Lets talk first about Employee Retention Credit Full Time Equivalent :
Our group here what do these men doing everyone in this room is helping teach people about ERC and uh constantly provide a gorgeous breakfast and have individuals actually discover the program we need 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 wish to see that what is this this is uh hundreds of countless dollars actually Kevin numerous millions of dollars so these are duplicate copies of the letters that go to customers confirming that the check is on the way I imply you understand if you simply start to 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 mean it’s just I imply consider how many actual 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 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 know the check is gone for sure which’s when they pay so they don’t pay anything up until they really receive the money they do not pay bottom line Wonder trust anything up until this letter is confirmed the check is on the way they deposit it into their checking account and they can truly rely on Wonder trust that the process has actually 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 six billion dollars wow so clearly they understand what they’re doing and that’s what you require you need specialists 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 truly crucial today the employee retention credit which most of you have never heard of I certainly had not become aware of it until extremely just recently and discovered a lot about it due to the fact that this is probably the lowest cost of capital for any small company anywhere
anytime if you have employees between 5 and five hundred so I have actually got the expert 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 hard this isn’t like PPP we just call your bank supervisor 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 all of us about it and how to get it and why I have actually ended up being yes the Ambassador and paid spokesperson for this I like this program it’s going away soon you got to discover all about it let’s talk employee retention credit Josh Fox what is an ERC let’s simply begin there so throughout the Trump Administration when President Trump was enacted they came up with the cares Act and the cares act used businesses three chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly everyone it makes a big difference right there two 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 need to make sure we got that point I indicate that’s a big distinction a loan versus cash money I like money money that’s what we’re talking about 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 initial cares Act is the ERC and yes Kevin it is a stunning hard check in the mail where you get real money from the IRS all right so let’s talk about how it works since it seems like to me if it’s a if it’s employee retention credit that person needed to be a staff member so I’m going to make the Assumption this money 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 but it’s based upon you having W-2 employees in America not 10.99. so as long as you had W-2 workers and you paid federal payroll taxes that’s why you would be eligible so you need 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 right 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. alright so that’s how it’s determined you have to be on the W-2 throughout that duration now let’s talk my preferred part cash just how much can you get back per worker that was on a W-2 in those six quarters so the calculation in 2020 to be specific Kevin is 50 of the staff member’s salary to a maximum of 5 thousand dollars per employee for the year of 2020 and in 2021 the numbers increased to 70 of the staff member’s wage to an optimum of 7 thousand per quarter how did that take place um they just changed the rules in.
2021 versus due to the fact that the chaos of the pandemic so they wanted to even get more to keep those employees on payroll 100 so if you can get 5 000 per person Max in twenty that was 50 in 2020 as much as five thousand Max and after that what occurs 21 000 Max in 2021 oh that’s how you create twenty six thousand twenty one thousand to twenty twenty one plus five thousand in twenty twenty that’s twenty 6 thousand dollars per worker that is since that’s a great deal of money it is now there’s a caution here the PPP money would have to be minimized from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan 2 you would decrease the 26 000 so what we’re seeing on average Kevin is if you took PPP cash somewhere around ten 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 workers and you took PPP cash you would still get a million dollar in the mail from the IRS so it’s substantial obviously now the big question is why does nobody know about this since look when I first heard about this when I initially met Josh you know I have actually got great deals of investments in lots of business I’m a major supporter for entrepreneurship in America and make lots of lots of investments in entrepreneurs of which numerous suffered through the pandemic when I first heard about this I called BS I don’t believe it because I use the PPP we went through the cash 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 wisely to survive throughout the pandemic so when I found out about this I said nah it can’t hold true but when I dug around I even called to my political leader pals Guv Senators they didn’t know about it I imply that’s how you know that’s how false information is that there’s no details out there then a lot of individuals told 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 understand what’s intriguing you’re speaking about the banks Kevin due to the fact that in the PPP loan process the federal government made it extremely clear that if you wanted a PPP loan you would call Wells Fargo Citibank Bank of America any of the huge banks in our country and they would process procedure in Canada a pre-pp loan there’s no loans in Canada by the way it’s simply process process that’s all um and here there was chaos due to the fact that remember in the original cares act you might not do both programs so if you had actually done PPP you could not do ERC in the original program and when they changed the law in 2021 the banks were refraining from doing ERC because it’s not alone so you’re getting a tax refund so the federal government never made it clear to anyone about how to.
do this does your CFO understand how to do this not really she or he’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 business your accounting professional no your accountant’s never done this prior to 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 have actually been dealing with the federal government and the state government to recover cash for Fortune 500 Fortune 1000 companies so a great deal of our big huge corporate clients have actually dealt with bottom line to recuperate other federal government programs we’ve done sales tax and use tax unemployment tax work chance 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.
companies to keep staff members on their payroll. The credit is 50% of up to $10,000 in wages paid by an.
Due to the fact that of COVID-19 or whose gross invoices, employer whose organization is fully or partly suspended.
decline by more than 50%.
1. The credit is offered to all companies no matter size including tax exempt organizations. There are.
just 2 exceptions: (1) state and city governments and their instrumentalities and (2) small.
companies who take Small Business Loans.
2. To certify, the company has to satisfy one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the employer’s business is fully or partly suspended by federal government order due to COVID-19.
during the calendar quarter or.
o the company’s gross invoices are below 50% of the equivalent quarter in 2019. As soon as the.
employer’s gross receipts go above 80% of a comparable 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 salaries paid after March 13th and prior to December 31, 2020.
The meaning of qualifying salaries differs by whether a company had, on average, basically than.
100 employees in 2019.
Companies that specialize in ERC filing help normally provide competence and support to assist companies navigate the complicated procedure of claiming the credit. They can use different services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit Full Time Equivalent
Eligibility Evaluation: These companies will assess your company’s eligibility for the ERC based on factors such as your market, revenue, and operations. If you satisfy the requirements for the credit and identify the optimum credit amount you can claim, they can help determine.
Documentation and Estimation: ERC filing services will assist in gathering the necessary documents, such as payroll records and monetary statements, to support your claim. They will also assist determine the credit quantity based on qualified salaries and other qualifying costs.
Retroactive Claim Evaluation: If you are qualified to claim the ERC for prior quarters, these companies can evaluate your previous payroll records and financials to identify prospective chances for retroactive credits. They can assist you amend previous tax returns to declare these refunds.
Filing Help: Business specializing in ERC filings will prepare and send the required forms and paperwork on your behalf. This includes finishing Type 941 or any other necessary tax forms.
Compliance and Updates: ERC policies and assistance have actually developed gradually. These business stay updated with the current changes and ensure that your filings comply with the most present standards. They can likewise supply ongoing assistance if the internal revenue service requests additional details or performs an audit related to your ERC claim.
It is necessary to research study and veterinarian any business using ERC filing support to ensure their trustworthiness and know-how. Search for recognized companies with experience in tax and payroll services, or think about connecting to relied on accounting firms or tax professionals who use ERC filing support.
Bear in mind that while these companies can supply important support, it’s constantly a great idea to have a basic understanding of the ERC requirements and process yourself. This will help you make notified choices and make sure precise 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 objective of the ERC is to encourage organizations to keep and pay their workers during the pandemic, even if their operations have actually been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is available to qualified companies, consisting of for-profit services, tax-exempt organizations, and specific governmental entities. To certify, companies must satisfy one of two requirements:.
Business operations were completely or partly suspended due to a government order related to COVID-19.
The business experienced a significant decline in gross invoices. As mentioned previously, for 2021, a considerable decline is specified as a 20% decline in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a considerable decline is defined as a 20% decline in gross invoices compared to the same quarter in 2019, or a 20% decline in gross invoices compared to the immediately preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit amount amounts to a percentage (approximately 70%) of certified salaries paid to employees, consisting of specific health insurance 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, businesses that got a Paycheck Security Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 allows services to claim the ERC even if they got a PPP loan. However, the very same earnings can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has actually been retroactively expanded and enhanced, enabling eligible employers to declare the credit for certified salaries paid as far back as March 13, 2020. This retroactive provision supplies an opportunity for businesses to change prior-year income tax return and get refunds.
Declaring the Credit: Companies can claim the ERC by reporting it on their employment income tax return, typically Kind 941. If the credit surpasses the amount of employment taxes owed, the excess can be refunded to the company.
It is necessary to keep in mind that the ERC provisions and eligibility requirements have actually evolved with time. The very best course of action is to speak with a tax professional or go to the official IRS site for the most current and detailed info relating to the ERC, consisting of any recent legislative changes or updates.
To receive the ERC, a business should satisfy among the following criteria:.
Business operations were completely or partly suspended due to a government order related to COVID-19.
Business experienced a significant decline in gross invoices. For 2021, a substantial decrease is specified as a 20% decrease in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a substantial decline is specified as a 20% decrease in gross receipts compared to the same quarter in 2019, or a 20% decline in gross invoices compared to the immediately preceding quarter.
The ERC is available to organizations of all sizes, including tax-exempt companies, but there are some exceptions. For instance, federal government entities and services that received a PPP loan might have constraints on claiming the credit.
The procedure for claiming the ERC includes finishing the needed types and consisting of the credit on your work tax return (typically Form 941). The exact time it takes to process the credit can vary based upon several aspects, consisting of the complexity of your business and the workload of the internal revenue service. It’s suggested to consult with a tax professional for assistance specific to your situation.
There are several business that can assist with the procedure of claiming the ERC. These include accounting firms, tax advisory services, and payroll provider. Some popular companies that use help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s suggested to research study and call these companies directly to ask about their costs and services.
Please note that the info offered here is based on general understanding and may not reflect the most current updates or modifications to the ERC. It is very important to talk to a tax expert or go to the main internal revenue service site for the most precise and current details concerning eligibility, claiming treatments, and available support.
Less than 100. If the company had 100 or less employees on average in 2019, then the credit is based.
on earnings paid to all workers whether they really worked or not. Simply put, even if the.
employees worked full time and got paid for full time work, the employer still gets the credit.
Greater than 100. If the employer had more than 100 workers usually in 2019, then the credit is.
allowed just for wages paid to employees who did not work during the calendar quarter.
In both cases, “earnings” consists of not simply cash payments however likewise a portion of the cost of company.
provided health care. Employee Retention Credit Full Time Equivalent
Companies can be immediately repaid for the credit by reducing the amount of payroll taxes they.