Lets talk first about Employee Retention Credit Leased Employees :
Our team here what do these people doing everybody in this room is assisting teach people about ERC and uh always supply a gorgeous breakfast and have individuals truly discover the program we need to head to the space where we have the ability to display a few of the checks that we are getting for business and I wish to see that what is this this is uh numerous millions of dollars actually Kevin hundreds of millions of dollars so these are duplicate copies of the letters that go to customers confirming that the check is on the method I imply you know if you just start to take a look at a few of these here I mean this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I imply it’s simply I imply think about how many real clients 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 confirmed 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 know the check is chosen sure which’s when they pay so they don’t pay anything until they really get the cash they don’t pay bottom line Wonder trust anything till this letter is verified the check is on the method they transfer it into their checking account and they can really trust Wonder trust that the process has been completed and the number of you believe you have actually processed since you started this we have to do with 35 000 of these for
about 6 billion dollars wow so clearly they understand what they’re doing which’s what you require 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 Fantastic here you’re at my YouTube channel we’re discussing something really important today the employee retention credit which most of you have actually never become aware of I certainly had not heard of it up until extremely just recently and learned a lot about it since this is probably the lowest expense of capital for any small company anywhere
anytime if you have staff members in between 5 and five hundred so I have actually got the expert with me this is Josh Fox he’s the creator and CEO of bottom line Ideas 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 phone your bank supervisor and say offer me a loan it does not 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 have actually become yes the Ambassador and paid representative for this I like this program it’s going away 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 during the Trump Administration when President Trump was enacted they created the cares Act and the cares act provided companies 3 chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly everyone it makes a huge difference right there 2 of them are loans and one’s a refund precisely so the ERC is a refund that’s.
correct the cash money payroll tax refund alright go on sorry I just need to make certain we got that point I mean that’s a huge difference a loan versus cash cash I like cash money that’s what we’re discussing 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 initial cares Act is the ERC and yes Kevin it is a beautiful hard check in the mail where you get real money from the internal revenue service 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 worker retention credit that individual had to be an employee so I’m going to make the Assumption this cash is not for the owner not for individuals on the cap table not for investors it’s for workers right you had to have actually owned an organization but it’s based upon 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 qualified so you have 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 six quarters the program was open well walk us through the six quarters so you had quarters 2 three and 4 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 period now let’s talk my favorite part cash just how much can you get back per staff member that was on a W-2 in those 6 quarters so the calculation in 2020 to be specific Kevin is 50 of the staff member’s income to an optimum of 5 thousand dollars per worker for the year of 2020 and in 2021 the numbers increased to 70 of the staff member’s salary to a maximum of 7 thousand per quarter how did that take place um they just altered the rules in.
2021 versus because the turmoil of the pandemic so they wished 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 as much as five thousand Max and after that what occurs 21 000 Max in 2021 oh that’s how you develop twenty 6 thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty 6 thousand dollars per worker that is because that’s a lot of money it is now there’s a caution here the PPP cash would need to be minimized from the twenty six 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 someplace around 10 thousand dollars a person so let’s state hypothetically you owned a dining establishment in New York 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 big certainly now the big question is why does nobody understand about this because look when I initially found out about this when I initially fulfilled Josh you know I have actually got lots of investments in lots of business I’m a significant supporter for entrepreneurship in America and make numerous many investments in business owners of which lots of suffered through the pandemic when I initially became aware of this I called BS I do not believe it due to the fact that I use the PPP we went through the cash center Banks to get it it was very easy to do we had our CEOs call the banks they got their loans and that 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 hold true but when I dug around I even contacted us to my politician pals Guv Senators they didn’t know about it I indicate that’s how you know that’s how false information is that there’s no information out there then a lot of people informed 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 know about the worker retention credit you know 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 wanted a PPP loan you would call Wells Fargo Citibank Bank of America any of the huge 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 simply procedure process that’s all um and here there was chaos because keep in mind in the initial cares act you could 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 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 federal government never ever made it clear to anyone about how to.
do this does your CFO know how to do this not truly she or he’s never ever done it before do the banks do it nope the banks don’t do it the payroll business yeah some of them are doing it as a payroll company your accountant no your accounting professional’s never ever done this before unless you have an account that entered into this service and bottom line my firm Kevin has actually stayed in business given that 2009 and we’ve 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 big business clients have dealt with bottom line to recuperate 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 staff member retention tax credit is a broad based refundable tax credit created to encourage.
employers to keep workers on their payroll. The credit is 50% of up to $10,000 in incomes paid by an.
company whose company is completely or partially suspended because of COVID-19 or whose gross invoices.
decrease by more than 50%.
Availability.
1. The credit is available to all companies despite size consisting of tax exempt organizations. There are.
only 2 exceptions: (1) state and local governments and their instrumentalities and (2) little.
services who take Small Business Loans.
2. To certify, the employer has to satisfy one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the company’s company is fully or partially suspended by government order due to COVID-19.
during the calendar quarter or.
o the employer’s gross receipts are below 50% of the equivalent quarter in 2019. When the.
company’s gross receipts exceed 80% of a similar quarter in 2019 they no longer qualify.
after the end of that quarter.
Computation of the Credit.
The amount of the credit is 50% of the certifying salaries paid up to $10,000 in overall.
It is effective for earnings paid after March 13th and before December 31, 2020.
The definition of qualifying wages differs by whether an employer had, usually, basically than.
100 workers in 2019.
Business that concentrate on ERC filing help usually provide expertise and assistance to help organizations navigate the complex procedure of declaring the credit. They can offer different services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit Leased Employees
Eligibility Assessment: These business will assess your service’s eligibility for the ERC based on aspects such as your market, profits, and operations. They can assist determine if you fulfill the requirements for the credit and determine the maximum credit quantity you can claim.
Documents and Estimation: ERC filing services will assist in collecting the needed paperwork, such as payroll records and monetary declarations, to support your claim. They will likewise help calculate the credit quantity based on eligible earnings and other certifying expenses.
Retroactive Claim Evaluation: If you are eligible to declare the ERC for prior quarters, these business can examine your previous payroll records and financials to identify prospective chances for retroactive credits. They can assist you change previous income tax return to declare these refunds.
Filing Help: Business specializing in ERC filings will prepare and submit the needed forms and documents on your behalf. This includes finishing Type 941 or any other necessary tax return.
Compliance and Updates: ERC regulations and guidance have developed gradually. These companies remain updated with the latest modifications and ensure that your filings comply with the most present guidelines. If the IRS demands additional information or carries out an audit related to your ERC claim, they can also offer continuous support.
It’s important to research and vet any company using ERC filing support to guarantee their reliability and knowledge. Look for established companies with experience in tax and payroll services, or consider reaching out to trusted accounting companies or tax professionals who provide ERC submitting support.
Remember that while these business can provide valuable help, it’s always a good concept to have a standard understanding of the ERC requirements and process yourself. This will help you make informed decisions and ensure precise filings.
The Employee Retention Credit (ERC) is a refundable tax credit presented by the U.S. government as part of COVID-19 relief procedures. The objective of the ERC is to encourage businesses to maintain and pay their workers 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 employers, consisting of for-profit businesses, tax-exempt organizations, and certain governmental entities. To qualify, companies need to fulfill one of two requirements:.
Business operations were completely or partially suspended due to a government order related to COVID-19.
The business experienced a substantial decrease in gross receipts. As pointed out earlier, 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 substantial decline 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 immediately preceding quarter.
Credit Amount: The ERC is a refundable tax credit that offsets the employer’s share of Social Security taxes. The credit quantity amounts to a percentage (as much as 70%) of certified earnings paid to workers, including particular health insurance expenditures. The maximum credit per staff member is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: At first, businesses that got an Income Security Program (PPP) loan were not eligible for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 enables companies to declare the ERC even if they received a PPP loan. Nevertheless, the exact same salaries can not be utilized to claim both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively expanded and boosted, enabling eligible employers to claim the credit for certified earnings paid as far back as March 13, 2020. This retroactive arrangement supplies an opportunity for organizations to modify prior-year tax returns and get refunds.
Declaring the Credit: Companies can claim the ERC by reporting it on their work tax returns, normally Kind 941. If the credit surpasses the quantity of work taxes owed, the excess can be refunded to the company.
It’s important to keep in mind that the ERC provisions and eligibility criteria have developed in time. The very best course of action is to seek advice from a tax professional or visit the main internal revenue service website for the most comprehensive and updated details relating to the ERC, including any current legal changes or updates.
To receive the ERC, a company must fulfill among the following criteria:.
The business operations were completely or partly suspended due to a government order related to COVID-19.
The business experienced a considerable decrease in gross invoices. For 2021, a considerable decline is defined as a 20% decrease in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a significant decline is defined as a 20% decline in gross receipts compared to the same quarter in 2019, or a 20% decline in gross receipts compared to the immediately preceding quarter.
The ERC is offered to services of all sizes, including tax-exempt companies, however there are some exceptions. For example, government entities and companies that got a PPP loan might have restrictions on claiming the credit.
The procedure for claiming the ERC includes finishing the needed types 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 on several aspects, consisting of the complexity of your business and the work of the IRS. It’s recommended to speak with a tax expert for guidance specific to your situation.
There are several companies that can assist with the process of claiming the ERC. Some well-known business that use assistance with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the details provided here is based on general understanding and might not reflect the most current updates or changes to the ERC. It is essential to seek advice from a tax professional or visit the official internal revenue service site for the most precise and current info regarding eligibility, claiming treatments, and available help.
Less than 100. If the company had 100 or fewer employees typically in 2019, then the credit is based.
on wages paid to all workers whether they really worked or not. To put it simply, even if the.
employees worked full time and earned money for full time work, the company still gets the credit.
Greater than 100. If the employer had more than 100 workers typically in 2019, then the credit is.
permitted only for incomes paid to workers who did not work during the calendar quarter.
In both cases, “incomes” includes not simply cash payments however also a portion of the cost of employer.
supplied health care. Employee Retention Credit Leased Employees
Payment.
Employers can be immediately reimbursed for the credit by decreasing the amount of payroll taxes they.