities and businesses that got a PPP loan might have limitations on claiming the credit.
The process for declaring the ERC involves completing the necessary types and including the credit on your employment income tax return (normally Type 941). The exact time it requires to process the credit can vary based upon several elements, including the complexity of your service and the workload of the IRS. It’s recommended to talk to a tax expert for guidance specific to your scenario.
There are a number of business that can assist with the procedure of declaring the ERC. Some widely known companies that use support with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the info provided here is based upon general understanding and may not reflect the most recent updates or changes to the ERC. It is very important to talk to a tax expert or check out the main IRS website for the most precise and current info regarding eligibility, claiming procedures, and available assistance.
Less than 100. The credit is based if the company had 100 or fewer employees on average in 2019.
on salaries paid to all staff members whether they in fact worked or not. To put it simply, even if the.
staff members worked full time and got paid for full time work, the company still gets the credit.
Greater than 100. If the company had more than 100 workers on average in 2019, then the credit is.
enabled only for wages paid to employees who did not work throughout the calendar quarter.
In both cases, “incomes” includes not simply cash payments however likewise a portion of the cost of company.
provided healthcare. What Is The Employee Retention Credit For Employers
Payment.
Companies can be instantly repaid for the credit by decreasing the quantity of payroll taxes they.