Lets talk first about Can An Employee Get Employee Retention Credit :
Our team here what do these men doing everyone in this space is helping teach people about ERC and uh always supply a lovely breakfast and have people truly learn about the program we ought to 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 actually Kevin numerous millions of dollars so these are duplicate copies of the letters that go to clients validating that the check is on the method I indicate you know if you simply 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 indicate it’s simply I suggest consider how many real 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 customer so that’s how you have the ability to track it you understand when you
receive this you understand the check is opted for sure which’s when they pay so they don’t pay anything up until they really receive the money they don’t pay bottom line Wonder trust anything till this letter is confirmed the check is on the method they deposit it into their bank account and they can really rely on Wonder trust that the process has actually been completed and how many you think you’ve processed considering that you began this we have to do with 35 000 of these for
about six billion dollars wow so clearly they understand what they’re doing which’s what you require 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 Wonderful here you’re at my YouTube channel we’re discussing something actually crucial today the staff member retention credit which most of you have never heard of I certainly hadn’t become aware of it up until really recently and learned a lot about it because this is most likely the most affordable cost of capital for any small business anywhere
anytime if you have workers in between 5 and five hundred so I’ve got the expert with me this is Josh Fox he’s the founder and CEO of bottom line Concepts 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 contact your bank manager and say provide 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 representative for this I love this program it’s disappearing very soon you got to learn everything about it let’s talk staff member 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 companies 3 chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly everybody it makes a huge distinction right there 2 of them are loans and one’s a refund precisely so the ERC is a refund that’s.
correct the cash cash payroll tax refund okay go on sorry I just have to make certain we got that point I suggest that’s a big distinction a loan versus money cash 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 initial cares Act is the ERC and yes Kevin it is a lovely hard check in the mail where you get actual 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 an employee so I’m going to make the Assumption this money is not for the owner not for people on the cap table not for investors it’s for workers right you needed to have owned a business but it’s based upon you having W-2 workers in America not 10.99. so as long as you had W-2 workers 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 need to be on payroll for the very first six months of 2021 on the W-2 correct so there were 6 quarters the program was open well walk us through the 6 quarters so you had quarters two 3 and 4 of 2020 and you had quarters one two and three of 2021. all right so that’s how it’s determined you have to be on the W-2 during that period now let’s talk my favorite part money just how much can you return per worker that was on a W-2 in those six quarters so the estimation in 2020 to be precise Kevin is 50 of the staff member’s salary to an optimum of five thousand dollars per worker for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the employee’s income to an optimum of 7 thousand per quarter how did that take place um they just altered the rules in.
2021 versus because the mayhem of the pandemic so they wanted to even get more to keep those employees on payroll 100 so if you can get 5 000 per person Max in twenty that was 50 in 2020 as much as five thousand Max and then what happens 21 000 Max in 2021 oh that’s how you develop twenty 6 thousand twenty one thousand to twenty twenty one plus five thousand in twenty twenty that’s twenty six thousand dollars per worker that is since that’s a lot of cash it is now there’s a caution here the PPP money would need to be reduced from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan two you would decrease the 26 000 so what we’re seeing on average Kevin is if you took PPP cash somewhere around 10 thousand dollars an individual so let’s state hypothetically you owned a restaurant in New York 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 big certainly now the huge question is why does nobody understand about this due to the fact that appearance when I first found out about this when I initially met Josh you understand I have actually got great deals of financial investments in lots of companies I’m a significant supporter for entrepreneurship in America and make many lots of financial investments in entrepreneurs of which numerous suffered through the pandemic when I first became aware of this I called BS I don’t think it because I utilize the PPP we went through the money center Banks to get it it was very easy to do we had our CEOs call the banks they got their loans and that were well should have and we utilized them wisely to survive throughout the pandemic so when I found out about this I stated nah it can’t be true but when I dug around I even contacted us to my political leader buddies Guv Senators they didn’t learn about it I indicate that’s how you understand that’s how misinformation is that there’s no information out there then a lot of individuals informed me well you can’t get it since you took the PPP also not true so let’s ask Josh why does no one know about the staff member retention credit you know what’s interesting you’re discussing the banks Kevin since in the PPP loan process the federal government made it extremely 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 process 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 due to the fact that remember in the initial cares act you might refrain from doing both programs so if you had done PPP you could not do ERC in the original program and when they altered the law in 2021 the banks were refraining from 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 anybody about how to.
do this does your CFO understand how to do this not really 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 company your accountant no your accountant’s never ever done this before unless you have an account that went into this organization and bottom line my firm Kevin has actually stayed 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 dealt with bottom line to recover other 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 government programs.
The employee retention tax credit is a broad based refundable tax credit created to motivate.
companies to keep employees 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 invoices, company whose service is completely or partly suspended.
decline by more than 50%.
1. The credit is available to all employers despite size including tax exempt organizations. There are.
just two exceptions: (1) state and local governments and their instrumentalities and (2) small.
services who take Small Business Loans.
2. To qualify, the company needs to satisfy one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the employer’s business is fully or partially suspended by government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross invoices are listed below 50% of the comparable quarter in 2019. When the.
company’s gross invoices exceed 80% of an equivalent 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 qualifying incomes 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 earnings varies by whether a company had, on average, basically than.
100 employees in 2019.
Companies that specialize in ERC filing help usually offer knowledge and support to help organizations browse the intricate process of claiming the credit. They can use various services, consisting of:.
How is the employee retention credit calculated? Can An Employee Get Employee Retention Credit
Eligibility Evaluation: These business will examine your organization’s eligibility for the ERC based upon elements such as your market, income, and operations. If you fulfill the requirements for the credit and determine the optimum credit quantity you can claim, they can help figure out.
Documents and Calculation: ERC filing services will help in collecting the required documentation, such as payroll records and financial declarations, to support your claim. They will also help calculate the credit amount based on eligible wages and other certifying expenditures.
Retroactive Claim Review: If you are qualified to claim the ERC for previous quarters, these business can review your past payroll records and financials to identify potential opportunities for retroactive credits. They can help you change prior income tax return to declare these refunds.
Filing Assistance: Companies focusing on ERC filings will prepare and send the necessary kinds and documents on your behalf. This includes completing Type 941 or any other required tax forms.
Compliance and Updates: ERC guidelines and assistance have actually progressed gradually. These business remain updated with the current changes and make sure that your filings abide by the most present guidelines. They can also provide ongoing support if the internal revenue service demands extra information or carries out an audit related to your ERC claim.
It is necessary to research and veterinarian any business offering ERC filing assistance to ensure their credibility and competence. Try to find recognized firms with experience in tax and payroll services, or think about reaching out to relied on accounting companies or tax specialists who offer ERC submitting assistance.
Keep in mind that while these business can provide valuable assistance, it’s constantly an excellent concept to have a basic understanding of the ERC requirements and procedure yourself. This will assist you make notified 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 measures. The goal of the ERC is to motivate organizations to keep and pay their employees during the pandemic, even if their operations have actually been impacted.
Here are some key points about the ERC:.
Eligibility: The ERC is readily available to eligible companies, consisting of for-profit services, tax-exempt companies, and particular governmental entities. To certify, employers must meet one of two requirements:.
Business operations were fully or partly suspended due to a federal government order related to COVID-19.
The business experienced a substantial decline in gross invoices. As discussed earlier, for 2021, a substantial decrease is specified as a 20% decline in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a substantial decrease is specified as a 20% decrease in gross invoices compared to the very same quarter in 2019, or a 20% decrease in gross invoices compared to the instantly 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 portion (as much as 70%) of qualified incomes paid to staff members, including certain health insurance expenses. The maximum credit per employee is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, services that received an Income Protection Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 permits companies to claim the ERC even if they received a PPP loan. The very same earnings can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively broadened and boosted, permitting eligible companies to declare the credit for qualified salaries paid as far back as March 13, 2020. This retroactive provision provides an opportunity for companies to amend prior-year income tax return and get refunds.
Declaring the Credit: Companies can claim the ERC by reporting it on their work tax returns, normally Type 941. The excess can be refunded to the company if the credit surpasses the quantity of employment taxes owed.
It is very important to note that the ERC provisions and eligibility criteria have evolved over time. The best course of action is to consult with a tax professional or go to the official IRS website for the most comprehensive and up-to-date info concerning the ERC, including any recent legislative changes or updates.
To get approved for the ERC, a service needs to fulfill one of the following criteria:.
The business operations were totally or partly 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 specified as a 20% decline in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a considerable 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 readily available to companies of all sizes, consisting of tax-exempt companies, but there are some exceptions. Federal government entities and businesses that got a PPP loan may have limitations on claiming the credit.
The procedure for declaring the ERC involves completing the essential kinds and including the credit on your employment income tax return (generally Type 941). The exact time it requires to process the credit can vary based on numerous elements, including the intricacy of your company and the workload of the internal revenue service. It’s recommended to speak with a tax expert for assistance particular to your situation.
There are a number of business that can assist with the procedure of declaring the ERC. Some popular business that offer support with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the details offered here is based on general knowledge and may not reflect the most recent updates or modifications to the ERC. It is essential to talk to a tax professional or go to the main IRS website for the most up-to-date and precise info regarding eligibility, claiming treatments, and offered assistance.
Less than 100. The credit is based if the employer had 100 or less employees on average in 2019.
on incomes paid to all employees whether they in fact worked or not. In other words, 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 workers typically in 2019, then the credit is.
enabled only for earnings paid to staff members who did not work throughout the calendar quarter.
In both cases, “wages” includes not just cash payments but likewise a portion of the expense of employer.
supplied healthcare. Can An Employee Get Employee Retention Credit
Employers can be immediately compensated for the credit by decreasing the quantity of payroll taxes they.