Lets talk first about Employee Retention Credit Audit Period :
Our group here what do these guys doing everybody in this room is assisting teach people about ERC and uh always offer a gorgeous breakfast and have individuals truly learn more about the program we must head to the space where we have the ability to display a few of the checks that we are getting for companies and I wish to see that what is this this is uh hundreds of countless 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 method I suggest you know if you just begin to 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 imply it’s simply I imply consider the number of 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 verified 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 know when you
get this you understand the check is gone for sure and that’s when they pay so they don’t pay anything till they actually receive the cash they do not pay bottom line Wonder trust anything until this letter is verified the check is on the way they transfer it into their bank account and they can really trust Wonder trust that the procedure has been completed and how many you believe you have actually processed considering 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 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 Terrific here you’re at my YouTube channel we’re speaking about something truly important today the staff member retention credit which most of you have actually never become aware of I definitely had not heard of it up until very recently and learned a lot about it because this is most likely the lowest cost of capital for any small business anywhere
anytime if you have employees in between 5 and five hundred so I have actually got the specialist with me this is Josh Fox he’s the founder and CEO of bottom line Concepts they’re the biggest processor of these ERC credits this is a 170 page program so it’s challenging this isn’t like PPP we simply contact 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 inform 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 soon you got to learn everything about it let’s talk staff member retention credit Josh Fox what is an ERC let’s just start there so during the Trump Administration when President Trump was enacted they developed the cares Act and the cares act used organizations 3 opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically everyone it makes a big distinction right there two of them are loans and one’s a refund precisely so the ERC is a refund that’s.
correct the cash money payroll tax refund okay go on sorry I just need to make certain we got that point I suggest that’s a huge distinction a loan versus cash cash I like money cash that’s what we’re discussing alright 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 hard check in the mail where you get actual money from the internal revenue service all right so let’s speak about 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 Assumption this cash is not for the owner not for individuals on the cap table not for investors it’s for employees right you needed to have owned a company however it’s based upon you having W-2 workers in America not 10.99. so 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 proper so there were six quarters the program was open well walk us through the six quarters so you had quarters two three and 4 of 2020 and you had quarters one two and three of 2021. alright so that’s how it’s measured you need to be on the W-2 during that duration now let’s talk my preferred part money just how much can you get back per staff member that was on a W-2 in those six quarters so the computation in 2020 to be specific Kevin is 50 of the worker’s salary to an optimum of five thousand dollars per worker for the year of 2020 and in 2021 the numbers increased to 70 of the staff member’s salary to a maximum of 7 thousand per quarter how did that happen um they simply altered the rules in.
2021 versus due to the fact that the turmoil of the pandemic so they wanted 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 happens 21 000 Max in 2021 oh that’s how you come up with 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 since that’s a lot of money 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 two you would lower the 26 000 so what we’re seeing typically Kevin is if you took PPP money someplace around 10 thousand dollars a person so let’s say hypothetically you owned a restaurant in New york city City where I’m from and you had a hundred staff members and you took PPP money you would still get a million dollar in the mail from the IRS so it’s substantial clearly now the big concern is why does nobody learn about this because appearance when I first found out about this when I first met Josh you know I’ve got lots of investments in great deals of companies I’m a significant supporter for entrepreneurship in America and make many many investments in business owners 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 extremely 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 wisely to stay alive throughout the pandemic so when I heard about this I stated nah it can’t hold true but when I dug around I even contacted us to my political leader good friends Guv Senators they didn’t know about it I mean that’s how you know that’s how false information is that there’s no info out there then a lot of people informed me well you can’t get it due to the fact that you took the PPP likewise not real so let’s ask Josh why does nobody understand about the worker retention credit you know what’s intriguing you’re discussing the banks Kevin due to the fact that in the PPP loan procedure the federal government made it really clear that if you desired a PPP loan you would call Wells Fargo Citibank Bank of America any of the big 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 just procedure process that’s all um and here there was chaos due to the fact that keep in mind in the original cares act you could refrain from doing both programs so if you had actually done PPP you could refrain from doing ERC in the original program and when they altered the law in 2021 the banks were refraining from doing ERC since it’s not alone so you’re getting a tax refund so the government never ever made it clear to anyone about how to.
do this does your CFO understand how to do this not really he or she’s never ever done it previously 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 done this before unless you have an account that entered into this business and bottom line my company Kevin has stayed in business given that 2009 and we’ve been dealing with the federal government and the state federal government to recuperate money for Fortune 500 Fortune 1000 business so a lot of our huge huge corporate clients have dealt with bottom line to recover other federal government programs we have actually done sales tax and use tax joblessness tax work opportunity tax credits research and development tax credits unclaimed property property tax all of these other federal government programs.
The staff member retention tax credit is a broad based refundable tax credit created to motivate.
employers to keep staff members on their payroll. The credit is 50% of up to $10,000 in earnings paid by an.
Since of COVID-19 or whose gross invoices, company whose business is totally or partly suspended.
decline by more than 50%.
Availability.
1. The credit is readily available to all companies regardless of size consisting of tax exempt companies. There are.
only two exceptions: (1) state and city governments and their instrumentalities and (2) little.
businesses who take Small Business Loans.
2. To certify, the employer needs to satisfy one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the company’s organization is totally or partially suspended by federal government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross receipts are below 50% of the comparable quarter in 2019. Once the.
employer’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 quantity of the credit is 50% of the certifying incomes paid up to $10,000 in total.
It is effective for salaries paid after March 13th and before December 31, 2020.
The meaning of certifying incomes varies by whether a company had, typically, basically than.
100 workers in 2019.
Business that specialize in ERC filing assistance generally supply knowledge and assistance to help companies browse the complicated procedure of claiming the credit. They can use numerous services, including:.
How is the employee retention credit calculated? Employee Retention Credit Audit Period
Eligibility Evaluation: These business will examine your company’s eligibility for the ERC based on elements such as your market, income, and operations. If you satisfy the requirements for the credit and recognize the maximum credit quantity you can claim, they can help figure out.
Paperwork and Computation: ERC filing services will help in gathering the essential documentation, such as payroll records and monetary statements, to support your claim. They will also help determine the credit amount based on eligible incomes and other certifying expenditures.
Retroactive Claim Review: If you are qualified to claim the ERC for previous quarters, these companies can review your previous payroll records and financials to determine prospective opportunities for retroactive credits. They can assist you modify previous tax returns to claim these refunds.
Filing Help: Business specializing in ERC filings will prepare and send the essential types and documents on your behalf. This consists of finishing Kind 941 or any other necessary tax return.
Compliance and Updates: ERC policies and assistance have actually progressed in time. These business remain upgraded with the current modifications and make sure that your filings comply with the most existing guidelines. If the Internal revenue service demands extra details or conducts an audit associated to your ERC claim, they can likewise provide continuous support.
It is necessary to research study and vet any business using ERC filing support to guarantee their reliability and knowledge. Search for established companies with experience in tax and payroll services, or think about connecting to trusted accounting companies or tax specialists who offer ERC submitting support.
Remember that while these business can offer important help, it’s constantly an excellent idea to have a fundamental understanding of the ERC requirements and procedure yourself. This will help you make informed choices and make sure accurate filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit introduced by the U.S. federal government as part of COVID-19 relief procedures. The goal of the ERC is to motivate companies to maintain 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 offered to eligible companies, consisting of for-profit services, tax-exempt organizations, and particular governmental entities. To certify, employers need to satisfy one of two requirements:.
The business operations were totally or partly suspended due to a government order related to COVID-19.
The business experienced a substantial decline in gross invoices. As mentioned previously, 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 decline is specified as a 20% decrease in gross invoices compared to the exact same quarter in 2019, or a 20% decline in gross receipts compared to the instantly 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 (approximately 70%) of qualified incomes paid to staff members, including particular health plan expenditures. The optimum credit per worker is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, businesses that received a Paycheck Defense Program (PPP) loan were not qualified for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 enables businesses to declare the ERC even if they got a PPP loan. The very same earnings can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively broadened and boosted, enabling eligible employers to declare the credit for qualified incomes paid as far back as March 13, 2020. This retroactive arrangement provides an opportunity for businesses to modify prior-year income tax return and receive refunds.
Claiming the Credit: Companies can declare the ERC by reporting it on their employment income tax return, typically Form 941. The excess can be refunded to the employer if the credit exceeds the amount of work taxes owed.
It is very important to note that the ERC provisions and eligibility requirements have actually progressed with time. The very best course of action is to seek advice from a tax professional or visit the main internal revenue service website for the most updated and in-depth details concerning the ERC, consisting of any current legislative changes or updates.
To qualify for the ERC, a company must satisfy among the following criteria:.
Business operations were totally or partly suspended due to a government order related to COVID-19.
Business experienced a considerable decrease in gross receipts. For 2021, a significant decline is defined as a 20% decline in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a substantial decline is defined as a 20% decrease in gross invoices compared to the exact same quarter in 2019, or a 20% decline in gross receipts compared to the immediately preceding quarter.
The ERC is offered to businesses of all sizes, including tax-exempt organizations, however there are some exceptions. For example, government entities and businesses that received a PPP loan might have constraints on claiming the credit.
The procedure for claiming the ERC involves finishing the needed forms and including the credit on your work tax return (typically Kind 941). The exact time it takes to process the credit can differ based upon a number of elements, consisting of the complexity of your business and the work of the IRS. It’s recommended to talk to a tax expert for assistance specific to your scenario.
There are several business that can help with the procedure of claiming the ERC. These consist of accounting firms, tax advisory services, and payroll company. Some popular companies that provide help with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s advisable to research study and call these business straight to inquire about their services and costs.
Please keep in mind that the information supplied here is based upon basic knowledge and may not reflect the most recent updates or changes to the ERC. It’s important to consult with a tax professional or go to the official IRS site for the most current and accurate details concerning eligibility, declaring treatments, and available assistance.
Less than 100. The credit is based if the employer had 100 or fewer employees on average in 2019.
on wages paid to all workers whether they really worked or not. In other words, even if the.
employees 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 staff members usually in 2019, then the credit is.
allowed only for earnings paid to workers who did not work during the calendar quarter.
In both cases, “wages” consists of not simply money payments however also a portion of the cost of company.
provided health care. Employee Retention Credit Audit Period
Payment.
Employers can be instantly repaid for the credit by lowering the quantity of payroll taxes they.