Lets talk first about Employee Retention Credit New Business :
Our team here what do these people doing everyone in this space is helping teach people about ERC and uh always supply a stunning breakfast and have individuals actually discover the program we should head to the room where we have the ability to show some of the checks that we are getting for companies and I wish to see that what is this this is uh numerous countless dollars actually Kevin hundreds of countless dollars so these are duplicate copies of the letters that go to clients confirming that the check is on the method I mean you understand if you just start to take a look at some of these here I mean this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I indicate it’s simply I mean think about 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 verified 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 understand when you
get this you understand the check is gone for sure and that’s when they pay so they do not pay anything up until they really get the cash they do not pay bottom line Wonder trust anything till this letter is verified the check is on the way they transfer it into their checking account and they can really rely on Wonder trust that the process has actually been completed and the number of you believe you’ve processed considering that you began this we’re about 35 000 of these for
about 6 billion dollars wow so clearly they understand what they’re doing which’s what you require you need 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 Wonderful here you’re at my YouTube channel we’re talking about something truly important today the worker retention credit which the majority of you have never become aware of I certainly had not become aware of it up until really recently and discovered a lot about it because this is most likely the most affordable expense of capital for any small company anywhere
anytime if you have employees between five 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 Concepts they’re the biggest processor of these ERC credits this is a 170 page program so it’s difficult this isn’t like PPP we just contact your bank manager 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 us all about it and how to get it and why I have actually ended up being yes the Ambassador and paid representative for this I enjoy this program it’s disappearing very soon you got to learn everything about it let’s talk staff member retention credit Josh Fox what is an ERC let’s just begin there so throughout the Trump Administration when President Trump was enacted they created the cares Act and the cares act used services three chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly everybody it makes a big distinction right there two of them are loans and one’s a refund exactly so the ERC is a refund that’s.
fix the cash cash payroll tax refund fine go on sorry I just need to make sure we got that point I indicate that’s a big difference a loan versus money money I like money money that’s what we’re speaking 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 original cares Act is the ERC and yes Kevin it is a lovely tough check in the mail where you get actual cash from the IRS all right so let’s talk about how it works due to the fact that it sounds like to me if it’s a if it’s employee retention credit that individual had to be a staff member so I’m going to make the Assumption this money is not for the owner not for people on the cap table not for shareholders it’s for employees right you needed to have owned a service however it’s based upon you having W-2 workers 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 six months of 2021 on the W-2 right so there were 6 quarters the program was open well stroll us through the six quarters so you had quarters 2 three and 4 of 2020 and you had quarters one two and 3 of 2021. alright so that’s how it’s determined you have to be on the W-2 during that period now let’s talk my preferred part cash just 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 exact Kevin is 50 of the employee’s wage to an optimum of five thousand dollars per employee for the year of 2020 and in 2021 the numbers escalated to 70 of the worker’s salary to a maximum of seven thousand per quarter how did that occur um they just changed the rules in.
2021 versus since 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 up to five thousand Max and then what happens 21 000 Max in 2021 oh that’s how you create twenty 6 thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty 6 thousand dollars per staff member that is since that’s a great deal of money it is now there’s a caution here the PPP money would need to be minimized from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan 2 you would lower the 26 000 so what we’re seeing on average Kevin is if you took PPP cash somewhere around ten thousand dollars an individual so let’s state hypothetically you owned a restaurant 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 internal revenue service so it’s big obviously now the big question is why does no one understand about this because look when I first became aware of this when I initially fulfilled Josh you know I’ve got lots of financial investments in great deals of companies I’m a major advocate for entrepreneurship in America and make many lots of investments in entrepreneurs of which lots of suffered through the pandemic when I initially found out about this I called BS I do not believe it since 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 and that were well should have and we utilized them wisely to survive during the pandemic so when I heard about this I stated nah it can’t hold true but when I dug around I even called to my political leader good friends Governor Senators they didn’t know about it I mean that’s how you understand that’s how misinformation is that there’s no details out there then a bunch of individuals informed me well you can’t get it because you took the PPP likewise not true so let’s ask Josh why does nobody learn about the staff member retention credit you know what’s interesting you’re discussing the banks Kevin because 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 procedure procedure that’s all um and here there was turmoil since keep in mind in the original cares act you might refrain from doing both programs so if you had actually done PPP you could not do ERC in the initial program and when they changed the law in 2021 the banks were not 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 anyone about how to.
do this does your CFO know how to do this not really he or she’s never ever done it in the past do the banks do it nope the banks do not do it the payroll business yeah a few of them are doing it as a payroll business your accountant no your accountant’s never ever done this prior to unless you have an account that entered into this organization and bottom line my firm Kevin has actually stayed in business since 2009 and we have actually been working with the federal government and the state federal government to recuperate cash for Fortune 500 Fortune 1000 business so a lot of our huge huge business clients have actually dealt with bottom line to recuperate other federal government programs we’ve done sales tax and utilize tax joblessness tax work opportunity tax credits research and development tax credits unclaimed home property 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 workers on their payroll. The credit is 50% of approximately $10,000 in salaries paid by an.
employer whose organization is completely or partially suspended because of COVID-19 or whose gross invoices.
decrease by more than 50%.
1. The credit is readily available to all companies no matter size including tax exempt companies. There are.
just 2 exceptions: (1) state and local governments and their instrumentalities and (2) small.
companies who take Small Business Loans.
2. To certify, the company needs to satisfy one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the employer’s company is completely or partially suspended by federal government order due to COVID-19.
during the calendar quarter or.
o the employer’s gross invoices are listed below 50% of the similar quarter in 2019. Once the.
employer’s gross invoices exceed 80% of a similar quarter in 2019 they no longer certify.
after the end of that quarter.
Calculation of the Credit.
The quantity of the credit is 50% of the qualifying salaries paid up to $10,000 in overall.
It works for salaries paid after March 13th and prior to December 31, 2020.
The definition of certifying incomes varies by whether an employer had, usually, basically than.
100 staff members in 2019.
Companies that specialize in ERC filing help typically offer proficiency and assistance to help organizations browse the intricate procedure of claiming the credit. They can provide numerous services, including:.
How is the employee retention credit calculated? Employee Retention Credit New Business
Eligibility Evaluation: These companies will examine your company’s eligibility for the ERC based on elements such as your industry, income, and operations. They can help figure out if you fulfill the requirements for the credit and identify the maximum credit amount you can declare.
Documentation and Computation: ERC filing services will help in collecting the necessary documentation, such as payroll records and monetary statements, to support your claim. They will likewise assist determine the credit amount based upon eligible incomes and other qualifying expenditures.
Retroactive Claim Evaluation: If you are qualified to declare the ERC for previous quarters, these companies can evaluate your previous payroll records and financials to recognize possible opportunities for retroactive credits. They can help you amend prior income tax return to claim these refunds.
Filing Help: Business concentrating on ERC filings will prepare and submit the needed types and paperwork in your place. This consists of completing Kind 941 or any other required tax forms.
Compliance and Updates: ERC guidelines and assistance have actually evolved with time. These companies stay updated with the most recent modifications and guarantee that your filings comply with the most existing guidelines. They can also offer continuous support if the IRS demands extra details or performs an audit related to your ERC claim.
It is essential to research and vet any business offering ERC filing help to ensure their reliability and competence. Search for established companies with experience in tax and payroll services, or think about connecting to relied on accounting firms or tax experts who use ERC submitting assistance.
Bear in mind that while these business can offer valuable support, it’s constantly a great concept to have a basic understanding of the ERC requirements and process yourself. This will help you make informed choices and guarantee accurate filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit presented by the U.S. government as part of COVID-19 relief steps. The objective of the ERC is to encourage organizations to keep and pay their employees during the pandemic, even if their operations have been affected.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is readily available to qualified employers, including for-profit services, tax-exempt organizations, and particular governmental entities. To qualify, companies must satisfy one of two criteria:.
The business operations were fully or partly suspended due to a federal government order related to COVID-19.
Business experienced a significant decrease in gross invoices. As pointed out previously, for 2021, a considerable decline is specified as a 20% decline in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a significant decline is defined as a 20% decrease in gross receipts compared to the same quarter in 2019, or a 20% decrease in gross invoices compared to the instantly 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 portion (approximately 70%) of qualified salaries paid to workers, consisting of certain health insurance expenses. 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, services that received an Income Security Program (PPP) loan were not qualified for the ERC. However, legislation passed in late 2020 and extended in 2021 allows companies to declare the ERC even if they got a PPP loan. The same incomes can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively broadened and boosted, enabling qualified companies to claim the credit for qualified earnings paid as far back as March 13, 2020. This retroactive arrangement offers an opportunity for businesses to modify prior-year income tax return and receive refunds.
Declaring the Credit: Employers can declare the ERC by reporting it on their work tax returns, typically Kind 941. If the credit exceeds the quantity of employment taxes owed, the excess can be refunded to the company.
It is necessary to keep in mind that the ERC arrangements and eligibility criteria have actually evolved with time. The very best course of action is to seek advice from a tax expert or check out the official IRS website for the most current and in-depth information relating to the ERC, consisting of any current legal changes or updates.
To qualify for the ERC, a service needs to satisfy one of the following requirements:.
The business operations were fully or partly suspended due to a government order related to COVID-19.
The business experienced a significant decline in gross invoices. For 2021, a considerable decline is specified as a 20% decrease in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a considerable decrease is defined as a 20% decline in gross invoices compared to the exact same quarter in 2019, or a 20% decline in gross invoices compared to the right away preceding quarter.
The ERC is readily available to companies of all sizes, consisting of tax-exempt companies, but there are some exceptions. Federal government entities and organizations that got a PPP loan may have limitations on declaring the credit.
The procedure for declaring the ERC involves completing the essential kinds and including the credit on your work income tax return (normally Kind 941). The exact time it requires to process the credit can vary based on a number of factors, consisting of the intricacy of your organization and the workload of the IRS. It’s advised to speak with a tax professional for guidance specific to your circumstance.
There are a number of companies that can help with the procedure of declaring the ERC. Some popular business that provide support with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the details provided here is based on basic knowledge and may not show the most recent updates or changes to the ERC. It’s important to seek advice from a tax expert or check out the main internal revenue service website for the most precise and current information concerning eligibility, claiming treatments, and available support.
Less than 100. If the company had 100 or fewer workers typically in 2019, then the credit is based.
on earnings paid to all staff members whether they really worked or not. To put it simply, even if the.
employees worked full-time and got paid for full time work, the company still gets the credit.
Greater than 100. If the employer had more than 100 workers usually in 2019, then the credit is.
enabled just for salaries paid to workers who did not work throughout the calendar quarter.
In both cases, “salaries” consists of not just cash payments however also a portion of the expense of employer.
provided healthcare. Employee Retention Credit New Business
Employers can be right away reimbursed for the credit by lowering the amount of payroll taxes they.