Lets talk first about When Was The Employee Retention Credit Passed :
Our team here what do these people doing everyone in this space is assisting teach people about ERC and uh constantly supply a beautiful breakfast and have individuals truly discover the program we must head to the room where we have the ability to show some of the checks that we are getting for companies and I want to see that what is this this is uh numerous millions of dollars literally Kevin numerous millions of dollars so these are duplicate copies of the letters that go to clients validating that the check is on the way I imply you understand if you simply 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 just I imply consider the number of actual clients that went through the program yeah this is the very end this is the party at the end when the check is validated 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 chosen sure and that’s when they pay so they don’t pay anything up until they in fact get the money they don’t pay bottom line Wonder trust anything until this letter is confirmed 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 actually been ended up and the number of you believe you have actually processed since you started this we’re about 35 000 of these for
about 6 billion dollars wow so clearly they know what they’re doing which’s what you need you require experts 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 talking about something really important today the worker retention credit which most of you have actually never ever become aware of I definitely hadn’t heard of it till really recently and learned a lot about it because this is probably the lowest expense of capital for any small business anywhere
anytime if you have staff members in between 5 and five hundred so I’ve got the professional 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 challenging this isn’t like PPP we just call your bank manager and state give 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 have actually become yes the Ambassador and paid spokesperson for this I like this program it’s disappearing 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 start there so throughout the Trump Administration when President Trump was enacted they came up with the cares Act and the cares act offered companies 3 opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and almost everyone it makes a big distinction right there two of them are loans and one’s a refund precisely so the ERC is a refund that’s.
fix the money money payroll tax refund fine go on sorry I just have to make sure we got that point I imply that’s a big difference a loan versus money cash I like money money 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 stunning hard check in the mail where you get real cash from the internal revenue service all right so let’s speak about how it works because it sounds like to me if it’s a if it’s employee retention credit that individual had to be a worker so I’m going to make the Presumption this money is not for the owner not for people on the cap table not for shareholders it’s for employees right you had to have actually owned a service but it’s based upon you having W-2 employees 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 eligible so you need to be on payroll in 2020 on the W-2 and you have to be on payroll for the very first six months of 2021 on the W-2 appropriate so there were six 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 three of 2021. fine so that’s how it’s measured you have to be on the W-2 throughout that duration 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 six quarters so the calculation in 2020 to be exact Kevin is 50 of the staff member’s income to an optimum of five thousand dollars per staff member for the year of 2020 and in 2021 the numbers escalated to 70 of the worker’s wage to a maximum of seven thousand per quarter how did that happen um they just changed the rules in.
2021 versus due to the fact that the chaos of the pandemic so they wanted to even get more to keep those staff members 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 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 five thousand in twenty twenty that’s twenty 6 thousand dollars per staff member that is because that’s a lot of cash it is now there’s a caution here the PPP money would have to be minimized 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 cash someplace 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 cash you would still get a million dollar in the mail from the IRS so it’s huge clearly now the huge concern is why does no one know about this due to the fact that look when I initially found out about this when I first met Josh you know I have actually got great deals of financial investments in great deals of business I’m a significant advocate for entrepreneurship in America and make many numerous financial investments in business owners of which numerous suffered through the pandemic when I initially became aware of this I called BS I do not believe it since I utilize the PPP we went through the money center Banks to get it it was really 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 carefully to stay alive 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 called to my politician friends Governor Senators they didn’t learn about it I mean 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 since you took the PPP likewise not real so let’s ask Josh why does nobody know about the worker retention credit you know what’s fascinating you’re speaking about the banks Kevin due to the fact that in the PPP loan procedure the federal government made it very clear that if you desired a PPP loan you would call Wells Fargo Citibank Bank of America any of the huge 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 procedure process that’s all um and here there was turmoil since keep in mind in the original cares act you could not do both programs so if you had actually done PPP you could not do ERC in the original program and when they changed the law in 2021 the banks were not doing ERC due to the fact that 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 understand how to do this not really he or she’s never ever done it before 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 accounting professional no your accountant’s never done this prior to unless you have an account that went into this company 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 recuperate cash for Fortune 500 Fortune 1000 companies so a lot of our big huge business clients have worked 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 real estate tax all of these other federal government programs.
The worker retention tax credit is a broad based refundable tax credit created to motivate.
companies to keep staff members on their payroll. The credit is 50% of up to $10,000 in incomes paid by an.
Because of COVID-19 or whose gross receipts, employer whose service is fully or partly suspended.
decline by more than 50%.
1. The credit is offered to all employers despite size consisting of tax exempt organizations. There are.
only two exceptions: (1) state and city governments and their instrumentalities and (2) small.
businesses who take Small company Loans.
2. To certify, the company has to satisfy one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the company’s organization is completely or partly suspended by federal government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross invoices are listed below 50% of the similar quarter in 2019. Once the.
company’s gross receipts exceed 80% of a similar quarter in 2019 they no longer qualify.
after the end of that quarter.
Calculation of the Credit.
The quantity of the credit is 50% of the qualifying incomes paid up to $10,000 in overall.
It is effective for wages paid after March 13th and prior to December 31, 2020.
The definition of certifying wages varies by whether a company had, typically, basically than.
100 employees in 2019.
Business that specialize in ERC filing support usually provide proficiency and assistance to help businesses navigate the complex procedure of claiming the credit. They can provide different services, including:.
How is the employee retention credit calculated? When Was The Employee Retention Credit Passed
Eligibility Evaluation: These business will examine your organization’s eligibility for the ERC based on aspects such as your industry, income, and operations. They can help identify if you meet the requirements for the credit and identify the maximum credit amount you can claim.
Documents and Computation: ERC filing services will help in collecting the necessary documentation, such as payroll records and financial statements, to support your claim. They will likewise help calculate the credit quantity based upon qualified earnings and other certifying expenses.
Retroactive Claim Review: If you are qualified to declare the ERC for prior quarters, these companies can review your previous payroll records and financials to recognize prospective chances for retroactive credits. They can help you modify prior tax returns to declare these refunds.
Filing Support: Business specializing in ERC filings will prepare and submit the required types and documents in your place. This includes completing Kind 941 or any other required tax return.
Compliance and Updates: ERC guidelines and assistance have actually progressed in time. These companies stay upgraded with the latest modifications and guarantee that your filings abide by the most present standards. They can likewise supply continuous support if the IRS requests additional details or conducts an audit related to your ERC claim.
It is essential to research study and vet any company providing ERC filing assistance to guarantee their credibility and proficiency. Search for recognized firms with experience in tax and payroll services, or consider connecting to relied on accounting firms or tax experts who offer ERC filing assistance.
Bear in mind that while these companies can provide valuable help, it’s constantly an excellent concept to have a fundamental understanding of the ERC requirements and process yourself. This will help you make notified decisions and guarantee accurate filings.
The Employee 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 businesses to keep and pay their workers 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 qualified companies, consisting of for-profit businesses, tax-exempt companies, and certain governmental entities. To qualify, companies need to satisfy one of two requirements:.
The business operations were fully or partially suspended due to a government order related to COVID-19.
Business experienced a considerable decline in gross invoices. As discussed previously, for 2021, a significant decrease is defined as a 20% decline in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a significant 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 company’s share of Social Security taxes. The credit amount amounts to a percentage (as much as 70%) of certified wages paid to employees, including specific health insurance costs. The optimum credit per employee is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: At first, businesses that received a Paycheck Protection Program (PPP) loan were not qualified for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 allows businesses to claim the ERC even if they received a PPP loan. However, the same incomes can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has actually been retroactively expanded and improved, enabling qualified companies to claim the credit for qualified wages paid as far back as March 13, 2020. This retroactive provision supplies an opportunity for businesses to change prior-year tax returns and receive refunds.
Claiming the Credit: Companies can claim the ERC by reporting it on their employment income tax return, normally Form 941. If the credit exceeds the quantity of work taxes owed, the excess can be reimbursed to the company.
It’s important to note that the ERC provisions and eligibility requirements have developed over time. The very best strategy is to speak with a tax professional or go to the official IRS site for the most updated and in-depth details concerning the ERC, including any current legal modifications or updates.
To get approved for the ERC, an organization should satisfy one of the following requirements:.
The business operations were fully 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 receipts compared to the same quarter in 2019. For 2022 and beyond, a significant decrease is defined as a 20% decline in gross receipts compared to the same quarter in 2019, or a 20% decrease in gross receipts compared to the immediately preceding quarter.
The ERC is available to businesses of all sizes, consisting of tax-exempt companies, but there are some exceptions. Federal government entities and businesses that received a PPP loan might have limitations on declaring the credit.
The process for declaring the ERC involves completing the required forms and including the credit on your work tax return (generally Type 941). The exact time it takes to process the credit can differ based upon numerous aspects, consisting of the intricacy of your business and the workload of the IRS. It’s recommended to consult with a tax expert for assistance particular to your situation.
There are several business that can help with the process of declaring the ERC. Some well-known business that provide support with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the details provided here is based upon general knowledge and might not reflect the most recent updates or changes to the ERC. It is very important to consult with a tax expert or visit the official internal revenue service site for the most updated and accurate info concerning eligibility, declaring treatments, and offered support.
Less than 100. The credit is based if the company had 100 or less workers on average in 2019.
on salaries paid to all staff members whether they in fact worked or not. Simply put, even if the.
workers worked full-time and got paid for full-time work, the employer still gets the credit.
Greater than 100. The credit is if the employer had more than 100 staff members on average in 2019.
enabled only for earnings paid to workers who did not work during the calendar quarter.
In both cases, “salaries” includes not just cash payments but also a portion of the expense of employer.
provided healthcare. When Was The Employee Retention Credit Passed
Companies can be instantly compensated for the credit by decreasing the amount of payroll taxes they.