Lets talk first about Employee Retention Credit Form 7200 :
Our group here what do these people doing everyone in this space is helping teach people about ERC and uh constantly supply a lovely breakfast and have people really find out about the program we ought to head to the space where we have the ability to show a few of the checks that we are getting for business and I want to see that what is this this is uh hundreds of millions of dollars literally Kevin hundreds of countless dollars so these are replicate copies of the letters that go to clients verifying that the check is on the method I suggest you know if you simply begin to take a look at some of these here I suggest this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I indicate it’s simply I imply consider the number of real clients 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 client so that’s how you’re able to track it you know when you
receive this you know the check is opted for sure which’s when they pay so they don’t pay anything up until they actually get the money they don’t pay bottom line Wonder trust anything up until this letter is verified the check is on the method they deposit it into their savings account and they can really trust Wonder trust that the process has actually been finished and how many you think you have actually processed since you began this we have to do with 35 000 of these for
about 6 billion dollars wow so plainly they understand what they’re doing and that’s what you require you require professionals 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 Wonderful here you’re at my YouTube channel we’re talking about something actually crucial today the worker retention credit which the majority of you have never become aware of I certainly had not heard of it till very just recently and discovered a lot about it due to the fact that this is probably the most affordable expense of capital for any small company anywhere
anytime if you have workers 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 challenging this isn’t like PPP we simply call 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 inform us all about it and how to get it and why I’ve become yes the Ambassador and paid representative for this I love this program it’s going away soon you got to find out everything about it let’s talk staff member retention credit Josh Fox what is an ERC let’s just start there so throughout the Trump Administration when President Trump was enacted they created the cares Act and the cares act provided companies three opportunities 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 two of them are loans and one’s a refund precisely so the ERC is a refund that’s.
fix the money money payroll tax refund all right go on sorry I just have to ensure we got that point I suggest that’s a big distinction a loan versus cash cash I like cash cash that’s what we’re talking about okay 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 gorgeous hard check in the mail where you get real cash from the IRS 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 staff member 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 shareholders it’s for workers right you needed to have owned a service however it’s based upon you having W-2 employees in America not 10.99. As long as you had W-2 employees 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 first 6 months of 2021 on the W-2 correct so there were six 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 2 and three of 2021. alright so that’s how it’s determined you need to be on the W-2 throughout that period now let’s talk my favorite part cash how much can you return per staff member that was on a W-2 in those 6 quarters so the computation in 2020 to be specific Kevin is 50 of the employee’s income to a maximum of five thousand dollars per worker for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the employee’s wage to a maximum of seven thousand per quarter how did that occur um they simply changed the rules in.
2021 versus because the mayhem 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 up to 5 thousand Max and after that what takes place 21 000 Max in 2021 oh that’s how you come up with twenty 6 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 great deal of money it is now there’s a caution here the PPP cash would need to be lowered from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan two you would decrease the 26 000 so what we’re seeing typically Kevin is if you took PPP money somewhere around 10 thousand dollars a person so let’s say hypothetically you owned a dining establishment 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 IRS so it’s substantial undoubtedly now the big question is why does no one learn about this because appearance when I first heard about this when I initially met Josh you know I have actually got lots of financial investments in lots of companies I’m a significant advocate for entrepreneurship in America and make many many investments in entrepreneurs of which many suffered through the pandemic when I first heard about this I called BS I do not believe it since I use 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 deserved and we utilized them wisely to survive throughout the pandemic so when I became aware of this I stated nah it can’t hold true however when I dug around I even called to my politician pals Guv Senators they didn’t learn about it I imply that’s how you understand that’s how misinformation is that there’s no information out there then a lot of individuals told me well you can’t get it due to the fact that you took the PPP also not real so let’s ask Josh why does no one understand about the employee retention credit you understand what’s intriguing you’re talking about the banks Kevin because in the PPP loan procedure the federal government made it very clear that if you wanted a PPP loan you would call Wells Fargo Citibank Bank of America any of the big 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 simply process procedure that’s all um and here there was turmoil due to the fact that keep in mind in the initial cares act you could not do both programs so if you had actually done PPP you could 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 federal government never ever made it clear to anyone about how to.
do this does your CFO understand how to do this not truly he or she’s never ever done it previously do the banks do it nope the banks do not do it the payroll companies yeah some of them are doing it as a payroll company your accountant no your accountant’s never ever done this before unless you have an account that went into this service and bottom line my company Kevin has actually been in business because 2009 and we’ve been dealing with the federal government and the state federal government to recover cash for Fortune 500 Fortune 1000 business so a lot of our big huge corporate customers have worked with bottom line to recover other federal government programs we’ve done sales tax and utilize tax joblessness tax work chance tax credits research and development tax credits unclaimed property real estate tax all of these other federal government programs.
The employee retention tax credit is a broad based refundable tax credit created to motivate.
companies to keep workers on their payroll. The credit is 50% of as much as $10,000 in incomes paid by an.
Because of COVID-19 or whose gross invoices, employer whose service is totally or partially suspended.
decline by more than 50%.
1. The credit is available to all employers despite size including tax exempt companies. There are.
just 2 exceptions: (1) state and city governments and their instrumentalities and (2) little.
services who take Small company Loans.
2. To qualify, the company has to meet one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the employer’s business is totally or partially suspended by government order due to COVID-19.
during the calendar quarter or.
o the company’s gross invoices are listed below 50% of the comparable quarter in 2019. When the.
company’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 amount of the credit is 50% of the qualifying wages paid up to $10,000 in overall.
It is effective for incomes paid after March 13th and before December 31, 2020.
The meaning of qualifying salaries varies by whether a company had, typically, more or less than.
100 workers in 2019.
Companies that specialize in ERC filing assistance usually offer expertise and support to assist services navigate the intricate procedure of claiming the credit. They can provide different services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit Form 7200
Eligibility Evaluation: These companies will examine your business’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 maximum credit amount you can claim, they can assist identify.
Documents and Computation: ERC filing services will help in collecting the necessary paperwork, such as payroll records and monetary declarations, to support your claim. They will likewise assist calculate the credit quantity based upon eligible earnings and other certifying expenses.
Retroactive Claim Evaluation: If you are qualified to claim the ERC for previous quarters, these companies can review your previous payroll records and financials to recognize prospective opportunities for retroactive credits. They can help you modify prior tax returns to claim these refunds.
Filing Help: Companies concentrating on ERC filings will prepare and submit the essential forms and paperwork in your place. This includes completing Form 941 or any other required tax return.
Compliance and Updates: ERC policies and assistance have progressed over time. These companies stay updated with the most recent modifications and guarantee that your filings adhere to the most present standards. They can likewise provide ongoing support if the IRS demands extra details or conducts an audit related to your ERC claim.
It’s important to research and vet any company offering ERC filing assistance to guarantee their reliability and competence. Search for recognized firms with experience in tax and payroll services, or think about connecting to relied on accounting companies or tax experts who offer ERC submitting support.
Keep in mind that while these companies can offer valuable support, it’s always a great concept to have a standard understanding of the ERC requirements and process yourself. This will assist you make informed decisions and make sure 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 maintain and pay their staff members during the pandemic, even if their operations have actually been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is readily available to qualified companies, consisting of for-profit businesses, tax-exempt organizations, and certain governmental entities. To qualify, companies must satisfy one of two requirements:.
The business operations were totally or partly suspended due to a federal government order related to COVID-19.
Business experienced a considerable decline in gross invoices. As pointed out previously, for 2021, a considerable decrease is defined as a 20% decrease in gross receipts compared to the very 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% decrease in gross invoices 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 is equal to a portion (as much as 70%) of qualified incomes paid to employees, including particular health plan costs. The optimum credit per staff member is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, services that received an Income Defense Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 enables organizations to claim the ERC even if they received a PPP loan. However, the very same salaries can not be used to claim 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 earnings paid as far back as March 13, 2020. This retroactive provision provides a chance for companies to change prior-year tax returns and get refunds.
Declaring the Credit: Employers can claim the ERC by reporting it on their work income tax return, normally Type 941. If the credit goes beyond the quantity of employment taxes owed, the excess can be reimbursed to the employer.
It is essential to note that the ERC provisions and eligibility requirements have progressed over time. The best course of action is to speak with a tax professional or check out the main internal revenue service website for the most detailed and current information regarding the ERC, including 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 completely or partly suspended due to a government order related to COVID-19.
The business experienced a substantial decline in gross invoices. For 2021, a significant decline is defined as a 20% decrease in gross receipts compared to the 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% decline in gross receipts compared to the immediately preceding quarter.
The ERC is readily available to services of all sizes, including tax-exempt organizations, but there are some exceptions. Government entities and businesses that received a PPP loan might have limitations on declaring the credit.
The procedure for claiming the ERC involves completing the essential kinds and including the credit on your employment tax return (usually Form 941). The exact time it requires to process the credit can vary based upon numerous factors, consisting of the complexity of your company and the work of the IRS. It’s suggested to talk to a tax expert for assistance particular to your circumstance.
There are numerous business that can help with the procedure of claiming the ERC. These consist of accounting firms, tax advisory services, and payroll provider. Some popular business that use support with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s advisable to research and call these business directly to inquire about their charges and services.
Please keep in mind that the information offered here is based upon general knowledge and might not show the most recent updates or changes to the ERC. It is essential to speak with a tax expert or visit the main IRS website for the most updated and precise details concerning eligibility, declaring treatments, and readily available help.
Less than 100. If the company had 100 or less workers typically in 2019, then the credit is based.
on incomes paid to all staff members whether they really worked or not. In other words, even if the.
employees worked full time and made 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.
enabled only for salaries paid to employees who did not work throughout the calendar quarter.
In both cases, “wages” includes not simply money payments however also a part of the cost of employer.
supplied health care. Employee Retention Credit Form 7200
Companies can be immediately compensated for the credit by decreasing the quantity of payroll taxes they.