Lets talk first about Employee Retention Credit If You Get Ppp :
Our team here what do these people doing everybody in this room is helping teach people about ERC and uh always supply a gorgeous breakfast and have people really learn about the program we should head to the room where we have the ability to show a few of the checks that we are getting for business and I ‘d like to see that what is this this is uh hundreds of countless dollars actually Kevin numerous countless dollars so these are replicate copies of the letters that go to clients confirming that the check is on the method I indicate 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 the number of real customers that went through the program yeah this is the very end this is the celebration at the end when the check is validated the numbers are validated and the check is on the mail in the mail from the internal revenue service heading to the customer so that’s how you’re able to track it you understand when you
get this you understand the check is opted for sure which’s when they pay so they do not pay anything until they really receive the cash they do not pay bottom line Wonder trust anything till this letter is verified the check is on the method they deposit it into their checking account and they can truly trust Wonder trust that the process has been finished and the number of you believe you’ve 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 and that’s what you need you need experts 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 talking about something truly important today the staff member retention credit which the majority of you have actually never heard of I definitely had not heard of it until very recently and discovered a lot about it since this is most likely the lowest cost of capital for any small business anywhere
anytime if you have workers in between 5 and five hundred so I’ve got the expert with me this is Josh Fox he’s the creator and CEO of bottom line Principles they’re the largest processor of these ERC credits this is a 170 page program so it’s difficult this isn’t like PPP we simply contact 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 inform all of us about it and how to get it and why I’ve ended up being yes the Ambassador and paid representative for this I love this program it’s disappearing soon you got to learn all about it let’s talk staff member retention credit Josh Fox what is an ERC let’s simply start there so throughout the Trump Administration when President Trump was enacted they came up with the cares Act and the cares act offered organizations three opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly everybody it makes a big difference right there two of them are loans and one’s a refund precisely so the ERC is a refund that’s.
remedy the money money payroll tax refund alright go on sorry I just have to make sure we got that point I imply that’s a huge distinction a loan versus cash cash I like cash money 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 original cares Act is the ERC and yes Kevin it is a beautiful difficult check in the mail where you get real money from the internal revenue service all right so let’s talk about how it works since it sounds like to me if it’s a if it’s staff member retention credit that person had to be a worker so I’m going to make the Presumption this cash is not for the owner not for individuals on the cap table not for shareholders it’s for staff members right you needed to have actually owned a service but it’s based upon you having W-2 staff members 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 six quarters so you had quarters two 3 and 4 of 2020 and you had quarters one two and three of 2021. all right so that’s how it’s determined you need to be on the W-2 throughout that duration now let’s talk my favorite part cash how much can you return per staff member 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 income to a maximum of 5 thousand dollars per employee for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the staff member’s wage to a maximum of seven 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 five thousand Max and after that 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 six thousand dollars per employee that is since that’s a lot of money it is now there’s a caution here the PPP cash would have to be minimized from the twenty six 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 money someplace around ten 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 workers and you took PPP money you would still get a million dollar in the mail from the internal revenue service so it’s huge undoubtedly now the big question is why does no one understand about this because look when I first became aware of this when I first fulfilled Josh you understand I’ve got lots of investments in lots of business I’m a significant supporter for entrepreneurship in America and make many many financial investments in business owners of which numerous suffered through the pandemic when I first heard about this I called BS I do not think it due to the fact that 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 carefully to stay alive during the pandemic so when I heard about this I stated nah it can’t be true however when I dug around I even called to my politician friends Guv Senators they didn’t understand about it I imply that’s how you know that’s how misinformation is that there’s no details out there then a lot of people informed me well you can’t get it because you took the PPP likewise not real so let’s ask Josh why does no one understand about the staff member retention credit you know what’s fascinating you’re discussing the banks Kevin due to the fact that 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 country and they would process procedure in Canada a pre-pp loan there’s no loans in Canada by the way it’s just procedure procedure that’s all um and here there was mayhem because remember in the original cares act you might refrain from doing both programs so if you had actually done PPP you might refrain from doing ERC in the original program and when they altered the law in 2021 the banks were refraining from doing ERC due to the fact that 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 know how to do this not really she or he’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 accounting professional no your accountant’s never ever done this prior to unless you have an account that entered into this business and bottom line my company Kevin has been in business considering that 2009 and we’ve been working with the federal government and the state government to recover money for Fortune 500 Fortune 1000 companies so a lot of our huge huge corporate customers have dealt with bottom line to recover other federal government programs we have actually done sales tax and utilize tax joblessness tax work chance tax credits research and development tax credits unclaimed property property tax all of these other government programs.
The worker retention tax credit is a broad based refundable tax credit created to motivate.
companies to keep employees on their payroll. The credit is 50% of up to $10,000 in incomes paid by an.
company whose organization is fully or partly suspended because of COVID-19 or whose gross invoices.
decline by more than 50%.
1. The credit is readily available to all employers regardless of size consisting of tax exempt companies. There are.
only 2 exceptions: (1) state and local governments and their instrumentalities and (2) small.
services who take Small Business Loans.
2. To certify, the company needs to fulfill one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the company’s organization is fully or partly suspended by government order due to COVID-19.
throughout the calendar quarter or.
o the employer’s gross invoices are listed below 50% of the equivalent quarter in 2019. As soon as the.
company’s gross invoices go above 80% of a comparable quarter in 2019 they no longer certify.
after the end of that quarter.
Computation 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 wages paid after March 13th and before December 31, 2020.
The definition of certifying wages varies by whether an employer had, typically, more or less than.
100 employees in 2019.
Companies that specialize in ERC filing support usually supply competence and assistance to help companies navigate the complex process of declaring the credit. They can provide various services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit If You Get Ppp
Eligibility Assessment: These companies will assess your company’s eligibility for the ERC based on elements such as your industry, income, and operations. They can assist figure out if you fulfill the requirements for the credit and determine the maximum credit quantity you can claim.
Paperwork and Calculation: ERC filing services will assist in gathering the required documents, such as payroll records and financial declarations, to support your claim. They will likewise help compute the credit quantity based upon eligible wages 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 prospective chances for retroactive credits. They can assist you modify prior income tax return to declare these refunds.
Filing Assistance: Business concentrating on ERC filings will prepare and send the needed types and documentation on your behalf. This consists of finishing Kind 941 or any other required tax forms.
Compliance and Updates: ERC policies and guidance have progressed gradually. These companies remain updated with the most recent modifications and guarantee that your filings adhere to the most current standards. They can likewise offer ongoing assistance if the internal revenue service requests additional details or performs an audit related to your ERC claim.
It’s important to research and vet any business using ERC filing help to ensure their credibility and proficiency. Search for recognized firms with experience in tax and payroll services, or consider reaching out to relied on accounting firms or tax professionals who offer ERC filing support.
Keep in mind that while these companies can supply valuable help, it’s constantly a great concept to have a basic understanding of the ERC requirements and process yourself. This will help you make informed decisions and guarantee precise filings.
The Worker Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief measures. The goal of the ERC is to motivate organizations to keep and pay their staff members throughout the pandemic, even if their operations have actually been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is available to qualified companies, including for-profit businesses, tax-exempt organizations, and particular governmental entities. To qualify, companies need to fulfill one of two criteria:.
The business operations were totally or partly suspended due to a federal government order related to COVID-19.
Business experienced a substantial decrease in gross receipts. As pointed out previously, for 2021, a significant decrease is defined as a 20% decrease in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a significant decline is defined as a 20% decline in gross invoices compared to the very same quarter in 2019, or a 20% decrease in gross receipts 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 quantity amounts to a portion (approximately 70%) of certified wages paid to employees, including particular health plan expenses. The maximum credit per employee 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 Protection Program (PPP) loan were not qualified for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 enables businesses to claim the ERC even if they received a PPP loan. However, the exact same wages can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively broadened and improved, permitting qualified companies to claim the credit for qualified incomes paid as far back as March 13, 2020. This retroactive arrangement provides an opportunity for companies to amend prior-year tax returns and receive refunds.
Claiming the Credit: Employers can claim the ERC by reporting it on their employment tax returns, generally Form 941. The excess can be refunded to the employer if the credit goes beyond the amount of work taxes owed.
It is necessary to keep in mind that the ERC provisions and eligibility requirements have evolved gradually. The best course of action is to seek advice from a tax expert or visit the main internal revenue service site for the most detailed and updated details relating to the ERC, including any current legislative changes or updates.
To get approved for the ERC, a company needs to meet among the following criteria:.
Business operations were completely or partly suspended due to a federal government order related to COVID-19.
The business experienced a substantial decline in gross invoices. For 2021, a substantial decrease is specified as a 20% decrease in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a significant decline is specified as a 20% decrease in gross invoices compared to the very same quarter in 2019, or a 20% decrease in gross invoices compared to the instantly preceding quarter.
The ERC is offered to companies of all sizes, consisting of tax-exempt organizations, but there are some exceptions. For instance, federal government entities and services that received a PPP loan might have restrictions on claiming the credit.
The procedure for claiming the ERC involves completing the needed forms and consisting of the credit on your employment income tax return (usually Form 941). The exact time it takes to process the credit can vary based on a number of aspects, including the intricacy of your organization and the workload of the internal revenue service. It’s suggested to talk to a tax professional for guidance specific to your circumstance.
There are several business that can help with the process of declaring the ERC. These consist of accounting companies, tax advisory services, and payroll service providers. Some well-known business that provide support with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s suggested to research study and get in touch with these business straight to ask about their services and fees.
Please keep in mind that the info provided here is based upon general understanding and might not reflect the most current updates or modifications to the ERC. It is very important to speak with a tax expert or visit the official internal revenue service website for the most current and precise information concerning eligibility, declaring procedures, and offered assistance.
Less than 100. The credit is based if the employer had 100 or fewer workers on average in 2019.
on earnings paid to all staff members whether they really worked or not. To put it simply, even if the.
staff members worked full time and got paid for full time work, the company still gets the credit.
Greater than 100. If the company had more than 100 workers usually in 2019, then the credit is.
enabled just for salaries paid to staff members who did not work during the calendar quarter.
In both cases, “wages” includes not simply money payments but also a portion of the cost of company.
provided health care. Employee Retention Credit If You Get Ppp
Companies can be instantly compensated for the credit by reducing the quantity of payroll taxes they.