Lets talk first about Whats Employee Retention Credit :
Our team here what do these men doing everyone in this room is assisting teach individuals about ERC and uh always supply a gorgeous breakfast and have individuals really learn more about the program we must head to the space where we have the ability to display some of the checks that we are getting for companies and I ‘d like to see that what is this this is uh numerous millions of dollars actually Kevin hundreds of millions of dollars so these are replicate copies of the letters that go to customers validating that the check is on the way I mean you know if you just start to 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 imply it’s just I imply think of how many 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 validated and the check is on the mail in the mail from the internal revenue service heading to the consumer 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 which’s when they pay so they don’t pay anything till they actually receive 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 bank account and they can really rely on Wonder trust that the process has been ended up and how many you think you’ve processed considering that you started this we’re about 35 000 of these for
about six billion dollars wow so clearly they understand what they’re doing and that’s what you need you need 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 really important today the worker retention credit which most of you have never heard of I certainly had not become aware of it until really just recently and found out a lot about it due to the fact that this is probably the lowest cost of capital for any small business anywhere
anytime if you have staff members in between five and five hundred so I’ve got the specialist with me this is Josh Fox he’s the founder and CEO of bottom line Principles 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 just phone your bank supervisor and say 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 like this program it’s disappearing very soon you got to find out everything 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 came up with the cares Act and the cares act provided companies three opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly everyone it makes a big difference right there two 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 alright go on sorry I just have to make sure we got that point I imply that’s a huge difference a loan versus money cash I like cash cash that’s what we’re speaking 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 gorgeous difficult check in the mail where you get real cash from the internal revenue service all right so let’s talk about how it works since it seems like to me if it’s a if it’s employee retention credit that person needed to be a staff member so I’m going to make the Presumption this cash is not for the owner not for individuals on the cap table not for shareholders it’s for staff members right you needed to have actually owned a service however it’s based on you having W-2 workers in America not 10.99. so as long as you had W-2 employees and you paid federal payroll taxes that’s why you would be qualified 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 walk us through the six quarters so you had quarters two three and four 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 throughout that period now let’s talk my preferred part cash just how much can you get back per employee that was on a W-2 in those 6 quarters so the computation in 2020 to be exact Kevin is 50 of the staff member’s salary to an optimum of 5 thousand dollars per employee 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 happen um they just altered the rules in.
2021 versus due to the fact that the turmoil 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 up to five thousand Max and then what occurs 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 employee that is because that’s a lot of cash it is now there’s a caution here the PPP cash would have to be lowered 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 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 internal revenue service so it’s substantial clearly now the big concern is why does no one know about this since appearance when I first became aware of this when I initially fulfilled Josh you know I’ve got lots of investments in lots of companies I’m a major advocate for entrepreneurship in America and make numerous many investments in entrepreneurs of which numerous suffered through the pandemic when I first became aware of this I called BS I do not believe it because 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 been worthy of and we used them wisely to stay alive during the pandemic so when I became aware of this I said nah it can’t be true however when I dug around I even contacted us to my politician buddies Governor Senators they didn’t understand about it I indicate that’s how you know that’s how misinformation is that there’s no details out there then a bunch of people informed me well you can’t get it because you took the PPP also not real so let’s ask Josh why does no one learn about the worker retention credit you understand what’s fascinating you’re talking about the banks Kevin due to the fact that in the PPP loan process 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 huge banks in our country and they would process procedure in Canada a pre-pp loan there’s no loans in Canada by the way it’s simply procedure process that’s all um and here there was chaos since keep in mind in the initial cares act you could not do both programs so if you had done PPP you could refrain from doing ERC in the initial program and when they altered the law in 2021 the banks were refraining from doing ERC since it’s not alone so you’re getting a tax refund so the government never ever made it clear to anyone about how to.
do this does your CFO understand how to do this not really she or he’s never ever done it in the past 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 business your accounting professional no your accounting professional’s never ever done this prior to unless you have an account that went into this service and bottom line my company Kevin has been in business considering that 2009 and we’ve been working with the federal government and the state federal government to recuperate cash for Fortune 500 Fortune 1000 business so a lot of our big big business clients have worked with bottom line to recover other federal government programs we’ve done sales tax and use tax joblessness tax work chance 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 developed to encourage.
employers to keep workers 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, company whose service is totally or partially suspended.
decrease by more than 50%.
1. The credit is offered to all employers despite size consisting of tax exempt companies. There are.
only two exceptions: (1) state and city governments and their instrumentalities and (2) small.
organizations who take Small Business Loans.
2. To qualify, the company needs to meet one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the employer’s business is completely or partly suspended by government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross receipts are below 50% of the similar quarter in 2019. When the.
employer’s gross receipts go above 80% of a similar quarter in 2019 they no longer certify.
after the end of that quarter.
Estimation of the Credit.
The amount of the credit is 50% of the certifying wages paid up to $10,000 in total.
It is effective for salaries paid after March 13th and before December 31, 2020.
The definition of certifying salaries differs by whether an employer had, typically, basically than.
100 employees in 2019.
Business that focus on ERC filing help generally offer expertise and assistance to assist businesses navigate the complex process of claiming the credit. They can provide numerous services, including:.
How is the employee retention credit calculated? Whats Employee Retention Credit
Eligibility Evaluation: These business will assess your company’s eligibility for the ERC based upon aspects such as your industry, profits, and operations. They can help determine if you satisfy the requirements for the credit and determine the maximum credit amount you can declare.
Paperwork and Calculation: ERC filing services will assist in collecting the essential documentation, such as payroll records and monetary declarations, to support your claim. They will also assist determine the credit quantity based on qualified incomes and other certifying expenditures.
Retroactive Claim Evaluation: If you are eligible to declare the ERC for previous quarters, these companies can examine your past payroll records and financials to determine possible chances for retroactive credits. They can assist you amend previous tax returns to claim these refunds.
Filing Help: Companies specializing in ERC filings will prepare and send the required kinds and documents in your place. This consists of finishing Kind 941 or any other necessary tax return.
Compliance and Updates: ERC regulations and assistance have developed over time. These business remain updated with the current modifications and guarantee that your filings abide by the most current standards. If the IRS requests additional details or conducts an audit related to your ERC claim, they can likewise offer continuous support.
It is very important to research study and veterinarian any business using ERC filing assistance to ensure their credibility and proficiency. Search for recognized firms with experience in tax and payroll services, or think about connecting to trusted accounting firms or tax professionals who offer ERC submitting assistance.
Bear in mind that while these business can provide valuable support, it’s constantly a great idea to have a basic understanding of the ERC requirements and process yourself. This will help you make notified choices and ensure 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 steps. The objective of the ERC is to encourage organizations to maintain and pay their employees throughout the pandemic, even if their operations have been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is offered to qualified companies, consisting of for-profit organizations, tax-exempt companies, and certain governmental entities. To certify, employers must fulfill one of two requirements:.
Business operations were fully or partially suspended due to a government order related to COVID-19.
Business experienced a significant decrease in gross receipts. As pointed out previously, for 2021, a substantial decline 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 specified as a 20% decline in gross invoices compared to the very same quarter in 2019, or a 20% decline in gross receipts compared to the immediately 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 portion (approximately 70%) of qualified earnings paid to employees, including particular health insurance 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: At first, businesses that got a Paycheck Security Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 allows companies to declare the ERC even if they received a PPP loan. However, the same incomes can not be utilized to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively broadened and enhanced, permitting qualified companies to declare the credit for certified earnings paid as far back as March 13, 2020. This retroactive provision offers a chance for organizations to modify prior-year income tax return and receive refunds.
Claiming the Credit: Companies can claim the ERC by reporting it on their employment income tax return, typically Kind 941. The excess can be refunded to the employer if the credit surpasses the amount of work taxes owed.
It is very important to note that the ERC arrangements and eligibility criteria have actually evolved with time. The best course of action is to talk to a tax professional or check out the official IRS site for the most detailed and updated info relating to the ERC, including any recent legal changes or updates.
To qualify for the ERC, a business needs to meet one of the following requirements:.
Business operations were totally or partially suspended due to a government order related to COVID-19.
Business experienced a substantial decrease in gross invoices. For 2021, a substantial decline is specified as a 20% decline in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a substantial decline is specified as a 20% decline in gross invoices compared to the very same quarter in 2019, or a 20% decline in gross receipts compared to the right away preceding quarter.
The ERC is available to organizations of all sizes, consisting of tax-exempt companies, however there are some exceptions. Government entities and businesses that got a PPP loan might have constraints on claiming the credit.
The process for declaring the ERC involves completing the required types and including the credit on your work income tax return (generally Kind 941). The exact time it requires to process the credit can vary based upon numerous factors, consisting of the intricacy of your service and the workload of the internal revenue service. It’s recommended to talk to a tax professional for guidance particular to your circumstance.
There are several business that can assist with the procedure of claiming the ERC. These consist of accounting firms, tax advisory services, and payroll provider. Some popular business that offer assistance with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s advisable to research and call these companies straight to ask about their costs and services.
Please note that the details provided here is based on basic knowledge and may not reflect the most current updates or modifications to the ERC. It is necessary to talk to a tax expert or check out the official IRS website for the most precise and current info concerning eligibility, claiming treatments, and offered assistance.
Less than 100. If the company had 100 or fewer workers on average in 2019, then the credit is based.
on earnings paid to all staff members whether they really 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 employer had more than 100 staff members typically in 2019, then the credit is.
permitted just for salaries paid to staff members who did not work throughout the calendar quarter.
In both cases, “incomes” includes not simply money payments but also a part of the expense of company.
supplied healthcare. Whats Employee Retention Credit
Companies can be instantly repaid for the credit by lowering the quantity of payroll taxes they.