Lets talk first about Aggregation Employee Retention Credit :
Our team here what do these guys doing everyone in this room is helping teach individuals about ERC and uh always supply a beautiful breakfast and have individuals actually find out about the program we must head to the space 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 literally Kevin hundreds of millions of dollars so these are duplicate copies of the letters that go to customers confirming that the check is on the method I indicate you know if you just begin to take a look at some 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 consider the number of actual customers that went through the program yeah this is the very end this is the celebration at the end when the check is verified the numbers are validated and the check is on the mail in the mail from the IRS heading to the customer so that’s how you’re able to track it you know when you
receive this you know the check is chosen sure which’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 verified the check is on the way they deposit it into their checking account and they can really rely on Wonder trust that the process has been finished and how many you believe you’ve processed because you began this we have to do with 35 000 of these for
about six billion dollars wow so clearly they know what they’re doing and that’s what you require 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 Fantastic here you’re at my YouTube channel we’re speaking about something truly crucial today the worker retention credit which most of you have never heard of I definitely hadn’t become aware of it till really recently and found out a lot about it since this is probably the most affordable cost of capital for any small company anywhere
anytime if you have staff members in between 5 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 hard this isn’t like PPP we simply phone your bank supervisor and say offer 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 ended up being yes the Ambassador and paid representative for this I enjoy this program it’s disappearing soon you got to learn everything about it let’s talk employee 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 provided services 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 huge distinction right there two of them are loans and one’s a refund precisely so the ERC is a refund that’s.
remedy the cash cash payroll tax refund okay go on sorry I simply have to make sure we got that point I mean that’s a big distinction a loan versus cash cash I like money cash that’s what we’re discussing alright 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 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 worker retention credit that person had 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 workers right you needed to have actually owned a business however it’s based on you having W-2 staff members 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 have to be on payroll in 2020 on the W-2 and you need 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 three and four of 2020 and you had quarters one 2 and three of 2021. okay so that’s how it’s determined you need to be on the W-2 during that period now let’s talk my preferred part cash how much can you get back per employee that was on a W-2 in those six quarters so the computation in 2020 to be exact Kevin is 50 of the employee’s wage to an optimum of five thousand dollars per staff member for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the staff member’s salary to an optimum of 7 thousand per quarter how did that take place um they just altered the rules in.
2021 versus because 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 approximately 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 five thousand in twenty twenty that’s twenty 6 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 lowered from the twenty six thousand dollars so if you took PPP loan one and PPP loan 2 you would minimize the 26 000 so what we’re seeing typically Kevin is if you took PPP money somewhere around ten thousand dollars an individual so let’s say hypothetically you owned a restaurant in New york city City where I’m from and you had a hundred employees and you took PPP cash you would still get a million dollar in the mail from the internal revenue service so it’s huge clearly now the big question is why does no one know about this due to the fact that appearance when I first found out about this when I first satisfied Josh you know I have actually got lots of investments in great deals of companies I’m a significant supporter for entrepreneurship in America and make lots of numerous investments in entrepreneurs of which numerous suffered through the pandemic when I first heard about this I called BS I don’t think it due to the fact that I utilize the PPP we went through the cash center Banks to get it it was really easy to do we had our CEOs call the banks they got their loans which were well should have and we utilized them sensibly to stay alive during the pandemic so when I heard about this I stated nah it can’t hold true but when I dug around I even contacted us to my politician friends Guv Senators they didn’t know about it I mean that’s how you understand that’s how false information is that there’s no details out there then a lot of individuals informed me well you can’t get it since you took the PPP likewise not true so let’s ask Josh why does nobody understand 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 process the federal government made it very 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 simply procedure process that’s all um and here there was mayhem since remember in the original cares act you might refrain from doing both programs so if you had actually done PPP you might refrain from doing ERC in the initial 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 made it clear to anybody about how to.
do this does your CFO understand how to do this not actually she or he’s never done it previously do the banks do it nope the banks do not do it the payroll business yeah a few of them are doing it as a payroll business your accountant no your accountant’s never done this before unless you have an account that went into this organization and bottom line my firm Kevin has actually been in business since 2009 and we’ve been dealing with the federal government and the state government to recover money for Fortune 500 Fortune 1000 companies so a great deal of our big big corporate clients have dealt with bottom line to recover other federal government programs we have actually done sales tax and use tax joblessness tax work opportunity tax credits research and development tax credits unclaimed home real estate tax all of these other government programs.
The employee retention tax credit is a broad based refundable tax credit created to motivate.
employers to keep employees on their payroll. The credit is 50% of approximately $10,000 in salaries paid by an.
employer whose organization is totally or partly suspended because of COVID-19 or whose gross invoices.
decline by more than 50%.
1. The credit is readily available to all companies no matter size consisting of tax exempt organizations. There are.
only two exceptions: (1) state and city governments and their instrumentalities and (2) little.
companies who take Small company Loans.
2. To qualify, the employer needs to satisfy one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the company’s organization is fully or partially suspended by government order due to COVID-19.
during the calendar quarter or.
o the employer’s gross invoices are listed below 50% of the similar quarter in 2019. Once the.
company’s gross receipts exceed 80% of an equivalent 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 earnings paid up to $10,000 in overall.
It is effective for earnings paid after March 13th and before December 31, 2020.
The definition of certifying salaries differs by whether a company had, on average, basically than.
100 workers in 2019.
Companies that focus on ERC filing assistance generally offer knowledge and assistance to help services browse the complex procedure of declaring the credit. They can use various services, consisting of:.
How is the employee retention credit calculated? Aggregation Employee Retention Credit
Eligibility Evaluation: These business will assess your organization’s eligibility for the ERC based upon factors such as your industry, revenue, and operations. They can assist figure out if you fulfill the requirements for the credit and determine the maximum credit quantity you can claim.
Documents and Calculation: ERC filing services will help in gathering the needed paperwork, such as payroll records and monetary declarations, to support your claim. They will likewise assist calculate the credit amount based upon qualified incomes and other certifying costs.
Retroactive Claim Review: If you are eligible to declare the ERC for prior quarters, these companies can examine your past payroll records and financials to recognize possible opportunities for retroactive credits. They can help you modify prior tax returns to declare these refunds.
Filing Support: Business focusing on ERC filings will prepare and send the needed forms and documentation in your place. This includes finishing Form 941 or any other necessary tax return.
Compliance and Updates: ERC guidelines and guidance have evolved gradually. These companies remain upgraded with the latest modifications and ensure that your filings comply with the most existing standards. They can likewise supply ongoing support if the internal revenue service demands extra info or carries out an audit related to your ERC claim.
It is very important to research and veterinarian any business offering ERC filing support to guarantee their trustworthiness and expertise. Try to find established firms with experience in tax and payroll services, or think about connecting to trusted accounting firms or tax professionals who use ERC filing assistance.
Keep in mind that while these business can offer important assistance, it’s constantly a good concept to have a standard understanding of the ERC requirements and process yourself. This will help you make notified choices and make sure 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 procedures. The goal of the ERC is to motivate companies to maintain and pay their staff members throughout the pandemic, even if their operations have actually been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is readily available to eligible companies, including for-profit companies, tax-exempt companies, and particular governmental entities. To qualify, employers need to meet one of two requirements:.
Business operations were fully or partly suspended due to a government order related to COVID-19.
Business experienced a significant decline in gross receipts. As pointed out earlier, 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 substantial decrease is defined 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 right away preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit quantity amounts to a percentage (up to 70%) of qualified salaries paid to staff members, consisting of certain health plan 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: At first, organizations that got an Income Protection Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 permits businesses to claim the ERC even if they got a PPP loan. However, the exact same incomes can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively broadened and improved, allowing eligible employers to declare the credit for certified incomes paid as far back as March 13, 2020. This retroactive provision supplies an opportunity for services to modify prior-year income tax return and receive refunds.
Declaring the Credit: Companies can declare the ERC by reporting it on their work tax returns, usually Type 941. The excess can be reimbursed to the employer if the credit exceeds the amount of work taxes owed.
It is very important to keep in mind that the ERC arrangements and eligibility requirements have actually evolved gradually. The best course of action is to speak with a tax expert or check out the official internal revenue service site for the most up-to-date and in-depth details regarding the ERC, consisting of any recent legal changes or updates.
To get approved for the ERC, a company should fulfill one of the following criteria:.
Business operations were completely or partly suspended due to a federal government order related to COVID-19.
Business experienced a significant decrease in gross invoices. For 2021, a significant decline is defined as a 20% decrease in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a considerable decline 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 instantly preceding quarter.
The ERC is available to organizations of all sizes, consisting of tax-exempt companies, but there are some exceptions. For example, federal government entities and services that got a PPP loan might have constraints on declaring the credit.
The procedure for claiming the ERC involves finishing the required forms and consisting of the credit on your work tax return (normally Type 941). The exact time it requires to process the credit can differ based upon several elements, consisting of the intricacy of your business and the work of the internal revenue service. It’s recommended to consult with a tax professional for assistance particular to your circumstance.
There are several business that can assist with the procedure of declaring the ERC. Some widely known business that provide help with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the details provided here is based on general understanding and might not reflect the most current updates or modifications to the ERC. It is very important to consult with a tax professional or visit the official IRS website for the most current and accurate info regarding eligibility, claiming treatments, and readily available support.
Less than 100. If the employer had 100 or fewer workers on average in 2019, then the credit is based.
on salaries paid to all staff members whether they actually worked or not. To put it simply, even if the.
staff members worked full-time and got paid for full time work, the employer still gets the credit.
Greater than 100. If the employer had more than 100 employees on average in 2019, then the credit is.
allowed only for incomes paid to staff members who did not work during the calendar quarter.
In both cases, “incomes” includes not just cash payments however likewise a part of the cost of employer.
provided health care. Aggregation Employee Retention Credit
Companies can be immediately reimbursed for the credit by minimizing the amount of payroll taxes they.