Lets talk first about Employee Retention Credit For 3Rd Quarter 2021 :
Our team here what do these men doing everyone in this room is assisting teach individuals about ERC and uh always provide a gorgeous breakfast and have individuals really find out about the program we must head to the room where we have the ability to display some of the checks that we are getting for companies and I wish to see that what is this this is uh hundreds of millions of dollars actually Kevin hundreds of millions of dollars so these are replicate copies of the letters that go to clients confirming that the check is on the method I suggest you understand if you simply begin to take a look at a few 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 party at the end when the check is confirmed the numbers are validated and the check is on the mail in the mail from the internal revenue service heading to the consumer so that’s how you have the ability to track it you understand when you
get this you know the check is chosen sure and that’s when they pay so they do not pay anything up until 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 savings account and they can genuinely rely on Wonder trust that the process has been ended up and how many you think you have actually processed considering that you began this we’re about 35 000 of these for
about 6 billion dollars wow so plainly they know what they’re doing which’s what you require 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 Terrific here you’re at my YouTube channel we’re discussing something actually crucial today the employee retention credit which the majority of you have actually never ever become aware of I certainly had not heard of it up until really recently and found out a lot about it since this is probably the lowest cost of capital for any small company anywhere
anytime if you have staff members 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 Principles they’re the biggest processor of these ERC credits this is a 170 page program so it’s hard this isn’t like PPP we simply contact your bank supervisor and say 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 like this program it’s disappearing soon you got to discover everything about it let’s talk worker retention credit Josh Fox what is an ERC let’s just begin there so throughout the Trump Administration when President Trump was enacted they developed the cares Act and the cares act used services 3 chances 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 exactly so the ERC is a refund that’s.
fix the cash money payroll tax refund okay go on sorry I just have to ensure we got that point I suggest that’s a big distinction a loan versus money money I like money cash 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 stunning difficult check in the mail where you get actual money from the internal revenue service all right so let’s talk about how it works because it sounds like to me if it’s a if it’s worker retention credit that individual needed to be an employee so I’m going to make the Presumption this cash is not for the owner not for people on the cap table not for investors it’s for employees right you needed to have actually owned a company 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 eligible so you have to be on payroll in 2020 on the W-2 and you have to be on payroll for the 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 3 and four of 2020 and you had quarters one two and three of 2021. fine 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 return per employee that was on a W-2 in those six quarters so the computation in 2020 to be precise Kevin is 50 of the staff member’s income to an optimum of 5 thousand dollars per employee for the year of 2020 and in 2021 the numbers increased to 70 of the staff member’s income to a maximum of seven thousand per quarter how did that happen um they just changed the rules in.
2021 versus because 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 takes place 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 employee that is since that’s a lot of cash it is now there’s a caveat here the PPP cash would need to be decreased 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 cash someplace around 10 thousand dollars an individual so let’s state hypothetically you owned a dining establishment in New York 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 internal revenue service so it’s big certainly now the huge question is why does no one know about this due to the fact that look when I initially heard about this when I initially met Josh you know I’ve got great deals of financial investments in great deals of business I’m a significant supporter for entrepreneurship in America and make many numerous financial investments in business owners of which many suffered through the pandemic when I initially became aware of this I called BS I don’t 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 which were well been worthy of and we utilized them wisely to stay alive throughout the pandemic so when I became aware of this I said nah it can’t be true but when I dug around I even called to my political leader buddies Governor Senators they didn’t learn about it I indicate that’s how you understand that’s how false information is that there’s no information out there then a lot of individuals told me well you can’t get it because you took the PPP likewise not true so let’s ask Josh why does no one understand about the worker retention credit you understand what’s intriguing you’re discussing the banks Kevin since in the PPP loan process 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 huge 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 process process that’s all um and here there was turmoil due to the fact that remember in the initial cares act you might not do both programs so if you had done PPP you could refrain from doing ERC in the initial program and when they changed 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 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 some of them are doing it as a payroll company your accounting professional no your accounting professional’s never done this before unless you have an account that went into this organization and bottom line my firm Kevin has stayed in business because 2009 and we have actually been working with the federal government and the state government to recover cash for Fortune 500 Fortune 1000 business so a lot of our huge huge corporate clients have worked with bottom line to recuperate other government programs we have actually done sales tax and utilize tax unemployment tax work opportunity tax credits research and development tax credits unclaimed home property tax all of these other federal government programs.
The employee retention tax credit is a broad based refundable tax credit developed to encourage.
companies to keep workers on their payroll. The credit is 50% of up to $10,000 in incomes paid by an.
Since of COVID-19 or whose gross receipts, employer whose business is totally or partly suspended.
decline by more than 50%.
1. The credit is readily available to all companies regardless of size consisting of tax exempt organizations. There are.
only 2 exceptions: (1) state and local governments and their instrumentalities and (2) small.
companies who take Small Business Loans.
2. To certify, the employer needs to meet one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the employer’s organization is totally or partially suspended by government order due to COVID-19.
during the calendar quarter or.
o the company’s gross receipts are below 50% of the equivalent quarter in 2019. Once the.
employer’s gross receipts exceed 80% of an equivalent quarter in 2019 they no longer qualify.
after the end of that quarter.
Calculation of the Credit.
The quantity of the credit is 50% of the certifying earnings paid up to $10,000 in total.
It works for earnings paid after March 13th and before December 31, 2020.
The meaning of certifying salaries differs by whether a company had, typically, basically than.
100 workers in 2019.
Business that focus on ERC filing help usually provide proficiency and support to help organizations browse the complex process of declaring the credit. They can use numerous services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit For 3Rd Quarter 2021
Eligibility Evaluation: These business will examine your service’s eligibility for the ERC based on aspects such as your industry, earnings, and operations. If you meet the requirements for the credit and determine the optimum credit amount you can claim, they can assist determine.
Documentation and Estimation: ERC filing services will assist in collecting the required documents, such as payroll records and monetary statements, to support your claim. They will likewise help determine the credit quantity based upon qualified salaries and other qualifying expenses.
Retroactive Claim Review: If you are eligible to claim the ERC for prior quarters, these companies can examine your previous payroll records and financials to identify potential opportunities for retroactive credits. They can help you amend previous tax returns to claim these refunds.
Filing Assistance: Companies specializing in ERC filings will prepare and submit the necessary kinds and paperwork on your behalf. This consists of completing Kind 941 or any other required tax forms.
Compliance and Updates: ERC regulations and assistance have evolved gradually. These companies remain updated with the latest modifications and guarantee that your filings abide by the most current standards. They can also provide continuous assistance if the internal revenue service requests extra info or performs an audit related to your ERC claim.
It is necessary to research and veterinarian any company providing ERC filing help to guarantee their credibility and expertise. Try to find recognized companies with experience in tax and payroll services, or consider reaching out to relied on accounting companies or tax professionals who offer ERC submitting support.
Remember that while these companies can provide valuable help, it’s always a good idea to have a fundamental understanding of the ERC requirements and procedure yourself. This will help you make informed decisions and guarantee accurate filings.
The Employee Retention Credit (ERC) is a refundable tax credit presented by the U.S. government as part of COVID-19 relief measures. The objective of the ERC is to encourage services to retain and pay their workers throughout the pandemic, even if their operations have been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is offered to eligible employers, consisting of for-profit companies, tax-exempt companies, and specific governmental entities. To qualify, companies must satisfy one of two criteria:.
The business operations were fully or partly suspended due to a government order related to COVID-19.
Business experienced a significant decline in gross invoices. As discussed previously, for 2021, a significant decline is defined as a 20% decline in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a considerable decline is defined as a 20% decrease in gross invoices compared to the same quarter in 2019, or a 20% decrease in gross receipts compared to the immediately preceding quarter.
Credit Amount: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit quantity amounts to a portion (as much as 70%) of certified incomes paid to workers, including specific health plan expenses. 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 got a Paycheck Security Program (PPP) loan were not eligible for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 enables organizations to declare the ERC even if they received a PPP loan. The very same wages can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively broadened and enhanced, enabling eligible employers to claim the credit for certified incomes paid as far back as March 13, 2020. This retroactive provision provides a chance for companies to modify prior-year tax returns and get refunds.
Claiming the Credit: Companies can claim the ERC by reporting it on their employment tax returns, usually Form 941. The excess can be reimbursed to the company if the credit goes beyond the amount of employment taxes owed.
It is very important to keep in mind that the ERC arrangements and eligibility requirements have actually developed in time. The best course of action is to speak with a tax professional or visit the official IRS website for the most updated and in-depth details regarding the ERC, consisting of any recent legal changes or updates.
To qualify for the ERC, a service needs to satisfy one of the following criteria:.
The business operations were fully or partially suspended due to a federal government order related to COVID-19.
Business experienced a significant decrease in gross invoices. For 2021, a considerable decline is defined as a 20% decline 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 exact same quarter in 2019, or a 20% decline in gross receipts compared to the instantly preceding quarter.
The ERC is available to organizations of all sizes, consisting of tax-exempt companies, however there are some exceptions. For example, federal government entities and organizations that got a PPP loan may have restrictions on claiming the credit.
The process for claiming the ERC involves completing the essential kinds and consisting of the credit on your employment tax return (generally Form 941). The exact time it requires to process the credit can vary based upon numerous aspects, consisting of the complexity of your business and the workload of the IRS. It’s advised to consult with a tax expert for assistance specific to your scenario.
There are a number of business that can aid with the process of declaring the ERC. These include accounting companies, tax advisory services, and payroll service providers. Some popular companies that provide assistance with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s recommended to research and get in touch with these companies straight to ask about their services and charges.
Please note that the info supplied here is based on basic understanding and might not reflect the most recent updates or changes to the ERC. It is necessary to speak with a tax expert or go to the official IRS site for the most up-to-date and accurate info concerning eligibility, claiming treatments, and offered help.
Less than 100. If the company had 100 or less staff members usually in 2019, then the credit is based.
on wages paid to all employees whether they actually worked or not. To put it simply, even if the.
employees worked full-time and earned money for full-time work, the employer still gets the credit.
Greater than 100. The credit is if the company had more than 100 staff members on average in 2019.
permitted just for salaries paid to workers who did not work throughout the calendar quarter.
In both cases, “earnings” consists of not just cash payments however also a portion of the cost of company.
supplied health care. Employee Retention Credit For 3Rd Quarter 2021
Employers can be immediately compensated for the credit by lowering the amount of payroll taxes they.