Lets talk first about Employee Retention Credit Essential Business :
Our group here what do these guys doing everybody in this space is assisting teach people about ERC and uh constantly offer a gorgeous breakfast and have individuals actually discover the program we should head to the room where we are able to display some of the checks that we are getting for companies and I wish to see that what is this this is uh numerous millions of dollars actually Kevin numerous countless 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 simply 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 simply I suggest think of the number of actual 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 client so that’s how you have the ability to track it you understand when you
receive this you know the check is gone for sure which’s when they pay so they don’t pay anything till they in fact receive the money they don’t pay bottom line Wonder trust anything up until this letter is validated the check is on the method they transfer it into their checking account and they can truly trust Wonder trust that the procedure has been ended up and the number of you think you have actually processed because you started this we’re about 35 000 of these for
about 6 billion dollars wow so plainly they know what they’re doing and that’s what you need you require 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 Wonderful 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 heard of I definitely hadn’t heard of it until very just recently and found out a lot about it since this is probably the lowest expense of capital for any small business anywhere
anytime if you have employees in between 5 and five hundred so I have actually 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 just call up your bank manager and say offer me a loan it doesn’t work there’s not a loan it’s an application and Josh is going to tell 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 love this program it’s going away soon you got to discover all 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 created the cares Act and the cares act provided companies 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 huge distinction right there 2 of them are loans and one’s a refund precisely so the ERC is a refund that’s.
fix the money cash payroll tax refund okay go on sorry I just have to make sure we got that point I indicate that’s a huge difference a loan versus money cash I like money cash that’s what we’re discussing 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 original cares Act is the ERC and yes Kevin it is a beautiful tough check in the mail where you get real cash from the IRS 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 employee retention credit that person needed 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 shareholders it’s for workers right you had to have actually owned a business but 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 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 6 quarters so you had quarters two 3 and four of 2020 and you had quarters one 2 and three of 2021. all right so that’s how it’s measured you need to be on the W-2 throughout that duration now let’s talk my preferred part cash just how much can you return per employee that was on a W-2 in those six quarters so the calculation in 2020 to be exact Kevin is 50 of the employee’s income to an optimum of five thousand dollars per employee for the year of 2020 and in 2021 the numbers escalated to 70 of the employee’s salary to a maximum of seven thousand per quarter how did that happen um they simply changed the rules in.
2021 versus due to the fact that the mayhem 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 approximately 5 thousand Max and then 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 worker that is since that’s a lot of cash it is now there’s a caveat here the PPP cash would have to be decreased from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan two you would minimize the 26 000 so what we’re seeing typically Kevin is if you took PPP money someplace 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 money you would still get a million dollar in the mail from the internal revenue service so it’s big certainly now the big concern is why does nobody learn about this due to the fact that look when I first found out about this when I initially met Josh you know I’ve got great deals of investments in great deals of business I’m a significant advocate for entrepreneurship in America and make lots of many investments in business owners of which numerous suffered through the pandemic when I initially heard about this I called BS I don’t think it due to the fact that I use the PPP we went through the money center Banks to get it it was very easy to do we had our CEOs call the banks they got their loans which were well been worthy of and we utilized them carefully to stay alive during the pandemic so when I became aware of this I said nah it can’t be true however when I dug around I even called to my political leader good friends Guv Senators they didn’t understand about it I suggest that’s how you understand that’s how misinformation is that there’s no information out there then a bunch of individuals informed me well you can’t get it since you took the PPP likewise not true so let’s ask Josh why does no one learn about the worker retention credit you understand what’s fascinating you’re speaking about the banks Kevin because in the PPP loan process the federal government made it extremely 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 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 turmoil due to the fact that remember in the original cares act you might refrain from doing both programs so if you had done PPP you might not do ERC in the original program and when they altered the law in 2021 the banks were not doing ERC because it’s not alone so you’re getting a tax refund so the government never made it clear to any person about how to.
do this does your CFO know how to do this not really he or she’s never done it in the past 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 accountant no your accountant’s never done this before unless you have an account that went into this service and bottom line my company Kevin has actually been in business since 2009 and we have actually been dealing with the federal government and the state government to recover money for Fortune 500 Fortune 1000 companies so a great deal of our huge big corporate customers have actually worked with bottom line to recover other government programs we’ve done sales tax and utilize tax joblessness tax work opportunity tax credits research and development tax credits unclaimed home property tax all of these other government programs.
The employee retention tax credit is a broad based refundable tax credit developed to encourage.
employers to keep workers on their payroll. The credit is 50% of as much as $10,000 in salaries paid by an.
Since of COVID-19 or whose gross receipts, company whose service is fully or partly suspended.
decrease by more than 50%.
1. The credit is readily available to all employers despite size including 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 company needs to meet one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the company’s organization is totally or partly 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 similar quarter in 2019. When the.
employer’s gross receipts exceed 80% of a comparable quarter in 2019 they no longer qualify.
after completion of that quarter.
Calculation of the Credit.
The quantity of the credit is 50% of the certifying earnings paid up to $10,000 in overall.
It works for incomes paid after March 13th and before December 31, 2020.
The definition of certifying wages varies by whether an employer had, on average, basically than.
100 staff members in 2019.
Business that specialize in ERC filing assistance typically provide knowledge and assistance to assist companies navigate the complex process of declaring the credit. They can provide different services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit Essential Business
Eligibility Assessment: These business will examine your service’s eligibility for the ERC based upon elements such as your industry, income, and operations. If you fulfill the requirements for the credit and recognize the maximum credit quantity you can declare, they can assist figure out.
Documentation and Estimation: ERC filing services will assist in collecting the necessary documents, such as payroll records and monetary statements, to support your claim. They will likewise help calculate the credit quantity based upon eligible salaries and other qualifying expenditures.
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 identify potential chances for retroactive credits. They can help you change prior tax returns to declare these refunds.
Filing Help: Business specializing in ERC filings will prepare and send the necessary kinds and documentation in your place. This includes completing Form 941 or any other necessary tax return.
Compliance and Updates: ERC policies and guidance have developed gradually. These business remain upgraded with the most recent changes and make sure that your filings abide by the most existing guidelines. They can also provide continuous support if the internal revenue service demands extra details or performs an audit related to your ERC claim.
It is essential to research study and veterinarian any company using ERC filing support to guarantee their trustworthiness and proficiency. Try to find established companies with experience in tax and payroll services, or consider connecting to relied on accounting companies or tax professionals who offer ERC filing support.
Remember that while these business can offer important help, it’s constantly a great idea to have a standard understanding of the ERC requirements and process yourself. This will assist you make notified decisions and ensure accurate filings.
The Employee Retention Credit (ERC) is a refundable tax credit presented 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 staff members throughout the pandemic, even if their operations have actually been affected.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is available to qualified companies, consisting of for-profit companies, tax-exempt organizations, and particular governmental entities. To qualify, companies need to fulfill one of two criteria:.
The business operations were totally or partially suspended due to a federal government order related to COVID-19.
The business experienced a considerable decrease in gross invoices. As mentioned earlier, for 2021, a significant decrease is specified as a 20% decline 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 invoices compared to the 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 company’s share of Social Security taxes. The credit quantity is equal to a percentage (as much as 70%) of certified salaries paid to staff members, consisting of specific health plan costs. The optimum credit per worker is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: At first, services that received a Paycheck Defense Program (PPP) loan were not eligible for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 enables services to claim the ERC even if they received a PPP loan. The exact same salaries can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has actually been retroactively broadened and enhanced, permitting eligible employers to declare the credit for certified salaries paid as far back as March 13, 2020. This retroactive arrangement offers a chance for companies to change prior-year income tax return and get refunds.
Declaring the Credit: Employers can declare the ERC by reporting it on their work income tax return, generally Type 941. If the credit goes beyond the amount of work taxes owed, the excess can be reimbursed to the company.
It is very important to keep in mind that the ERC provisions and eligibility criteria have evolved gradually. The best strategy is to consult with a tax expert or go to the main IRS website for the most detailed and up-to-date information relating to the ERC, consisting of any recent legislative changes or updates.
To get approved for the ERC, an organization must satisfy among the following requirements:.
The business operations were fully or partly suspended due to a government order related to COVID-19.
Business experienced a considerable decline in gross receipts. For 2021, a substantial decline is specified as a 20% decline in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a considerable decrease is defined 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 instantly preceding quarter.
The ERC is available to businesses of all sizes, including tax-exempt organizations, however there are some exceptions. Government entities and companies that received a PPP loan may have restrictions on declaring the credit.
The procedure for declaring the ERC includes finishing the required types and including the credit on your work tax return (typically Form 941). The exact time it requires to process the credit can differ based on a number of factors, including the intricacy of your business and the work of the internal revenue service. It’s recommended to talk to a tax expert for guidance particular to your situation.
There are numerous business that can help with the process of declaring the ERC. These include accounting companies, tax advisory services, and payroll provider. Some popular business that provide help with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s recommended to research and call these business straight to ask about their charges and services.
Please keep in mind that the details provided here is based upon basic understanding and may not reflect the most current updates or modifications to the ERC. It is necessary to talk to a tax expert or check out the main internal revenue service website for the most accurate and current details regarding eligibility, claiming treatments, and available assistance.
Less than 100. If the employer had 100 or fewer staff members on average in 2019, then the credit is based.
on incomes paid to all staff members whether they in fact worked or not. In other words, even if the.
staff members worked full-time and earned money 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 just for earnings paid to employees who did not work throughout the calendar quarter.
In both cases, “earnings” consists of not simply cash payments but likewise a portion of the expense of company.
supplied health care. Employee Retention Credit Essential Business
Companies can be instantly repaid for the credit by minimizing the amount of payroll taxes they.