Lets talk first about Am I Eligible For The Employee Retention Credit :
Our team here what do these guys doing everybody in this space is assisting teach individuals about ERC and uh always provide a stunning breakfast and have people really learn more about the program we must head to the room where we are able to show some of the checks that we are getting for business and I want to see that what is this this is uh hundreds of countless dollars literally Kevin hundreds of countless dollars so these are duplicate copies of the letters that go to customers confirming that the check is on the way I mean you know if you just begin 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 suggest it’s simply I imply 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 verified the numbers are verified and the check is on the mail in the mail from the IRS heading to the consumer so that’s how you have the ability to track it you know when you
receive this you understand the check is gone for sure which’s when they pay so they do not pay anything until they in fact get the cash they do not pay bottom line Wonder trust anything till this letter is validated the check is on the way they deposit it into their checking account and they can genuinely trust Wonder trust that the procedure has actually been finished and the number of you believe you’ve processed because you began this we’re about 35 000 of these for
about six billion dollars wow so clearly they know what they’re doing and that’s what you need you need professionals 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 discussing something really important today the employee retention credit which the majority of you have actually never ever heard of I certainly had not become aware of it till extremely just recently and found out a lot about it since this is most likely the most affordable expense of capital for any small company anywhere
anytime if you have employees between 5 and five hundred so I have actually got the specialist with me this is Josh Fox he’s the creator and CEO of bottom line Concepts 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 state provide 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 have actually become yes the Ambassador and paid spokesperson for this I like this program it’s disappearing very soon you got to learn all about it let’s talk worker retention credit Josh Fox what is an ERC let’s just begin there so during the Trump Administration when President Trump was enacted they came up with the cares Act and the cares act offered services 3 opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically everybody it makes a big distinction right there 2 of them are loans and one’s a refund exactly so the ERC is a refund that’s.
remedy the cash cash payroll tax refund okay go on sorry I simply need to ensure we got that point I indicate that’s a big difference a loan versus cash money I like cash money that’s what we’re talking 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 gorgeous hard check in the mail where you get actual cash from the IRS all right so let’s talk about how it works since it sounds like to me if it’s a if it’s employee retention credit that individual had to be an employee so I’m going to make the Presumption 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 service however it’s based on you having W-2 staff members 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 eligible so you have to be on payroll in 2020 on the W-2 and you have to be on payroll for the very first 6 months of 2021 on the W-2 proper so there were 6 quarters the program was open well stroll us through the six quarters so you had quarters two three and 4 of 2020 and you had quarters one two and 3 of 2021. all right so that’s how it’s measured you need to be on the W-2 during that duration now let’s talk my favorite part cash just how much can you return per employee that was on a W-2 in those six quarters so the estimation in 2020 to be specific Kevin is 50 of the staff member’s income to an optimum of 5 thousand dollars per employee for the year of 2020 and in 2021 the numbers increased to 70 of the staff member’s wage to a maximum of seven thousand per quarter how did that happen um they simply altered the rules in.
2021 versus due to the fact that the chaos 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 five thousand Max and then what occurs 21 000 Max in 2021 oh that’s how you come up with twenty 6 thousand twenty one thousand to twenty twenty one plus five thousand in twenty twenty that’s twenty 6 thousand dollars per worker that is because that’s a lot of money it is now there’s a caution here the PPP cash would need to be reduced from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan 2 you would lower the 26 000 so what we’re seeing on average Kevin is if you took PPP money someplace around ten thousand dollars a person so let’s state 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 obviously now the big question is why does nobody understand about this due to the fact that appearance when I initially found out about this when I first satisfied Josh you know I have actually got lots of investments in lots of companies I’m a significant supporter for entrepreneurship in America and make many lots of financial investments in business owners of which numerous suffered through the pandemic when I first became aware of this I called BS I don’t think it since I utilize 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 deserved and we utilized them carefully to stay alive during the pandemic so when I heard about this I said nah it can’t be true however when I dug around I even called to my political leader pals Guv Senators they didn’t know about it I mean that’s how you know that’s how false information is that there’s no info out there then a bunch of people informed me well you can’t get it due to the fact that you took the PPP likewise not true so let’s ask Josh why does nobody understand about the employee retention credit you understand what’s fascinating you’re discussing the banks Kevin since in the PPP loan process the federal government made it really clear that if you wanted a PPP loan you would call Wells Fargo Citibank Bank of America any of the huge banks in our nation and they would process process in Canada a pre-pp loan there’s no loans in Canada by the way it’s simply process procedure that’s all um and here there was chaos due to the fact that keep in mind in the original cares act you might refrain from doing both programs so if you had done PPP you might not do ERC in the initial program and when they altered 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 government never made it clear to any person about how to.
do this does your CFO know how to do this not actually she or he’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 company your accountant no your accountant’s never ever done this prior to unless you have an account that entered into this organization and bottom line my company Kevin has actually stayed in business considering that 2009 and we have actually been dealing with the federal government and the state federal government to recuperate cash for Fortune 500 Fortune 1000 business so a great deal of our big huge business customers have worked with bottom line to recover other government programs we have actually done sales tax and utilize tax joblessness tax work chance tax credits research and development tax credits unclaimed home property tax all of these other government programs.
The staff member retention tax credit is a broad based refundable tax credit created 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.
Because of COVID-19 or whose gross invoices, employer whose business is fully or partially suspended.
decrease by more than 50%.
1. The credit is offered to all companies no matter size consisting of tax exempt organizations. There are.
just 2 exceptions: (1) state and city governments and their instrumentalities and (2) small.
services who take Small company Loans.
2. To qualify, the employer has to fulfill one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the employer’s service is fully or partially suspended by federal government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross receipts are below 50% of the comparable quarter in 2019. As soon as the.
company’s gross receipts exceed 80% of a similar quarter in 2019 they no longer qualify.
after the end of that quarter.
Estimation of the Credit.
The amount of the credit is 50% of the qualifying earnings paid up to $10,000 in total.
It is effective for salaries paid after March 13th and before December 31, 2020.
The definition of qualifying salaries varies by whether an employer had, typically, more or less than.
100 workers in 2019.
Business that specialize in ERC filing support usually provide expertise and assistance to help organizations navigate the intricate procedure of declaring the credit. They can offer numerous services, consisting of:.
How is the employee retention credit calculated? Am I Eligible For The Employee Retention Credit
Eligibility Assessment: These business will evaluate your organization’s eligibility for the ERC based upon aspects such as your industry, revenue, and operations. They can help figure out if you satisfy the requirements for the credit and identify the maximum credit amount you can claim.
Paperwork and Calculation: ERC filing services will help in gathering the required documents, such as payroll records and monetary statements, to support your claim. They will likewise assist compute the credit quantity based on qualified wages and other qualifying costs.
Retroactive Claim Review: If you are eligible to claim the ERC for prior quarters, these companies can evaluate your previous payroll records and financials to determine prospective opportunities for retroactive credits. They can assist you modify prior income tax return to declare these refunds.
Filing Support: Business focusing on ERC filings will prepare and send the needed kinds and documents in your place. This includes finishing Form 941 or any other required tax forms.
Compliance and Updates: ERC policies and assistance have actually developed in time. These business stay updated with the most recent changes and ensure that your filings adhere to the most present guidelines. If the Internal revenue service demands extra information or carries out an audit associated to your ERC claim, they can also provide continuous assistance.
It is very important to research study and vet any business providing ERC filing support to ensure their trustworthiness and expertise. Search for recognized companies with experience in tax and payroll services, or consider reaching out to relied on accounting companies or tax specialists who use ERC filing assistance.
Keep in mind that while these business can offer valuable assistance, it’s always an excellent concept to have a standard understanding of the ERC requirements and process yourself. This will help you make informed choices and ensure accurate filings.
The Worker 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 encourage companies to maintain and pay their workers throughout the pandemic, even if their operations have actually been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is offered to eligible companies, consisting of for-profit services, tax-exempt companies, and specific governmental entities. To certify, employers need to satisfy one of two criteria:.
Business operations were fully or partially suspended due to a federal government order related to COVID-19.
The business experienced a substantial decline in gross invoices. As mentioned earlier, for 2021, a significant decline is defined as a 20% decrease 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 exact same quarter in 2019, or a 20% decrease 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 amount amounts to a portion (as much as 70%) of qualified incomes paid to workers, including specific health insurance expenditures. The optimum credit per staff member is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: At first, businesses that received an Income Protection Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 enables services to claim the ERC even if they received a PPP loan. The exact same earnings can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively broadened and improved, enabling qualified employers to claim the credit for qualified wages paid as far back as March 13, 2020. This retroactive provision supplies an opportunity for services to modify prior-year tax returns and receive refunds.
Claiming the Credit: Employers can claim the ERC by reporting it on their work tax returns, generally Form 941. The excess can be reimbursed to the employer if the credit surpasses the amount of work taxes owed.
It’s important to keep in mind that the ERC arrangements and eligibility criteria have actually progressed over time. The very best course of action is to speak with a tax professional or visit the official internal revenue service site for the most updated and detailed info concerning the ERC, consisting of any current legal changes or updates.
To receive the ERC, a service needs to satisfy one of the following requirements:.
Business operations were totally or partially suspended due to a government order related to COVID-19.
Business experienced a significant decline in gross invoices. For 2021, a substantial decline is defined as a 20% decline in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a substantial decline is specified as a 20% decline in gross invoices compared to the exact same quarter in 2019, or a 20% decline in gross receipts compared to the immediately preceding quarter.
The ERC is offered to companies of all sizes, including tax-exempt companies, however there are some exceptions. Federal government entities and companies that got a PPP loan might have restrictions on declaring the credit.
The process for claiming the ERC includes completing the necessary kinds and consisting of the credit on your work income tax return (usually Type 941). The exact time it takes to process the credit can differ based upon several factors, including the intricacy of your organization and the work of the internal revenue service. It’s recommended to talk to a tax expert for assistance particular to your scenario.
There are numerous business that can aid with the procedure of claiming the ERC. These include accounting firms, tax advisory services, and payroll company. Some widely known business that use help with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s suggested to research and call these companies directly to ask about their services and costs.
Please note that the details supplied here is based on general knowledge and may not reflect the most current updates or modifications to the ERC. It is necessary to seek advice from a tax expert or go to the official internal revenue service website for the most updated and accurate information relating to eligibility, declaring treatments, and readily available support.
Less than 100. The credit is based if the employer had 100 or fewer staff members on average in 2019.
on wages 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 company still gets the credit.
Greater than 100. If the company had more than 100 workers typically in 2019, then the credit is.
allowed only for wages paid to employees who did not work during the calendar quarter.
In both cases, “incomes” includes not just cash payments but likewise a portion of the cost of company.
supplied health care. Am I Eligible For The Employee Retention Credit
Employers can be instantly reimbursed for the credit by minimizing the amount of payroll taxes they.