Lets talk first about Employee Retention Credit Owner Salary :
Our team here what do these people doing everyone in this room is assisting teach people about ERC and uh constantly provide a gorgeous breakfast and have people really learn about the program we need to head to the room where we are able to display a few of the checks that we are getting for business and I ‘d like to see that what is this this is uh numerous countless dollars literally Kevin hundreds of millions of dollars so these are replicate copies of the letters that go to customers confirming that the check is on the way I imply you know if you just begin to look at a few of these here I imply this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I indicate it’s just I suggest think of 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 validated the numbers are verified and the check is on the mail in the mail from the IRS heading to the customer so that’s how you’re able to track it you know when you
receive this you know the check is opted for sure and that’s when they pay so they do not pay anything till they really get the money they do not pay bottom line Wonder trust anything up until this letter is verified the check is on the way they transfer it into their savings account and they can truly trust Wonder trust that the procedure has been ended up and the number of you believe you have actually processed because 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 which’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 Fantastic here you’re at my YouTube channel we’re talking about something really essential today the worker retention credit which the majority of you have actually never ever become aware of I certainly had not become aware of it until very just recently and found out a lot about it because this is probably the lowest expense of capital for any small business anywhere
anytime if you have staff members in between five 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 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 manager and state offer me a loan it doesn’t work there’s not a loan it’s an application and Josh is going to tell us all 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 going away very soon you got to find out all about it let’s talk employee retention credit Josh Fox what is an ERC let’s simply begin there so during the Trump Administration when President Trump was enacted they created the cares Act and the cares act used companies 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 huge difference right there 2 of them are loans and one’s a refund exactly so the ERC is a refund that’s.
correct the money money payroll tax refund fine go on sorry I just have to make sure we got that point I mean that’s a huge distinction a loan versus money cash I like money cash 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 stunning tough check in the mail where you get real cash from the internal revenue service all right so let’s speak about how it works because it seems 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 Presumption this cash is not for the owner not for people on the cap table not for investors it’s for employees right you needed to have actually owned a service 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 qualified so you need to be on payroll in 2020 on the W-2 and you need to be on payroll for the first 6 months of 2021 on the W-2 proper so there were 6 quarters the program was open well stroll us through the 6 quarters so you had quarters two three and 4 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 duration now let’s talk my favorite part money how much can you get back per staff member that was on a W-2 in those six quarters so the computation in 2020 to be exact Kevin is 50 of the staff member’s wage to an optimum of 5 thousand dollars per employee for the year of 2020 and in 2021 the numbers escalated to 70 of the worker’s income to a maximum of 7 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 employees 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 takes place 21 000 Max in 2021 oh that’s how you develop twenty six thousand twenty one thousand to twenty twenty one plus five 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 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 reduce the 26 000 so what we’re seeing on average Kevin is if you took PPP cash someplace around ten 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 internal revenue service so it’s huge clearly now the big concern is why does nobody know about this because appearance when I first heard about this when I first met Josh you understand I have actually got lots of investments in lots of companies I’m a significant supporter for entrepreneurship in America and make lots of lots of investments in business owners of which lots of suffered through the pandemic when I first found out about this I called BS I don’t believe it due to the fact that I utilize 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 which were well should have and we utilized them wisely to survive throughout the pandemic so when I found out about this I said nah it can’t hold true however when I dug around I even called to my political leader friends Guv Senators they didn’t understand about it I mean that’s how you know that’s how false information is that there’s no details out there then a lot of people 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 learn about the staff member retention credit you know what’s fascinating you’re speaking about the banks Kevin because 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 simply process process that’s all um and here there was chaos because keep in mind in the initial cares act you might refrain from doing both programs so if you had actually done PPP you might refrain from doing ERC in the initial program and when they altered 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 government never ever made it clear to anybody about how to.
do this does your CFO understand how to do this not actually she or he’s never ever done it previously do the banks do it nope the banks don’t do it the payroll business yeah a few of them are doing it as a payroll business your accountant no your accounting professional’s never ever done this before unless you have an account that went into this company and bottom line my firm Kevin has actually been in business considering that 2009 and we’ve been dealing with the federal government and the state government to recover money for Fortune 500 Fortune 1000 business so a lot of our huge big corporate clients have actually worked with bottom line to recover other government programs we have actually done sales tax and utilize tax unemployment tax work opportunity tax credits research and development tax credits unclaimed property property tax all of these other federal government programs.
The employee retention tax credit is a broad based refundable tax credit created to motivate.
employers to keep workers on their payroll. The credit is 50% of approximately $10,000 in wages paid by an.
employer whose service is fully or partly suspended because of COVID-19 or whose gross receipts.
decline by more than 50%.
1. The credit is offered to all employers no matter size consisting of tax exempt companies. There are.
just 2 exceptions: (1) state and city governments and their instrumentalities and (2) small.
companies 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 company’s service is fully 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 equivalent quarter in 2019. Once the.
company’s gross invoices go above 80% of an equivalent 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 earnings paid up to $10,000 in total.
It is effective for wages paid after March 13th and prior to December 31, 2020.
The meaning of certifying earnings differs by whether a company had, typically, basically than.
100 employees in 2019.
Business that specialize in ERC filing assistance typically provide proficiency and support to help services navigate the complex process of claiming the credit. They can use numerous services, including:.
How is the employee retention credit calculated? Employee Retention Credit Owner Salary
Eligibility Evaluation: These companies will assess your service’s eligibility for the ERC based on elements such as your industry, income, and operations. If you meet the requirements for the credit and determine the optimum credit amount you can claim, they can help figure out.
Paperwork and Calculation: ERC filing services will help in collecting the necessary documents, such as payroll records and monetary statements, to support your claim. They will likewise help compute the credit quantity based on eligible salaries and other qualifying costs.
Retroactive Claim Review: If you are eligible to claim the ERC for prior quarters, these business can review your previous payroll records and financials to determine potential chances for retroactive credits. They can help you change prior income tax return to declare these refunds.
Filing Assistance: Companies specializing in ERC filings will prepare and submit the essential types and paperwork on your behalf. This includes completing Form 941 or any other required tax forms.
Compliance and Updates: ERC guidelines and guidance have developed gradually. These companies remain updated with the most recent changes and make sure that your filings comply with the most present standards. They can likewise supply ongoing support if the IRS requests additional details or conducts an audit related to your ERC claim.
It is very important to research study and veterinarian any business using ERC filing help to guarantee their credibility and know-how. Look for recognized companies with experience in tax and payroll services, or consider reaching out to relied on accounting firms or tax professionals who provide ERC submitting assistance.
Keep in mind that while these companies can supply important assistance, it’s always a great idea to have a fundamental understanding of the ERC requirements and process yourself. This will assist you make informed decisions and make sure 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 measures. The goal of the ERC is to encourage services to keep and pay their employees throughout the pandemic, even if their operations have actually been impacted.
Here are some key points about the ERC:.
Eligibility: The ERC is readily available to eligible employers, including for-profit businesses, tax-exempt companies, and particular governmental entities. To qualify, companies must meet one of two requirements:.
Business operations were fully or partly suspended due to a government order related to COVID-19.
Business experienced a significant decrease in gross invoices. As pointed out previously, for 2021, a considerable 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 defined as a 20% decrease in gross receipts compared to the exact 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 company’s share of Social Security taxes. The credit quantity is equal to a percentage (as much as 70%) of certified wages paid to workers, consisting of certain health plan expenses. The optimum credit per worker is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, services that got a Paycheck Protection Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 allows companies to declare the ERC even if they got a PPP loan. The exact same salaries can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively expanded and improved, allowing qualified employers to claim the credit for qualified earnings paid as far back as March 13, 2020. This retroactive arrangement supplies a chance for organizations to change prior-year tax returns and get refunds.
Declaring the Credit: Companies can claim the ERC by reporting it on their employment income tax return, generally Type 941. If the credit goes beyond the amount of work taxes owed, the excess can be refunded to the company.
It’s important to keep in mind that the ERC arrangements and eligibility criteria have progressed with time. The best strategy is to talk to a tax professional or visit the official internal revenue service website for the most comprehensive and current info regarding the ERC, consisting of any current legislative changes or updates.
To qualify for the ERC, a service should meet among the following criteria:.
Business operations were fully or partially suspended due to a government order related to COVID-19.
The business experienced a substantial decline in gross receipts. For 2021, a substantial decline is defined as a 20% decrease in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a significant decrease is defined as a 20% decrease in gross receipts compared to the exact same quarter in 2019, or a 20% decrease in gross invoices compared to the immediately 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 companies that got a PPP loan may have constraints on declaring the credit.
The procedure for claiming the ERC includes finishing the necessary forms and consisting of the credit on your work tax return (generally Form 941). The exact time it requires to process the credit can differ based upon numerous factors, including the intricacy of your business and the work of the internal revenue service. It’s suggested to speak with a tax expert for assistance particular to your circumstance.
There are several companies that can aid with the process of claiming the ERC. These include accounting companies, tax advisory services, and payroll provider. Some popular business that use help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s recommended to research and contact these business directly to ask about their services and costs.
Please note that the info supplied here is based upon basic understanding and may not reflect the most current updates or modifications to the ERC. It is very important to seek advice from a tax professional or check out the official IRS website for the most current and accurate information relating to eligibility, claiming procedures, and readily available support.
Less than 100. The credit is based if the employer had 100 or fewer staff members on average in 2019.
on wages paid to all employees whether they really worked or not. Simply put, even if the.
workers worked full-time and earned money for full time work, the employer still gets the credit.
Greater than 100. If the company had more than 100 workers typically in 2019, then the credit is.
permitted only for salaries paid to workers who did not work throughout the calendar quarter.
In both cases, “salaries” consists of not just money payments however also a part of the cost of employer.
supplied health care. Employee Retention Credit Owner Salary
Companies can be right away compensated for the credit by decreasing the amount of payroll taxes they.