Lets talk first about Employee Retention Credit Per Employee :
Our group here what do these men doing everyone in this room is helping teach individuals about ERC and uh constantly supply a beautiful breakfast and have people actually learn about the program we ought to head to the space where we are able to display some 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 literally Kevin hundreds of millions of dollars so these are replicate copies of the letters that go to clients confirming that the check is on the way I mean you know if you simply start to look at some of these here I imply this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I suggest it’s just I mean consider the number of actual customers that went through the program yeah this is the very end this is the party at the end when the check is validated the numbers are verified and the check is on the mail in the mail from the internal revenue service heading to the client so that’s how you’re able to track it you understand when you
receive this you know the check is gone for sure and that’s when they pay so they do not pay anything until they really receive the money they don’t pay bottom line Wonder trust anything till this letter is confirmed the check is on the method they transfer it into their savings account and they can truly trust Wonder trust that the process has actually been ended up and how many you think you have actually processed considering that you started this we’re about 35 000 of these for
about six billion dollars wow so plainly they understand what they’re doing and that’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 Fantastic here you’re at my YouTube channel we’re talking about something really crucial today the worker retention credit which the majority of you have actually never heard of I definitely hadn’t become aware of it up until really recently and learned a lot about it due to the fact that this is probably the most affordable cost of capital for any small business anywhere
anytime if you have workers in between five and five hundred so I’ve got the specialist with me this is Josh Fox he’s the founder and CEO of bottom line Ideas they’re the biggest processor of these ERC credits this is a 170 page program so it’s challenging this isn’t like PPP we just phone your bank manager and state give me a loan it doesn’t 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’ve ended up being yes the Ambassador and paid representative for this I like 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 simply begin there so during the Trump Administration when President Trump was enacted they created the cares Act and the cares act offered services 3 opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and almost everyone it makes a huge distinction right there two of them are loans and one’s a refund exactly so the ERC is a refund that’s.
fix the money cash payroll tax refund fine go on sorry I just need to ensure we got that point I imply that’s a huge distinction a loan versus money cash I like money money that’s what we’re talking about fine 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 gorgeous tough check in the mail where you get actual money from the IRS all right so let’s discuss how it works since it seems 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 money is not for the owner not for people on the cap table not for investors it’s for staff members right you needed to have owned a service however it’s based upon you having W-2 workers 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 very first 6 months of 2021 on the W-2 appropriate so there were six 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 2 and 3 of 2021. fine so that’s how it’s determined you have to be on the W-2 during 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 6 quarters so the computation in 2020 to be precise Kevin is 50 of the employee’s wage to an optimum of 5 thousand dollars per employee for the year of 2020 and in 2021 the numbers increased to 70 of the staff member’s salary to an optimum of 7 thousand per quarter how did that occur um they simply altered the rules in.
2021 versus due to the fact that the mayhem 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 then what takes place 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 staff member that is because that’s a great deal of cash 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 2 you would decrease the 26 000 so what we’re seeing usually Kevin is if you took PPP cash somewhere around 10 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 staff members and you took PPP money you would still get a million dollar in the mail from the IRS so it’s substantial undoubtedly now the huge concern is why does nobody understand about this due to the fact that look when I first became aware of this when I first fulfilled Josh you understand I have actually got lots of investments in great deals of companies I’m a major advocate for entrepreneurship in America and make numerous numerous investments in business owners of which numerous suffered through the pandemic when I first heard about this I called BS I do not believe it since 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 and that were well deserved and we used them carefully to survive throughout the pandemic so when I found out about this I stated nah it can’t be true but when I dug around I even contacted us to my political leader buddies Guv Senators they didn’t learn about it I mean that’s how you understand that’s how false information is that there’s no info out there then a bunch of people informed me well you can’t get it because you took the PPP also not true so let’s ask Josh why does no one know about the worker retention credit you know what’s fascinating you’re speaking about the banks Kevin since 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 procedure process that’s all um and here there was turmoil since 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 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 made it clear to anyone about how to.
do this does your CFO understand how to do this not truly he or she’s never done it in the past do the banks do it nope the banks do not do it the payroll companies yeah a few of them are doing it as a payroll company your accounting professional no your accountant’s never ever done this before unless you have an account that went into this organization and bottom line my firm Kevin has been in business because 2009 and we’ve been dealing with the federal government and the state government to recover cash for Fortune 500 Fortune 1000 business so a lot of our huge big business clients have worked with bottom line to recover other government programs we’ve done sales tax and use tax joblessness tax work opportunity tax credits research and development tax credits unclaimed property real estate tax all of these other government programs.
The staff member retention tax credit is a broad based refundable tax credit created to encourage.
employers to keep employees on their payroll. The credit is 50% of approximately $10,000 in incomes paid by an.
Due to the fact that of COVID-19 or whose gross receipts, company whose business is fully or partly suspended.
decrease by more than 50%.
Schedule.
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) little.
services who take Small Business Loans.
2. To qualify, the employer needs to meet one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the company’s organization is completely or partially suspended by government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross receipts are listed below 50% of the equivalent quarter in 2019. Once the.
employer’s gross invoices go above 80% of a comparable quarter in 2019 they no longer qualify.
after completion of that quarter.
Computation of the Credit.
The amount of the credit is 50% of the certifying incomes paid up to $10,000 in total.
It works for incomes paid after March 13th and prior to December 31, 2020.
The meaning of qualifying wages differs by whether an employer had, typically, basically than.
100 workers in 2019.
Business that concentrate on ERC filing help generally provide competence and support to help companies browse the complex procedure of claiming the credit. They can use different services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit Per Employee
Eligibility Assessment: These companies will assess your organization’s eligibility for the ERC based upon elements such as your market, earnings, and operations. They can help figure out if you meet the requirements for the credit and identify the maximum credit amount you can claim.
Paperwork and Calculation: ERC filing services will help in gathering the essential documentation, such as payroll records and monetary statements, to support your claim. They will likewise help compute the credit quantity based on qualified earnings and other certifying costs.
Retroactive Claim Evaluation: If you are qualified to claim the ERC for previous quarters, these companies can review your past payroll records and financials to determine potential chances for retroactive credits. They can help you change previous income tax return to claim these refunds.
Filing Help: Business concentrating on ERC filings will prepare and send the essential types and documents on your behalf. This consists of completing Type 941 or any other required tax forms.
Compliance and Updates: ERC guidelines and assistance have evolved in time. These companies stay upgraded with the most recent modifications and make sure that your filings comply with the most current guidelines. If the Internal revenue service requests extra info or carries out an audit associated to your ERC claim, they can likewise offer continuous assistance.
It is very important to research and vet any business providing ERC filing assistance to guarantee their reliability and proficiency. Try to find established firms with experience in tax and payroll services, or consider connecting to relied on accounting companies or tax professionals who provide ERC filing assistance.
Bear in mind that while these business can supply valuable support, it’s constantly an excellent idea to have a standard understanding of the ERC requirements and procedure yourself. This will help you make notified decisions and guarantee precise filings.
The Employee Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief measures. The objective of the ERC is to motivate companies to keep and pay their employees throughout the pandemic, even if their operations have been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is offered to qualified companies, consisting of for-profit businesses, tax-exempt companies, and particular governmental entities. To qualify, employers need to fulfill one of two requirements:.
The business operations were fully or partly suspended due to a federal government order related to COVID-19.
The business experienced a significant decrease in gross invoices. As discussed previously, for 2021, a substantial decrease is specified as a 20% decline in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a considerable decline is defined as a 20% decrease in gross invoices compared to the exact same quarter in 2019, or a 20% decrease in gross receipts compared to the immediately preceding quarter.
Credit Amount: 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 qualified incomes paid to employees, consisting of particular health plan expenses. 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: At first, organizations that got a Paycheck Protection Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 permits services to claim the ERC even if they got a PPP loan. Nevertheless, the exact same salaries can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively broadened and boosted, allowing qualified companies to declare the credit for certified incomes paid as far back as March 13, 2020. This retroactive arrangement provides an opportunity for services to change prior-year income tax return and receive refunds.
Claiming the Credit: Employers can declare the ERC by reporting it on their work income tax return, usually Kind 941. If the credit goes beyond the quantity of employment taxes owed, the excess can be refunded to the company.
It is essential to note that the ERC provisions and eligibility requirements have developed gradually. The best course of action is to speak with a tax professional or visit the official internal revenue service site for the most updated and detailed information regarding the ERC, including any current legal modifications or updates.
To qualify for the ERC, an organization should satisfy among the following criteria:.
The business operations were fully or partly suspended due to a federal government order related to COVID-19.
The business experienced a substantial decrease in gross invoices. For 2021, a significant 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 specified as a 20% decline in gross receipts compared to the very same quarter in 2019, or a 20% decrease in gross invoices compared to the instantly preceding quarter.
The ERC is available to businesses of all sizes, consisting of tax-exempt companies, but there are some exceptions. For instance, federal government entities and services that received a PPP loan may have limitations on claiming the credit.
The process for declaring the ERC includes finishing the essential types and consisting of the credit on your work income tax return (typically Kind 941). The exact time it takes to process the credit can differ based upon several elements, consisting of the complexity of your business and the work of the IRS. It’s suggested to consult with a tax professional for guidance particular to your situation.
There are a number of companies that can help with the process of claiming the ERC. These include accounting companies, tax advisory services, and payroll company. Some well-known companies that offer support with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s advisable to research study and call these companies straight to ask about their services and fees.
Please keep in mind that the details provided here is based on general knowledge and may not reflect the most current updates or modifications to the ERC. It is essential to seek advice from a tax expert or visit the main internal revenue service site for the most precise and updated information regarding eligibility, claiming procedures, and available assistance.
Less than 100. If the company had 100 or less staff members usually in 2019, then the credit is based.
on wages paid to all employees whether they in fact worked or not. Simply put, even if the.
employees worked full-time and made money for full-time work, the employer still gets the credit.
Greater than 100. The credit is if the employer had more than 100 workers on average in 2019.
permitted just for wages paid to workers who did not work during the calendar quarter.
In both cases, “salaries” consists of not simply cash payments however also a portion of the expense of company.
supplied healthcare. Employee Retention Credit Per Employee
Payment.
Companies can be instantly compensated for the credit by decreasing the quantity of payroll taxes they.