Lets talk first about Employee Retention Credit 70 Percent :
Our team here what do these people doing everybody in this space is helping teach people about ERC and uh constantly provide a lovely breakfast and have individuals really learn more about the program we ought to head to the space where we are able to display some 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 millions of dollars so these are duplicate copies of the letters that go to customers verifying that the check is on the method I mean you know if you just start to take a look at a few of these here I indicate this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I imply it’s simply I mean think of the number of real customers that went through the program yeah this is the very end this is the party at the end when the check is validated the numbers are validated 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 understand when you
receive this you understand the check is chosen sure which’s when they pay so they do not pay anything until they actually get the money they do not pay bottom line Wonder trust anything till this letter is verified the check is on the way they transfer it into their checking account and they can truly rely on Wonder trust that the process has been completed and how many you believe you have actually processed given that you began this we have to do with 35 000 of these for
about 6 billion dollars wow so clearly they know what they’re doing which’s what you need 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 discussing something really essential today the worker retention credit which the majority of you have never ever heard of I certainly hadn’t become aware of it up until extremely just recently and discovered a lot about it since this is probably the most affordable cost of capital for any small business anywhere
anytime if you have staff members in between 5 and five hundred so I’ve 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 not easy this isn’t like PPP we simply contact your bank manager and state provide me a loan it doesn’t 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 become yes the Ambassador and paid representative for this I love this program it’s disappearing very soon you got to learn all about it let’s talk staff member retention credit Josh Fox what is an ERC let’s simply begin there so throughout the Trump Administration when President Trump was enacted they developed the cares Act and the cares act provided services 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 big difference right there 2 of them are loans and one’s a refund precisely so the ERC is a refund that’s.
fix the cash money payroll tax refund all right go on sorry I simply need to ensure we got that point I indicate that’s a huge distinction a loan versus cash cash I like money cash that’s what we’re discussing fine 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 IRS all right so let’s discuss 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 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 owned an organization however it’s based upon you having W-2 staff members in America not 10.99. As long as you had W-2 staff members and you paid federal payroll taxes that’s why you would be qualified 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 correct so there were 6 quarters the program was open well stroll us through the 6 quarters so you had quarters 2 three and 4 of 2020 and you had quarters one two and 3 of 2021. fine so that’s how it’s determined you need to be on the W-2 throughout that duration now let’s talk my preferred part money 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 employee’s wage to a maximum of 5 thousand dollars per worker for the year of 2020 and in 2021 the numbers escalated to 70 of the employee’s wage to an optimum of seven thousand per quarter how did that take place um they simply changed the rules in.
2021 versus since the mayhem 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 after that what happens 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 6 thousand dollars per staff member that is because that’s a lot of money it is now there’s a caveat here the PPP cash would need to be reduced from the twenty six thousand dollars so if you took PPP loan one and PPP loan two 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 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 big certainly now the big question is why does nobody know about this since appearance when I initially became aware of this when I initially met Josh you know I’ve got great deals of investments in great deals of business I’m a major supporter for entrepreneurship in America and make lots of many financial investments in entrepreneurs of which numerous suffered through the pandemic when I initially heard about this I called BS I don’t believe 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 deserved and we utilized them sensibly to stay alive 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 politician friends Guv Senators they didn’t learn about it I suggest that’s how you understand that’s how false information is that there’s no info out there then a lot of people told me well you can’t get it because you took the PPP also not true so let’s ask Josh why does nobody learn about the employee retention credit you understand what’s fascinating you’re talking about the banks Kevin because in the PPP loan procedure the federal government made it very 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 procedure in Canada a pre-pp loan there’s no loans in Canada by the way it’s simply process process that’s all um and here there was turmoil since keep in mind in the original cares act you might refrain from doing both programs so if you had done PPP you could refrain from doing ERC in the original 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 ever made it clear to anyone about how to.
do this does your CFO know how to do this not actually he or she’s never done it previously do the banks do it nope the banks don’t do it the payroll companies yeah some of them are doing it as a payroll business your accounting professional no your accounting professional’s never done this prior to unless you have an account that entered into this business and bottom line my company Kevin has stayed in business considering that 2009 and we have actually been working with the federal government and the state federal government to recuperate money for Fortune 500 Fortune 1000 companies so a lot of our big huge business clients have worked with bottom line to recover other government programs we have actually done sales tax and utilize tax unemployment tax work chance tax credits research and development tax credits unclaimed property property tax all of these other government programs.
The staff member retention tax credit is a broad based refundable tax credit developed to encourage.
companies to keep staff members on their payroll. The credit is 50% of up to $10,000 in earnings paid by an.
company whose service is fully or partly suspended because of COVID-19 or whose gross invoices.
decrease by more than 50%.
Availability.
1. The credit is offered to all employers no matter size including tax exempt companies. There are.
just 2 exceptions: (1) state and local governments and their instrumentalities and (2) small.
businesses who take Small Business Loans.
2. To qualify, the company has to meet one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the employer’s company is completely or partially suspended by federal government order due to COVID-19.
throughout the calendar quarter or.
o the employer’s gross receipts are below 50% of the equivalent quarter in 2019. As soon as the.
employer’s gross invoices go above 80% of an equivalent quarter in 2019 they no longer qualify.
after completion of that quarter.
Estimation of the Credit.
The quantity of the credit is 50% of the qualifying wages paid up to $10,000 in overall.
It is effective for earnings paid after March 13th and prior to December 31, 2020.
The definition of qualifying salaries varies by whether a company had, usually, basically than.
100 employees in 2019.
Business that specialize in ERC filing help generally offer expertise and assistance to help services navigate the intricate procedure of declaring the credit. They can offer different services, including:.
How is the employee retention credit calculated? Employee Retention Credit 70 Percent
Eligibility Evaluation: These companies will examine your service’s eligibility for the ERC based on elements such as your industry, revenue, and operations. They can assist determine if you meet the requirements for the credit and determine the optimum credit amount you can claim.
Paperwork and Estimation: ERC filing services will help in collecting the needed paperwork, such as payroll records and financial declarations, to support your claim. They will also assist determine the credit amount based on eligible earnings and other certifying costs.
Retroactive Claim Review: If you are qualified to claim the ERC for prior quarters, these companies can review your previous payroll records and financials to determine prospective opportunities for retroactive credits. They can assist you amend previous income tax return to declare these refunds.
Filing Assistance: Business specializing in ERC filings will prepare and send the required types and documentation on your behalf. This consists of completing Form 941 or any other required tax return.
Compliance and Updates: ERC regulations and guidance have actually progressed over time. These companies stay updated with the current changes and guarantee that your filings abide by the most current standards. They can likewise provide continuous support if the internal revenue service demands extra info or carries out an audit related to your ERC claim.
It is essential to research study and vet any company using ERC filing support to ensure their reliability and knowledge. Search for recognized firms with experience in tax and payroll services, or consider reaching out to relied on accounting firms or tax professionals who offer ERC submitting assistance.
Keep in mind that while these companies can supply important help, it’s constantly a good concept to have a basic understanding of the ERC requirements and procedure yourself. This will help you make notified choices and guarantee precise filings.
The Employee Retention Credit (ERC) is a refundable tax credit presented by the U.S. federal government as part of COVID-19 relief measures. The objective of the ERC is to encourage organizations to retain and pay their employees throughout the pandemic, even if their operations have actually been affected.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is readily available to qualified employers, consisting of for-profit companies, tax-exempt companies, and certain governmental entities. To certify, companies must satisfy one of two requirements:.
Business operations were completely or partially suspended due to a federal government order related to COVID-19.
The business experienced a considerable decline in gross invoices. As mentioned previously, for 2021, a considerable decrease is defined as a 20% decrease in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a significant decrease is specified as a 20% decrease 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 is equal to a percentage (up to 70%) of certified wages paid to employees, consisting of particular 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, services that got an Income Protection Program (PPP) loan were not qualified for the ERC. However, legislation passed in late 2020 and extended in 2021 permits companies to claim the ERC even if they got a PPP loan. However, the very same earnings can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively broadened and enhanced, permitting qualified companies to declare the credit for qualified earnings paid as far back as March 13, 2020. This retroactive provision supplies an opportunity for businesses to amend prior-year tax returns and receive refunds.
Declaring the Credit: Companies can claim the ERC by reporting it on their employment income tax return, usually Form 941. The excess can be reimbursed to the company if the credit exceeds the quantity of employment taxes owed.
It is essential to keep in mind that the ERC arrangements and eligibility requirements have actually evolved with time. The very best course of action is to talk to a tax professional or check out the main internal revenue service site for the most detailed and updated info concerning the ERC, consisting of any recent legislative modifications or updates.
To qualify for the ERC, a company should fulfill one of the following requirements:.
The business operations were totally or partially suspended due to a government order related to COVID-19.
The business experienced a substantial decrease in gross invoices. For 2021, a significant decline 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% decrease 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 services of all sizes, consisting of tax-exempt organizations, however there are some exceptions. For instance, government entities and organizations that got a PPP loan might have limitations on claiming the credit.
The process for claiming the ERC includes finishing the essential types and including the credit on your work tax return (usually Type 941). The exact time it takes to process the credit can differ based upon several aspects, including the intricacy of your service and the work of the IRS. It’s advised to consult with a tax professional for assistance specific to your scenario.
There are numerous companies that can assist with the procedure of declaring the ERC. These consist of accounting companies, tax advisory services, and payroll service providers. Some well-known companies that use assistance with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s a good idea to research and call these business directly to ask about their services and fees.
Please keep in mind that the info supplied here is based on general understanding and might not show the most recent updates or modifications to the ERC. It is necessary to seek advice from a tax expert or visit the official internal revenue service site for the most current and precise information regarding eligibility, declaring treatments, and available help.
Less than 100. The credit is based if the company had 100 or fewer staff members on average in 2019.
on earnings paid to all employees whether they actually worked or not. Simply put, even if the.
staff members worked full-time and got paid for full time work, the employer still gets the credit.
Greater than 100. The credit is if the employer had more than 100 staff members on average in 2019.
allowed only for incomes paid to staff members who did not work throughout the calendar quarter.
In both cases, “incomes” includes not simply cash payments but likewise a portion of the cost of employer.
provided healthcare. Employee Retention Credit 70 Percent
Payment.
Employers can be right away repaid for the credit by reducing the quantity of payroll taxes they.