Lets talk first about Employee Retention Credit 2021 Infrastructure Bill :
Our group here what do these guys doing everyone in this room is assisting teach individuals about ERC and uh always supply a stunning breakfast and have individuals truly learn about the program we need to head to the room where we are able to display a few 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 indicate you know if you just start 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 mean it’s just I imply consider how many real customers 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 confirmed and the check is on the mail in the mail from the IRS heading to the client so that’s how you’re able to track it you understand when you
get this you understand the check is gone for sure and that’s when they pay so they do not pay anything up until they actually receive the money they do not pay bottom line Wonder trust anything till this letter is validated the check is on the way they transfer it into their savings account and they can truly trust Wonder trust that the procedure has been completed and the number of you think you’ve processed given that you began this we’re about 35 000 of these for
about six billion dollars wow so plainly they know what they’re doing and that’s what you need you require specialists on the other end of the phone to process this and get it to where you get among these that’s what matters all right Mr Fantastic here you’re at my YouTube channel we’re speaking about something really important today the staff member retention credit which most of you have never become aware of I certainly had not heard of it till extremely recently and found out a lot about it since this is most likely the lowest cost of capital for any small company anywhere
anytime if you have employees between five and five hundred so I’ve got the expert with me this is Josh Fox he’s the founder and CEO of bottom line Principles 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 simply call up your bank manager and state 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’ve ended up being yes the Ambassador and paid representative for this I love this program it’s going away very soon you got to learn everything about it let’s talk employee retention credit Josh Fox what is an ERC let’s simply begin there so during the Trump Administration when President Trump was enacted they created the cares Act and the cares act used businesses three 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 difference 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 all right go on sorry I just need to ensure we got that point I mean that’s a huge difference a loan versus cash cash I like money money that’s what we’re speaking about all right 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 gorgeous tough check in the mail where you get actual cash from the internal revenue service all right so let’s talk about how it works due to the fact that it seems like to me if it’s a if it’s worker retention credit that person had to be a staff member 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 staff members right you needed to have actually owned an organization but it’s based on you having W-2 workers 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 qualified 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 6 quarters the program was open well walk us through the 6 quarters so you had quarters 2 3 and four of 2020 and you had quarters one 2 and three of 2021. alright so that’s how it’s determined you need to be on the W-2 during that duration now let’s talk my favorite part cash how much can you get back per staff member that was on a W-2 in those six quarters so the calculation in 2020 to be specific Kevin is 50 of the employee’s salary to a maximum of five thousand dollars per worker for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the worker’s salary to a maximum of seven thousand per quarter how did that occur 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 as much as five thousand Max and after that what takes place 21 000 Max in 2021 oh that’s how you develop twenty six thousand twenty one thousand to twenty twenty one plus five thousand in twenty twenty that’s twenty six thousand dollars per employee that is because that’s a great deal of cash it is now there’s a caution here the PPP money would have to be reduced 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 cash somewhere around 10 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 money you would still get a million dollar in the mail from the IRS so it’s substantial certainly now the big question is why does no one know about this due to the fact that look when I initially found out about this when I initially satisfied Josh you know I have actually got lots of investments in great deals of business I’m a major supporter for entrepreneurship in America and make numerous numerous financial investments in entrepreneurs of which lots of suffered through the pandemic when I initially heard about this I called BS I do not believe it because I use 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 deserved and we used them carefully 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 politician pals Governor Senators they didn’t learn about it I mean that’s how you understand that’s how misinformation is that there’s no info out there then a lot of people told 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 no one learn about the staff member retention credit you understand what’s fascinating you’re speaking about the banks Kevin because in the PPP loan procedure the federal government made it extremely clear that if you wanted a PPP loan you would call Wells Fargo Citibank Bank of America any of the huge banks in our country and they would process procedure in Canada a pre-pp loan there’s no loans in Canada by the way it’s just process process that’s all um and here there was mayhem because keep in mind in the initial cares act you might refrain from doing both programs so if you had actually done PPP you might not do ERC in the initial 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 really he or she’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 company your accountant no your accounting professional’s never ever done this before unless you have an account that went into this service and bottom line my firm Kevin has been in business because 2009 and we have actually been working with the federal government and the state federal government to recover money for Fortune 500 Fortune 1000 business so a great deal of our big huge business customers have dealt with bottom line to recuperate other government programs we’ve done sales tax and use tax joblessness tax work chance 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 developed to encourage.
companies to keep employees on their payroll. The credit is 50% of up to $10,000 in incomes paid by an.
Because of COVID-19 or whose gross invoices, company whose company is completely or partially suspended.
decrease by more than 50%.
1. The credit is available to all employers no matter size including tax exempt companies. There are.
only 2 exceptions: (1) state and city governments and their instrumentalities and (2) small.
services who take Small Business Loans.
2. To qualify, the company has to fulfill one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the company’s organization is completely or partly suspended by government order due to COVID-19.
throughout the calendar quarter or.
o the employer’s gross invoices are below 50% of the comparable quarter in 2019. When the.
company’s gross receipts exceed 80% of a comparable quarter in 2019 they no longer qualify.
after completion of that quarter.
Computation of the Credit.
The amount of the credit is 50% of the certifying salaries paid up to $10,000 in total.
It works for incomes paid after March 13th and prior to December 31, 2020.
The meaning of certifying wages differs by whether a company had, on average, more or less than.
100 workers in 2019.
Business that focus on ERC filing assistance usually provide proficiency and support to help companies navigate the intricate procedure of declaring the credit. They can provide various services, including:.
How is the employee retention credit calculated? Employee Retention Credit 2021 Infrastructure Bill
Eligibility Evaluation: These companies will evaluate your company’s eligibility for the ERC based on factors such as your industry, revenue, and operations. If you meet the requirements for the credit and recognize the maximum credit amount you can claim, they can help figure out.
Documents and Estimation: ERC filing services will help in gathering the needed documentation, such as payroll records and monetary declarations, to support your claim. They will likewise help determine the credit quantity based upon eligible incomes and other qualifying costs.
Retroactive Claim Review: If you are eligible to declare the ERC for prior quarters, these companies can review your past payroll records and financials to determine potential opportunities for retroactive credits. They can help you amend previous tax returns to declare these refunds.
Filing Help: Companies focusing on ERC filings will prepare and send the needed forms and paperwork in your place. This includes completing Kind 941 or any other required tax return.
Compliance and Updates: ERC guidelines and assistance have developed in time. These business stay upgraded with the latest changes and make sure that your filings comply with the most existing guidelines. If the IRS demands extra details or performs an audit associated to your ERC claim, they can also offer continuous support.
It is essential to research and vet any company using ERC filing assistance to ensure their trustworthiness and know-how. Try to find recognized firms with experience in tax and payroll services, or consider connecting to relied on accounting firms or tax professionals who use ERC filing support.
Bear in mind that while these companies can offer important help, it’s constantly a good concept to have a standard understanding of the ERC requirements and process yourself. This will help you make notified decisions and ensure precise filings.
The Worker Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief measures. The goal of the ERC is to motivate companies to keep and pay their workers 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 qualified employers, including for-profit companies, tax-exempt organizations, and specific governmental entities. To qualify, companies should satisfy one of two criteria:.
The business operations were totally or partially suspended due to a government order related to COVID-19.
The business experienced a significant decline in gross receipts. As mentioned previously, for 2021, a significant decrease is specified as a 20% decrease in gross receipts compared to the exact 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 invoices compared to the right away preceding quarter.
Credit Amount: The ERC is a refundable tax credit that offsets the employer’s share of Social Security taxes. The credit amount is equal to a portion (up to 70%) of certified incomes paid to staff members, consisting of particular 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: At first, organizations that got a Paycheck Security Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 allows services to claim the ERC even if they received a PPP loan. The exact same wages can not be utilized to claim both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has actually been retroactively expanded and improved, permitting eligible employers to claim the credit for qualified wages paid as far back as March 13, 2020. This retroactive arrangement supplies an opportunity for services to modify prior-year income tax return and get refunds.
Declaring the Credit: Employers can declare the ERC by reporting it on their work tax returns, generally Kind 941. If the credit goes beyond the quantity of employment taxes owed, the excess can be refunded to the company.
It’s important to keep in mind that the ERC provisions and eligibility requirements have developed in time. The best strategy is to speak with a tax professional or go to the official IRS site for the most comprehensive and up-to-date information concerning the ERC, including any recent legal modifications or updates.
To receive the ERC, an organization needs to fulfill among the following requirements:.
The business operations were totally or partially suspended due to a government order related to COVID-19.
The business experienced a significant decrease in gross invoices. For 2021, a significant decline is defined as a 20% decline in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a considerable decrease is specified as a 20% decrease in gross invoices compared to the exact same quarter in 2019, or a 20% decrease in gross receipts compared to the instantly preceding quarter.
The ERC is available to businesses of all sizes, including tax-exempt companies, however there are some exceptions. Federal government entities and organizations that got a PPP loan might have restrictions on declaring the credit.
The procedure for declaring the ERC involves completing the needed types and consisting of the credit on your work tax return (generally Type 941). The exact time it requires to process the credit can vary based upon a number of elements, consisting of the complexity of your business and the workload of the IRS. It’s recommended to consult with a tax professional for assistance specific to your scenario.
There are numerous business that can help with the process of declaring the ERC. These consist of accounting firms, tax advisory services, and payroll service providers. Some popular companies that offer support with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s recommended to research study and call these companies directly to inquire about their charges and services.
Please note that the info supplied here is based on general understanding and may not reflect the most current updates or modifications to the ERC. It is very important to seek advice from a tax expert or visit the main IRS site for the most current and precise details relating to eligibility, claiming treatments, and offered help.
Less than 100. If the employer had 100 or less employees typically in 2019, then the credit is based.
on wages paid to all staff members whether they in fact worked or not. In other words, even if the.
staff members worked full-time and made money for full time work, the company still gets the credit.
Greater than 100. The credit is if the company had more than 100 staff members on average in 2019.
allowed just for salaries paid to staff members who did not work throughout the calendar quarter.
In both cases, “salaries” includes not just cash payments however also a portion of the expense of employer.
supplied healthcare. Employee Retention Credit 2021 Infrastructure Bill
Companies can be right away reimbursed for the credit by decreasing the quantity of payroll taxes they.