Lets talk first about Employee Retention Credit Sample Calculator :
Our group here what do these men doing everybody in this space is helping teach people about ERC and uh constantly offer a gorgeous breakfast and have people truly learn more about the program we ought to head to the room 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 millions of dollars actually Kevin numerous millions of dollars so these are replicate copies of the letters that go to customers confirming that the check is on the method I indicate you understand if you just begin to take a 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 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 confirmed 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 have the ability to track it you understand when you
get this you know the check is opted for sure and that’s when they pay so they don’t pay anything until they really receive the cash they do not pay bottom line Wonder trust anything until this letter is confirmed the check is on the method they deposit it into their bank account and they can genuinely trust Wonder trust that the process has been ended up and the number of you believe you have actually processed because you began this we’re about 35 000 of these for
about 6 billion dollars wow so plainly they know what they’re doing which’s what you require you need experts 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 most of you have actually never ever become aware of I definitely hadn’t heard of it until extremely just recently and found out a lot about it since this is most likely the lowest cost of capital for any small company anywhere
anytime if you have employees in between 5 and five hundred so I have actually got the expert with me this is Josh Fox he’s the founder and CEO of bottom line Concepts 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 state give 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 become yes the Ambassador and paid representative for this I like this program it’s disappearing 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 during the Trump Administration when President Trump was enacted they came up with the cares Act and the cares act used businesses three chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and almost everybody 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.
correct the cash money payroll tax refund okay go on sorry I just have to make sure we got that point I mean that’s a big difference a loan versus money cash I like money money that’s what we’re speaking 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 initial cares Act is the ERC and yes Kevin it is a gorgeous difficult check in the mail where you get actual cash from the internal revenue service all right so let’s talk about how it works because it sounds like to me if it’s a if it’s employee 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 individuals on the cap table not for investors it’s for employees right you had to have owned a service but it’s based on 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 eligible 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 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. okay so that’s how it’s determined you have to be on the W-2 throughout that period now let’s talk my preferred part cash how much can you return per employee that was on a W-2 in those 6 quarters so the computation in 2020 to be precise 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 employee’s salary to a maximum of seven thousand per quarter how did that happen um they just changed the rules in.
2021 versus because 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 as much as five thousand Max and then what occurs 21 000 Max in 2021 oh that’s how you create twenty six thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty six 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 have to be reduced from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan two you would minimize 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 say hypothetically you owned a restaurant in New York City where I’m from and you had a hundred staff members and you took PPP cash you would still get a million dollar in the mail from the internal revenue service so it’s substantial obviously now the big question is why does nobody understand about this due to the fact that look when I first found out about this when I first met Josh you know I’ve got great deals of investments in lots of companies I’m a significant advocate for entrepreneurship in America and make numerous many investments in entrepreneurs of which many suffered through the pandemic when I initially found out about this I called BS I do not think it since I use the PPP we went through the cash center Banks to get it it was really easy to do we had our CEOs call the banks they got their loans which were well should have and we used them carefully to survive throughout the pandemic so when I found out about this I said nah it can’t be true however when I dug around I even contacted us to my politician good friends Guv Senators they didn’t know about it I imply that’s how you know that’s how false information is that there’s no information out there then a lot of people told me well you can’t get it since you took the PPP also not real so let’s ask Josh why does nobody know about the staff member retention credit you know what’s interesting you’re talking about the banks Kevin because in the PPP loan procedure 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 process procedure that’s all um and here there was mayhem since remember in the original cares act you could not do both programs so if you had actually done PPP you might not do ERC in the original program and when they changed the law in 2021 the banks were refraining from doing ERC because 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 really he or she’s never ever done it before 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 prior to unless you have an account that entered into this service and bottom line my company Kevin has actually stayed in business since 2009 and we’ve been dealing with the federal government and the state government to recuperate cash for Fortune 500 Fortune 1000 business so a lot of our big big corporate customers have dealt with bottom line to recover other federal government programs we’ve done sales tax and use tax unemployment tax work chance tax credits research and development tax credits unclaimed property real estate tax all of these other government programs.
The employee retention tax credit is a broad based refundable tax credit designed to encourage.
companies to keep employees on their payroll. The credit is 50% of approximately $10,000 in wages paid by an.
company whose organization is completely or partly suspended because of COVID-19 or whose gross receipts.
decline by more than 50%.
Accessibility.
1. The credit is readily available to all companies no matter size consisting of tax exempt companies. There are.
just two exceptions: (1) state and city governments and their instrumentalities and (2) small.
organizations who take Small Business Loans.
2. To certify, the employer needs to satisfy one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the company’s business is fully or partly suspended by 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.
employer’s gross invoices go above 80% of an equivalent quarter in 2019 they no longer certify.
after completion of that quarter.
Calculation of the Credit.
The quantity of the credit is 50% of the certifying incomes paid up to $10,000 in total.
It works for salaries paid after March 13th and before December 31, 2020.
The definition of certifying incomes varies by whether an employer had, typically, basically than.
100 workers in 2019.
Companies that specialize in ERC filing assistance generally provide proficiency and assistance to assist companies browse the complicated process of claiming the credit. They can provide numerous services, including:.
How is the employee retention credit calculated? Employee Retention Credit Sample Calculator
Eligibility Evaluation: These companies will examine your organization’s eligibility for the ERC based upon aspects such as your industry, revenue, and operations. They can assist identify if you meet the requirements for the credit and recognize the optimum credit quantity you can declare.
Paperwork and Calculation: ERC filing services will help in gathering the required paperwork, such as payroll records and monetary declarations, to support your claim. They will also assist calculate the credit amount based upon qualified incomes and other qualifying costs.
Retroactive Claim Review: If you are qualified to claim the ERC for previous quarters, these business can review your previous payroll records and financials to recognize possible opportunities for retroactive credits. They can help you amend previous tax returns to declare these refunds.
Filing Support: Business specializing in ERC filings will prepare and send the essential types and paperwork on your behalf. This includes completing Form 941 or any other necessary tax forms.
Compliance and Updates: ERC guidelines and guidance have actually progressed over time. These business stay updated with the most recent modifications and guarantee that your filings abide by the most current standards. They can also offer ongoing support if the IRS requests additional information or conducts an audit related to your ERC claim.
It is very important to research study and vet any company using ERC filing assistance to guarantee their trustworthiness and knowledge. Try to find established firms with experience in tax and payroll services, or consider reaching out to trusted accounting companies or tax experts who use ERC submitting support.
Remember that while these business can supply valuable support, it’s always a great concept to have a fundamental understanding of the ERC requirements and procedure yourself. This will assist you make notified choices and make sure accurate filings.
The Employee Retention Credit (ERC) is a refundable tax credit presented by the U.S. federal government as part of COVID-19 relief procedures. The objective of the ERC is to motivate businesses to retain and pay their workers during the pandemic, even if their operations have been affected.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is offered to eligible companies, consisting of for-profit organizations, tax-exempt companies, and specific governmental entities. To qualify, employers need to meet one of two criteria:.
Business operations were fully or partly suspended due to a government order related to COVID-19.
Business experienced a substantial decline in gross invoices. As mentioned previously, for 2021, a significant decline is defined as a 20% decline in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a significant decrease is specified as a 20% decrease in gross receipts compared to the same quarter in 2019, or a 20% decline in gross receipts compared to the right away preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit amount amounts to a portion (approximately 70%) of qualified wages paid to workers, including specific health plan expenditures. 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, businesses that received an Income Security Program (PPP) loan were not qualified for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 permits services to claim the ERC even if they received a PPP loan. Nevertheless, the same incomes can not be utilized to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively expanded and improved, enabling qualified employers to declare the credit for qualified wages paid as far back as March 13, 2020. This retroactive provision provides a chance for services to modify prior-year tax returns and get refunds.
Declaring the Credit: Employers can claim the ERC by reporting it on their employment income tax return, generally Type 941. If the credit exceeds the amount of employment 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 actually developed with time. The best course of action is to consult with a tax expert or go to the main internal revenue service website for the most up-to-date and comprehensive details regarding the ERC, consisting of any recent legal changes or updates.
To qualify for the ERC, a business must meet one of the following requirements:.
The business operations were totally or partially suspended due to a government order related to COVID-19.
Business experienced a substantial decline in gross invoices. For 2021, a substantial decrease is specified as a 20% decline in gross invoices compared to the 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% decrease in gross receipts compared to the instantly preceding quarter.
The ERC is offered to organizations of all sizes, including tax-exempt companies, but there are some exceptions. Federal government entities and organizations that got a PPP loan might have restrictions on declaring the credit.
The process for claiming the ERC includes completing the necessary forms and consisting of the credit on your work income tax return (typically Type 941). The exact time it requires to process the credit can differ based on several factors, including the intricacy of your company and the work of the internal revenue service. It’s advised to speak with a tax expert for assistance particular to your situation.
There are numerous companies that can assist with the procedure of declaring the ERC. Some popular business that offer help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the info supplied here is based upon general understanding and may not show the most current updates or changes to the ERC. It is very important to seek advice from a tax professional or check out the main internal revenue service site for the most updated and precise details regarding eligibility, claiming procedures, and available help.
Less than 100. If the employer had 100 or fewer workers typically in 2019, then the credit is based.
on wages paid to all staff members whether they really worked or not. Simply put, even if the.
staff members worked full time and got paid for full time work, the employer still gets the credit.
Greater than 100. The credit is if the company had more than 100 staff members on average in 2019.
permitted only for salaries paid to workers who did not work during the calendar quarter.
In both cases, “incomes” consists of not just money payments but likewise a part of the expense of employer.
provided healthcare. Employee Retention Credit Sample Calculator
Payment.
Employers can be immediately reimbursed for the credit by reducing the amount of payroll taxes they.