Lets talk first about Employee Retention Credit Aggregation Rules 2021 :
Our group here what do these people doing everybody in this room is assisting teach individuals about ERC and uh constantly supply a lovely breakfast and have individuals truly discover the program we need to head to the room where we have the ability to show a few of the checks that we are getting for business and I wish to see that what is this this is uh hundreds of countless dollars actually Kevin hundreds of countless dollars so these are replicate copies of the letters that go to clients confirming that the check is on the way I imply you know if you just start to look at some of these here I mean this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I mean it’s simply I imply think about how many actual customers that went through the program yeah this is the very end this is the celebration at the end when the check is confirmed the numbers are validated and the check is on the mail in the mail from the IRS heading to the customer so that’s how you’re able to track it you know when you
get this you know the check is opted for sure which’s when they pay so they don’t pay anything till they in fact receive the cash they don’t pay bottom line Wonder trust anything till this letter is confirmed the check is on the method they transfer it into their bank account and they can really rely on Wonder trust that the process has been finished and how many you believe you have actually processed because 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 and that’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 Terrific here you’re at my YouTube channel we’re talking about something truly important today the staff member retention credit which most of you have never heard of I certainly hadn’t become aware of it up until very recently and found out a lot about it because this is most likely the lowest expense of capital for any small business anywhere
anytime if you have staff members between 5 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 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 say offer 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 ended up being yes the Ambassador and paid spokesperson for this I enjoy this program it’s disappearing very soon you got to find out all about it let’s talk employee retention credit Josh Fox what is an ERC let’s just start there so throughout the Trump Administration when President Trump was enacted they developed the cares Act and the cares act provided businesses three chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and almost everyone it makes a huge distinction right there 2 of them are loans and one’s a refund exactly so the ERC is a refund that’s.
fix the cash money payroll tax refund alright go on sorry I simply have to make certain we got that point I imply that’s a huge difference a loan versus cash money I like cash cash that’s what we’re speaking about 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 initial cares Act is the ERC and yes Kevin it is a gorgeous tough check in the mail where you get real money from the internal revenue service all right so let’s discuss how it works due to the fact that it sounds like to me if it’s a if it’s worker retention credit that individual had to be a worker so I’m going to make the Presumption this money is not for the owner not for individuals on the cap table not for investors it’s for workers right you had to have owned a business however it’s based on you having W-2 workers 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 six months of 2021 on the W-2 correct so there were six quarters the program was open well walk us through the six quarters so you had quarters 2 three and four of 2020 and you had quarters one 2 and three of 2021. alright 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 get back 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 income to an optimum of 5 thousand dollars per staff member for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the staff member’s wage to a maximum of 7 thousand per quarter how did that occur um they simply altered the rules in.
2021 versus since the turmoil of the pandemic so they wished 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 as much as 5 thousand Max and after that what happens 21 000 Max in 2021 oh that’s how you create twenty 6 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 caveat here the PPP cash would have to be decreased from the twenty six thousand dollars so if you took PPP loan one and PPP loan 2 you would reduce the 26 000 so what we’re seeing usually Kevin is if you took PPP money somewhere around 10 thousand dollars an individual so let’s say hypothetically you owned a restaurant in New York City where I’m from and you had a hundred workers and you took PPP cash you would still get a million dollar in the mail from the internal revenue service so it’s substantial clearly now the huge question is why does no one understand about this due to the fact that appearance when I first became aware of this when I first satisfied Josh you understand I have actually got great deals of financial investments in great deals of business I’m a major advocate for entrepreneurship in America and make numerous lots of financial investments in business owners of which lots of suffered through the pandemic when I initially heard about this I called BS I do not think it due to the fact that I utilize the PPP we went through the money center Banks to get it it was really easy to do we had our CEOs call the banks they got their loans and that were well been worthy of and we used them carefully to stay alive during the pandemic so when I heard about this I said nah it can’t hold true but when I dug around I even contacted us to my politician pals Governor Senators they didn’t know about it I indicate that’s how you know that’s how false information is that there’s no information out there then a lot of people informed me well you can’t get it since you took the PPP also not true so let’s ask Josh why does nobody learn about the employee retention credit you know what’s interesting you’re talking about the banks Kevin since in the PPP loan process 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 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 procedure that’s all um and here there was turmoil because remember in the initial 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 ever made it clear to anybody about how to.
do this does your CFO know how to do this not actually he or she’s never done it in the past 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 done this prior to unless you have an account that entered into this business and bottom line my firm Kevin has actually stayed in business since 2009 and we have actually been working with the federal government and the state federal government to recover cash for Fortune 500 Fortune 1000 companies so a great deal of our big big corporate customers have worked with bottom line to recover other federal government programs we’ve done sales tax and utilize tax joblessness tax work opportunity tax credits research and development tax credits unclaimed home real estate tax all of these other federal government programs.
The worker retention tax credit is a broad based refundable tax credit created to motivate.
employers to keep employees on their payroll. The credit is 50% of up to $10,000 in wages paid by an.
Since of COVID-19 or whose gross receipts, company whose service is fully or partly suspended.
decline by more than 50%.
1. The credit is offered to all companies regardless of size consisting of tax exempt companies. There are.
just 2 exceptions: (1) state and local governments and their instrumentalities and (2) little.
organizations who take Small Business Loans.
2. To certify, the employer needs to fulfill one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the employer’s organization is totally 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 equivalent quarter in 2019. Once the.
employer’s gross receipts exceed 80% of a comparable 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 incomes paid up to $10,000 in total.
It works for incomes paid after March 13th and before December 31, 2020.
The definition of certifying salaries differs by whether a company had, usually, basically than.
100 staff members in 2019.
Companies that focus on ERC filing help generally offer know-how and support to assist organizations browse the complex procedure of declaring the credit. They can provide different services, including:.
How is the employee retention credit calculated? Employee Retention Credit Aggregation Rules 2021
Eligibility Assessment: These business will examine your company’s eligibility for the ERC based upon factors such as your market, profits, and operations. They can assist determine if you fulfill the requirements for the credit and determine the optimum credit amount you can declare.
Documentation and Estimation: ERC filing services will help in gathering the essential documents, such as payroll records and financial statements, to support your claim. They will also assist calculate the credit amount based on eligible earnings and other certifying expenditures.
Retroactive Claim Review: If you are qualified to claim the ERC for prior quarters, these companies can evaluate your past payroll records and financials to identify potential opportunities for retroactive credits. They can assist you modify previous tax returns to declare these refunds.
Filing Help: Companies concentrating on ERC filings will prepare and send the needed forms and documents in your place. This includes finishing Form 941 or any other necessary tax forms.
Compliance and Updates: ERC guidelines and guidance have developed in time. These companies remain updated with the latest changes and guarantee that your filings comply with the most existing guidelines. They can also supply ongoing support if the IRS demands additional information or performs an audit related to your ERC claim.
It’s important to research study and veterinarian any company providing ERC filing assistance to ensure their credibility and competence. Look for recognized companies with experience in tax and payroll services, or consider connecting to trusted accounting companies or tax professionals who use ERC submitting support.
Bear in mind that while these companies can supply valuable help, it’s constantly a great concept to have a standard understanding of the ERC requirements and process yourself. This will assist you make informed decisions and guarantee precise 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 objective of the ERC is to motivate businesses to keep and pay their workers during the pandemic, even if their operations have been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is available to qualified companies, consisting of for-profit businesses, tax-exempt organizations, and particular governmental entities. To certify, companies should meet one of two criteria:.
Business operations were fully or partly suspended due to a federal government order related to COVID-19.
The business experienced a significant decrease in gross invoices. As mentioned previously, for 2021, a substantial decline is defined as a 20% decrease in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a significant decline is specified as a 20% decrease in gross receipts compared to the very same quarter in 2019, or a 20% decline in gross receipts 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 quantity is equal to a portion (approximately 70%) of certified salaries paid to employees, consisting of certain 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, organizations that got a Paycheck Security Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 permits organizations to declare the ERC even if they received a PPP loan. However, the very same incomes can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively expanded and improved, allowing eligible employers to claim the credit for qualified wages paid as far back as March 13, 2020. This retroactive provision offers an opportunity for companies to amend prior-year tax returns and get refunds.
Declaring the Credit: Companies can declare the ERC by reporting it on their work income tax return, usually Type 941. If the credit surpasses the amount of employment taxes owed, the excess can be reimbursed to the company.
It is essential to keep in mind that the ERC arrangements and eligibility criteria have actually evolved in time. The best course of action is to talk to a tax professional or go to the official IRS site for the most comprehensive and up-to-date details concerning the ERC, including any current legislative changes or updates.
To qualify for the ERC, an organization must fulfill among the following criteria:.
The business operations were completely or partly suspended due to a federal government order related to COVID-19.
Business experienced a considerable decrease in gross invoices. For 2021, a significant decrease is defined as a 20% decline in gross receipts compared to the exact 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% decrease in gross invoices compared to the right away preceding quarter.
The ERC is available to companies of all sizes, including tax-exempt companies, but there are some exceptions. Government entities and services that received a PPP loan might have limitations on claiming the credit.
The procedure for declaring the ERC includes completing the needed kinds and consisting of the credit on your work tax return (normally Kind 941). The exact time it takes to process the credit can vary based on a number of elements, including the complexity of your organization and the workload of the internal revenue service. It’s recommended to seek advice from a tax expert for assistance particular to your circumstance.
There are a number of companies that can help with the procedure of declaring the ERC. Some popular business that offer support with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the information supplied here is based on basic understanding and may not reflect the most recent updates or changes to the ERC. It’s important to seek advice from a tax professional or visit the main internal revenue service website for the most current and precise details regarding eligibility, claiming treatments, and offered support.
Less than 100. If the company had 100 or fewer staff members typically in 2019, then the credit is based.
on incomes paid to all staff members whether they really worked or not. To put it simply, even if the.
staff members worked full time and earned money for full time work, the company still gets the credit.
Greater than 100. If the employer had more than 100 employees usually in 2019, then the credit is.
permitted only for wages paid to staff members who did not work during the calendar quarter.
In both cases, “salaries” includes not just cash payments but likewise a part of the expense of employer.
supplied health care. Employee Retention Credit Aggregation Rules 2021
Companies can be immediately repaid for the credit by decreasing the amount of payroll taxes they.