Lets talk first about Deadline To Apply For Employee Retention Credit 2021 :
Our group here what do these guys doing everybody in this room is helping teach people about ERC and uh constantly provide a lovely breakfast and have individuals actually learn about the program we need to head to the space where we are able to display a few of the checks that we are getting for business and I ‘d like to see that what is this this is uh hundreds of countless dollars actually Kevin numerous countless dollars so these are replicate copies of the letters that go to customers verifying that the check is on the method I suggest you know if you just begin to look at some of these here I suggest 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 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 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 know when you
receive this you understand the check is chosen sure which’s when they pay so they do not pay anything up until they in fact get the money they do not pay bottom line Wonder trust anything up until this letter is validated the check is on the method they transfer it into their savings account and they can really rely on Wonder trust that the procedure has been ended up and how many you think you’ve processed because you began this we have to do with 35 000 of these for
about 6 billion dollars wow so clearly they understand what they’re doing and that’s what you need you need 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 Fantastic here you’re at my YouTube channel we’re speaking about something truly crucial today the staff member retention credit which the majority of you have actually never ever become aware of I definitely 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 company anywhere
anytime if you have workers in between five and five hundred so I have actually got the professional with me this is Josh Fox he’s the creator and CEO of bottom line Principles they’re the biggest 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 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 all of us about it and how to get it and why I have actually ended up being yes the Ambassador and paid spokesperson for this I love this program it’s going away soon you got to learn all about it let’s talk staff member 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 offered companies three chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and almost everybody it makes a huge distinction right there two of them are loans and one’s a refund exactly so the ERC is a refund that’s.
fix the money cash payroll tax refund fine go on sorry I simply need to make certain we got that point I indicate that’s a big difference a loan versus money money I like money money that’s what we’re discussing 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 stunning tough check in the mail where you get actual cash from the internal revenue service all right so let’s discuss how it works due to the fact that it seems like to me if it’s a if it’s employee retention credit that person had to be an employee so I’m going to make the Presumption this money is not for the owner not for people on the cap table not for investors it’s for employees right you had to have actually owned a company however it’s based on you having W-2 employees 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 first 6 months of 2021 on the W-2 right so there were 6 quarters the program was open well stroll us through the six quarters so you had quarters two 3 and 4 of 2020 and you had quarters one two and 3 of 2021. alright so that’s how it’s determined you have to be on the W-2 throughout that duration 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 calculation in 2020 to be exact Kevin is 50 of the staff member’s wage to an optimum of 5 thousand dollars per employee for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the staff member’s salary to a maximum of seven thousand per quarter how did that happen um they just altered the rules in.
2021 versus because 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 5 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 5 thousand in twenty twenty that’s twenty six thousand dollars per worker that is since that’s a great deal 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 2 you would lower the 26 000 so what we’re seeing on average Kevin is if you took PPP cash somewhere around 10 thousand dollars a person so let’s state hypothetically you owned a restaurant in New York City where I’m from and you had a hundred workers and you took PPP money you would still get a million dollar in the mail from the IRS so it’s huge obviously now the huge question is why does nobody understand about this because look when I first heard about this when I initially satisfied Josh you understand I have actually got lots of financial investments in lots of companies I’m a major advocate for entrepreneurship in America and make numerous numerous investments in business owners of which numerous suffered through the pandemic when I first found out about this I called BS I don’t think it since I use the PPP we went through the money 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 should have and we utilized them wisely to stay alive during the pandemic so when I heard about this I stated nah it can’t be true but when I dug around I even called to my political leader friends Governor Senators they didn’t know 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 told me well you can’t get it due to the fact that you took the PPP also not true so let’s ask Josh why does nobody learn about the staff member retention credit you know what’s fascinating you’re discussing the banks Kevin because in the PPP loan procedure 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 country and they would process process in Canada a pre-pp loan there’s no loans in Canada by the way it’s just procedure process that’s all um and here there was mayhem because keep in mind in the original cares act you could not do both programs so if you had done PPP you might refrain from doing 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 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 in the past do the banks do it nope the banks don’t 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 before unless you have an account that entered into this company and bottom line my firm Kevin has been in business given that 2009 and we have actually been dealing with the federal government and the state federal government to recover cash for Fortune 500 Fortune 1000 business so a lot of our huge big corporate customers have dealt with bottom line to recover other federal government programs we’ve done sales tax and use tax unemployment tax work opportunity tax credits research and development tax credits unclaimed home real estate tax all of these other federal government programs.
The staff member retention tax credit is a broad based refundable tax credit designed to encourage.
companies to keep staff members on their payroll. The credit is 50% of approximately $10,000 in salaries paid by an.
Because of COVID-19 or whose gross receipts, employer whose organization is totally or partly suspended.
decrease 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.
companies who take Small Business Loans.
2. To certify, the employer needs to satisfy one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the employer’s service is completely or partly suspended by federal government order due to COVID-19.
during the calendar quarter or.
o the company’s gross receipts are listed below 50% of the similar quarter in 2019. When the.
company’s gross invoices go above 80% of an equivalent quarter in 2019 they no longer certify.
after completion 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 earnings paid after March 13th and prior to December 31, 2020.
The definition of certifying earnings differs by whether a company had, usually, more or less than.
100 staff members in 2019.
Companies that concentrate on ERC filing assistance usually supply know-how and assistance to assist businesses navigate the intricate process of declaring the credit. They can offer various services, including:.
How is the employee retention credit calculated? Deadline To Apply For Employee Retention Credit 2021
Eligibility Assessment: These companies will examine your service’s eligibility for the ERC based on elements such as your market, profits, and operations. If you fulfill the requirements for the credit and determine the maximum credit quantity you can claim, they can help determine.
Paperwork and Calculation: ERC filing services will assist in collecting the essential documentation, such as payroll records and monetary statements, to support your claim. They will also help determine the credit quantity based upon eligible wages and other certifying expenses.
Retroactive Claim Evaluation: If you are eligible to declare the ERC for previous quarters, these business can evaluate your previous payroll records and financials to recognize possible opportunities for retroactive credits. They can assist you change prior tax returns to declare these refunds.
Filing Support: Business focusing on ERC filings will prepare and submit the required forms and paperwork on your behalf. This includes finishing Kind 941 or any other necessary tax return.
Compliance and Updates: ERC regulations and guidance have progressed over time. These companies stay updated with the most recent modifications and guarantee that your filings comply with the most current standards. If the Internal revenue service requests additional details or performs an audit associated to your ERC claim, they can also offer continuous support.
It is very important to research and veterinarian any business using ERC filing support to guarantee their reliability and competence. Try to find established companies with experience in tax and payroll services, or consider connecting to trusted accounting companies or tax experts who use ERC filing support.
Remember that while these companies can offer valuable help, it’s constantly a great idea to have a standard understanding of the ERC requirements and procedure yourself. This will help you make notified choices and make sure accurate filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief steps. The goal of the ERC is to motivate organizations to retain and pay their staff members during the pandemic, even if their operations have actually been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is offered to qualified employers, including for-profit services, tax-exempt organizations, and certain governmental entities. To certify, companies must fulfill one of two requirements:.
The business operations were fully or partly suspended due to a federal government order related to COVID-19.
Business experienced a substantial decrease in gross invoices. As pointed out previously, for 2021, a substantial decrease is defined as a 20% decrease in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a significant decline is defined as a 20% decline in gross receipts compared to the exact same quarter in 2019, or a 20% decrease in gross invoices compared to the instantly preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit amount amounts to a percentage (up to 70%) of certified wages paid to staff members, consisting of particular health insurance costs. 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 got a Paycheck Defense 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 received a PPP loan. The very same salaries can not be utilized to claim both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively broadened and enhanced, allowing qualified employers to claim the credit for qualified incomes paid as far back as March 13, 2020. This retroactive arrangement offers an opportunity for organizations to modify prior-year income tax return and receive refunds.
Claiming the Credit: Employers can declare the ERC by reporting it on their work income tax return, typically Kind 941. If the credit surpasses the quantity of employment taxes owed, the excess can be refunded to the employer.
It is necessary to note that the ERC provisions and eligibility criteria have actually developed over time. The best course of action is to seek advice from a tax expert or check out the main internal revenue service website for the most current and comprehensive details concerning the ERC, consisting of any current legislative changes or updates.
To qualify for the ERC, an organization should satisfy one of the following requirements:.
Business operations were totally or partially suspended due to a government order related to COVID-19.
The business experienced a substantial decrease in gross receipts. For 2021, a considerable decrease is specified as a 20% decrease in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a considerable decrease is defined as a 20% decline in gross receipts compared to the exact same quarter in 2019, or a 20% decrease in gross receipts compared to the immediately preceding quarter.
The ERC is readily available to businesses of all sizes, including tax-exempt companies, but there are some exceptions. For instance, federal government entities and companies that got a PPP loan may have limitations on declaring the credit.
The process for claiming the ERC involves completing the necessary forms and consisting of the credit on your employment tax return (normally Type 941). The exact time it takes to process the credit can vary based upon a number of factors, consisting of the complexity of your company and the workload of the IRS. It’s advised to consult with a tax professional for assistance specific to your circumstance.
There are a number of business that can assist with the process of claiming the ERC. These include accounting companies, tax advisory services, and payroll company. Some well-known business that use assistance with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s a good idea to research and contact these business directly to ask about their charges and services.
Please note that the details provided here is based on basic understanding and may not reflect the most recent updates or modifications to the ERC. It is necessary to consult with a tax professional or go to the main IRS website for the most up-to-date and precise info relating to eligibility, claiming procedures, and available help.
Less than 100. The credit is based if the company had 100 or less employees on average in 2019.
on incomes paid to all employees whether they actually worked or not. Simply put, even if the.
workers 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 employees typically in 2019, then the credit is.
enabled just for incomes paid to staff members who did not work throughout the calendar quarter.
In both cases, “incomes” consists of not just money payments however also a portion of the expense of employer.
supplied health care. Deadline To Apply For Employee Retention Credit 2021
Companies can be instantly compensated for the credit by reducing the amount of payroll taxes they.