Lets talk first about What Is The Non Refundable Portion Of Employee Retention Credit :
Our group here what do these people doing everyone in this room is helping teach individuals about ERC and uh constantly provide a stunning breakfast and have individuals truly find out about the program we should head to the space where we have the ability to show a few 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 literally Kevin numerous millions of dollars so these are replicate copies of the letters that go to customers verifying that the check is on the way I indicate you understand if you just start 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 simply I imply think of the number of real clients that went through the program yeah this is the very end this is the celebration at the end when the check is validated 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
get this you know the check is chosen sure and that’s when they pay so they do not pay anything until they really get the money they don’t pay bottom line Wonder trust anything till this letter is verified the check is on the way they deposit it into their savings account and they can genuinely trust Wonder trust that the process has been completed and how many you believe you have actually processed given that you began 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 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 Wonderful here you’re at my YouTube channel we’re discussing something truly crucial today the employee retention credit which the majority of you have actually never become aware of I certainly hadn’t heard of it up until really just recently and discovered a lot about it since this is probably the lowest cost of capital for any small company anywhere
anytime if you have staff members in between five and five hundred so I have actually got the professional with me this is Josh Fox he’s the founder and CEO of bottom line Ideas 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 simply phone your bank manager and say offer me a loan it does not 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’ve become yes the Ambassador and paid representative for this I love this program it’s disappearing very soon you got to find out everything about it let’s talk worker 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 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 huge difference right there 2 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 alright go on sorry I just need to ensure we got that point I mean that’s a huge difference a loan versus cash money I like cash cash 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 hard check in the mail where you get real money from the internal revenue service all right so let’s talk about how it works since it sounds like to me if it’s a if it’s worker retention credit that individual needed to be an employee so I’m going to make the Assumption this cash is not for the owner not for people 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 workers in America not 10.99. so as long as you had W-2 staff members and you paid federal payroll taxes that’s why you would be eligible so you need 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 correct so there were 6 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 3 of 2021. fine so that’s how it’s determined you have to be on the W-2 throughout that period now let’s talk my preferred part cash just how much can you return per worker that was on a W-2 in those six quarters so the computation in 2020 to be specific Kevin is 50 of the worker’s wage to an optimum of five thousand dollars per worker for the year of 2020 and in 2021 the numbers escalated to 70 of the staff member’s wage to an optimum of seven thousand per quarter how did that take place um they just altered the rules in.
2021 versus due to the fact that the turmoil of the pandemic so they wanted 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 five thousand Max and after that what occurs 21 000 Max in 2021 oh that’s how you create twenty 6 thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty 6 thousand dollars per worker that is because that’s a lot of cash it is now there’s a caveat here the PPP cash would need to be minimized from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan 2 you would reduce the 26 000 so what we’re seeing on average Kevin is if you took PPP cash someplace 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 employees 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 question is why does no one understand about this because appearance when I initially heard about this when I first satisfied Josh you know I have actually got lots of investments in lots of business I’m a major supporter for entrepreneurship in America and make many numerous investments in entrepreneurs of which many suffered through the pandemic when I initially found out about this I called BS I don’t think it due to the fact that 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 which were well been worthy of and we used them carefully to stay alive during the pandemic so when I heard about this I stated nah it can’t be true but when I dug around I even contacted us to my political leader buddies Governor 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 because you took the PPP likewise not true so let’s ask Josh why does no one learn about the employee retention credit you understand what’s interesting you’re discussing the banks Kevin because 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 country and they would process process 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 keep in mind in the initial 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 not doing ERC since it’s not alone so you’re getting a tax refund so the federal 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 previously 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 business your accountant no your accounting professional’s never done this before unless you have an account that went into this company and bottom line my firm Kevin has stayed in business since 2009 and we have actually been dealing with the federal government and the state government to recuperate cash for Fortune 500 Fortune 1000 companies so a lot of our huge big business customers have worked with bottom line to recover other federal government programs we have actually done sales tax and use tax unemployment tax work chance tax credits research and development tax credits unclaimed property real estate 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 staff members on their payroll. The credit is 50% of as much as $10,000 in earnings paid by an.
Since of COVID-19 or whose gross receipts, employer whose organization is totally or partially suspended.
decline by more than 50%.
1. The credit is available to all companies regardless of size including tax exempt companies. There are.
just 2 exceptions: (1) state and city governments and their instrumentalities and (2) little.
organizations who take Small Business Loans.
2. To certify, the company needs to satisfy one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the employer’s service is completely or partially suspended by government order due to COVID-19.
during the calendar quarter or.
o the company’s gross invoices are below 50% of the equivalent quarter in 2019. Once the.
company’s gross receipts go above 80% of a similar 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 certifying earnings paid up to $10,000 in total.
It is effective for wages paid after March 13th and before December 31, 2020.
The meaning of qualifying wages differs by whether a company had, typically, basically than.
100 employees in 2019.
Business that focus on ERC filing assistance usually offer competence and support to help organizations browse the intricate procedure of declaring the credit. They can offer numerous services, including:.
How is the employee retention credit calculated? What Is The Non Refundable Portion Of Employee Retention Credit
Eligibility Evaluation: These companies will evaluate your business’s eligibility for the ERC based on factors such as your market, earnings, and operations. They can help identify if you meet the requirements for the credit and recognize the optimum credit quantity you can claim.
Documentation and Estimation: ERC filing services will help in gathering the necessary paperwork, such as payroll records and financial statements, to support your claim. They will also help compute the credit quantity based upon qualified wages and other qualifying expenses.
Retroactive Claim Evaluation: If you are qualified to claim the ERC for previous quarters, these business can review your previous payroll records and financials to identify potential chances for retroactive credits. They can help you change prior tax returns to declare these refunds.
Filing Help: Companies focusing on ERC filings will prepare and send the needed kinds and paperwork in your place. This consists of completing Kind 941 or any other necessary tax return.
Compliance and Updates: ERC policies and assistance have progressed in time. These companies remain updated with the most recent changes and guarantee that your filings abide by the most existing standards. They can likewise supply ongoing assistance if the internal revenue service demands extra details or performs an audit related to your ERC claim.
It is very important to research study and vet any business using ERC filing support to guarantee their credibility and know-how. Search for established firms with experience in tax and payroll services, or think about connecting to relied on accounting firms or tax experts who use ERC filing assistance.
Remember that while these companies can supply valuable support, it’s always a great idea to have a basic understanding of the ERC requirements and procedure yourself. This will help you make informed decisions and ensure precise 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 objective of the ERC is to motivate businesses to retain and pay their workers throughout the pandemic, even if their operations have actually been affected.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is readily available to eligible employers, consisting of for-profit services, tax-exempt companies, and certain governmental entities. To certify, employers must meet one of two criteria:.
The business operations were totally or partially suspended due to a federal government order related to COVID-19.
The business experienced a considerable decrease in gross receipts. As discussed previously, for 2021, a substantial decrease is defined as a 20% decrease in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a significant decline is defined as a 20% decline in gross receipts compared to the same quarter in 2019, or a 20% decline in gross invoices compared to the right away preceding quarter.
Credit Amount: The ERC is a refundable tax credit that offsets the employer’s share of Social Security taxes. The credit quantity amounts to a percentage (as much as 70%) of certified salaries paid to staff members, including certain health plan costs. The optimum credit per worker is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: At first, organizations that received an Income Protection Program (PPP) loan were not eligible for the ERC. However, legislation passed in late 2020 and extended in 2021 allows businesses to claim the ERC even if they received a PPP loan. The exact same salaries can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has actually been retroactively broadened and enhanced, enabling eligible employers to claim the credit for certified salaries paid as far back as March 13, 2020. This retroactive arrangement provides a chance for companies to change prior-year income tax return and get refunds.
Claiming the Credit: Companies can claim the ERC by reporting it on their employment income tax return, typically Type 941. The excess can be reimbursed to the company if the credit goes beyond the amount of work taxes owed.
It is very important to keep in mind that the ERC arrangements and eligibility requirements have evolved gradually. The very best strategy is to talk to a tax expert or visit the official internal revenue service site for the most current and in-depth information relating to the ERC, including any current legislative modifications or updates.
To receive the ERC, a service must satisfy one of the following requirements:.
The business operations were completely or partly suspended due to a government order related to COVID-19.
Business experienced a considerable decline in gross invoices. For 2021, a substantial decrease is defined as a 20% decline in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a considerable decrease is specified as a 20% decrease in gross receipts compared to the same quarter in 2019, or a 20% decrease in gross invoices compared to the right away preceding quarter.
The ERC is readily available to businesses of all sizes, consisting of tax-exempt companies, but there are some exceptions. Government entities and organizations that received a PPP loan might have limitations on claiming the credit.
The process for declaring the ERC involves completing the necessary kinds and consisting of the credit on your employment income tax return (typically Form 941). The exact time it requires to process the credit can differ based on a number of aspects, including the complexity of your organization and the workload of the internal revenue service. It’s recommended to speak with a tax expert for guidance particular to your situation.
There are several business that can assist with the process of claiming the ERC. These consist of accounting companies, tax advisory services, and payroll service providers. Some well-known companies that provide assistance with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s a good idea to research and call these business straight to ask about their fees and services.
Please keep in mind that the info offered here is based upon general knowledge and might not show the most recent updates or changes to the ERC. It is necessary to seek advice from a tax professional or go to the main IRS site for the most up-to-date and accurate details relating to eligibility, declaring treatments, and offered support.
Less than 100. The credit is based if the employer had 100 or less staff members on average in 2019.
on incomes paid to all staff members whether they really worked or not. Simply put, even if the.
staff members worked full time and got paid for full-time work, the employer still gets the credit.
Greater than 100. The credit is if the company had more than 100 staff members on average in 2019.
permitted just for earnings paid to workers who did not work throughout the calendar quarter.
In both cases, “salaries” includes not just money payments however also a portion of the expense of company.
supplied healthcare. What Is The Non Refundable Portion Of Employee Retention Credit
Employers can be immediately compensated for the credit by lowering the quantity of payroll taxes they.