Lets talk first about Employee Retention Credit Schedule C :
Our group here what do these men doing everyone in this room is helping teach individuals about ERC and uh always offer a beautiful breakfast and have people actually learn about the program we must head to the space where we are able to display a few of the checks that we are getting for business and I want to see that what is this this is uh hundreds of millions of dollars literally Kevin numerous millions of dollars so these are duplicate copies of the letters that go to clients verifying that the check is on the way I suggest 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 suggest it’s simply I mean think about 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 confirmed the numbers are verified and the check is on the mail in the mail from the IRS heading to the consumer so that’s how you have the ability to track it you know when you
get this you understand the check is gone for sure which’s when they pay so they don’t pay anything till they really receive the cash they don’t pay bottom line Wonder trust anything till this letter is confirmed the check is on the method they deposit it into their bank account and they can truly trust Wonder trust that the process has actually been finished and how many you think you have actually processed given 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 which’s what you need you need experts on the other end of the phone to process this and get it to where you get among these that’s what matters all right Mr Wonderful here you’re at my YouTube channel we’re speaking about something truly crucial today the worker retention credit which the majority of you have never heard of I certainly had not become aware of it until very recently and discovered a lot about it due to the fact that this is most likely the lowest cost of capital for any small business anywhere
anytime if you have staff members in 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 largest 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 supervisor 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 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 enjoy this program it’s disappearing soon you got to learn all about it let’s talk staff member retention credit Josh Fox what is an ERC let’s simply start there so during the Trump Administration when President Trump was enacted they came up with the cares Act and the cares act offered businesses 3 chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and almost everybody it makes a big distinction right there 2 of them are loans and one’s a refund precisely so the ERC is a refund that’s.
correct the money money payroll tax refund okay go on sorry I simply have to make certain we got that point I indicate that’s a huge difference a loan versus cash cash I like cash cash that’s what we’re talking about all right 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 money from the IRS all right so let’s speak about how it works because it sounds like to me if it’s a if it’s staff member retention credit that person needed to be a worker so I’m going to make the Assumption this cash is not for the owner not for people on the cap table not for shareholders it’s for workers right you had to have actually owned a company however it’s based upon you having W-2 staff members 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 six months of 2021 on the W-2 correct so there were 6 quarters the program was open well stroll us through the 6 quarters so you had quarters 2 three and 4 of 2020 and you had quarters one two and three of 2021. alright so that’s how it’s measured you need to be on the W-2 throughout that period now let’s talk my preferred part money just how much can you return per worker that was on a W-2 in those 6 quarters so the calculation in 2020 to be specific Kevin is 50 of the employee’s wage to a maximum 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 an optimum of seven thousand per quarter how did that happen um they just altered the rules in.
2021 versus due to the fact that the mayhem of the pandemic so they wished 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 as much as 5 thousand Max and then what happens 21 000 Max in 2021 oh that’s how you come up with 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 cash it is now there’s a caveat here the PPP cash would have to be minimized from the twenty six thousand dollars so if you took PPP loan one and PPP loan two you would reduce the 26 000 so what we’re seeing on average Kevin is if you took PPP money somewhere around 10 thousand dollars a person 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 clearly now the big concern is why does no one learn about this due to the fact that appearance when I initially became aware of this when I initially fulfilled Josh you understand I’ve got great deals of financial investments in lots of companies I’m a major advocate for entrepreneurship in America and make numerous lots of financial investments in business owners of which numerous suffered through the pandemic when I initially heard about this I called BS I don’t 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 used them carefully to stay alive during the pandemic so when I found out about this I stated nah it can’t be true however when I dug around I even called to my politician good friends 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 information 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 true so let’s ask Josh why does nobody understand about the worker retention credit you understand what’s fascinating you’re speaking about the banks Kevin since in the PPP loan process the federal government made it very 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 process in Canada a pre-pp loan there’s no loans in Canada by the way it’s just procedure procedure that’s all um and here there was chaos because keep in mind in the initial cares act you might not do both programs so if you had actually done PPP you could refrain from doing ERC in the original program and when they altered the law in 2021 the banks were not 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 really he or she’s never ever done it before do the banks do it nope the banks do not do it the payroll business yeah some of them are doing it as a payroll company your accounting professional 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 stayed in business because 2009 and we’ve been working with the federal government and the state government to recuperate money for Fortune 500 Fortune 1000 business so a lot of our huge big corporate clients have worked with bottom line to recover other government programs we have actually done sales tax and use tax joblessness tax work chance tax credits research and development tax credits unclaimed home real estate tax all of these other federal government programs.
The worker 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 earnings paid by an.
company whose business is completely or partly suspended because of COVID-19 or whose gross receipts.
decline by more than 50%.
1. The credit is readily available to all employers no matter size consisting of tax exempt companies. There are.
just two exceptions: (1) state and local governments and their instrumentalities and (2) small.
businesses who take Small company Loans.
2. To qualify, the employer has to satisfy one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the company’s organization is completely or partly 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. When the.
company’s gross invoices exceed 80% of a similar quarter in 2019 they no longer certify.
after the end of that quarter.
Estimation of the Credit.
The quantity of the credit is 50% of the qualifying incomes paid up to $10,000 in overall.
It works for salaries paid after March 13th and prior to December 31, 2020.
The meaning of qualifying earnings varies by whether a company had, usually, basically than.
100 employees in 2019.
Companies that focus on ERC filing assistance usually provide expertise and assistance to help businesses navigate the complicated procedure of claiming the credit. They can provide various services, including:.
How is the employee retention credit calculated? Employee Retention Credit Schedule C
Eligibility Assessment: These business will evaluate your business’s eligibility for the ERC based upon elements such as your industry, income, and operations. If you fulfill the requirements for the credit and recognize the maximum credit quantity you can declare, they can assist figure out.
Documentation and Calculation: ERC filing services will assist in gathering the essential documentation, such as payroll records and financial statements, to support your claim. They will likewise help calculate the credit quantity based upon qualified salaries and other qualifying costs.
Retroactive Claim Evaluation: If you are qualified to declare the ERC for prior quarters, these companies can evaluate your previous payroll records and financials to identify possible opportunities for retroactive credits. They can assist you amend prior income tax return to claim these refunds.
Filing Help: Companies concentrating on ERC filings will prepare and submit the required kinds and documentation in your place. This consists of finishing Kind 941 or any other required tax forms.
Compliance and Updates: ERC regulations and assistance have actually progressed over time. These business stay updated with the current modifications and guarantee that your filings adhere to the most existing standards. They can also supply continuous assistance if the internal revenue service requests additional details or performs an audit related to your ERC claim.
It is essential to research study and veterinarian any company using ERC filing help to guarantee their credibility and proficiency. Search for established firms with experience in tax and payroll services, or consider reaching out to trusted accounting companies or tax experts who offer ERC filing support.
Bear in mind that while these business can supply valuable assistance, it’s always a good idea to have a standard understanding of the ERC requirements and procedure yourself. This will help you make informed decisions and make sure precise filings.
The Employee Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief procedures. The goal of the ERC is to motivate services to keep and pay their employees during the pandemic, even if their operations have actually been impacted.
Here are some key points about the ERC:.
Eligibility: The ERC is available to qualified companies, consisting of for-profit organizations, tax-exempt companies, and certain governmental entities. To qualify, employers need to meet one of two criteria:.
Business operations were completely or partly suspended due to a federal government order related to COVID-19.
The business experienced a substantial decline in gross invoices. As pointed out previously, for 2021, a significant decrease is specified as a 20% decrease in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a considerable decrease is defined as a 20% decline in gross receipts compared to the same quarter in 2019, or a 20% decrease in gross invoices 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 amount amounts to a portion (as much as 70%) of certified wages paid to workers, including specific 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: At first, organizations that got a Paycheck Security Program (PPP) loan were not eligible for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 permits companies to claim the ERC even if they got a PPP loan. The same earnings can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively expanded and enhanced, allowing eligible employers to declare the credit for qualified earnings paid as far back as March 13, 2020. This retroactive provision offers an opportunity for organizations to modify prior-year tax returns and get refunds.
Declaring the Credit: Employers can declare the ERC by reporting it on their employment income tax return, usually Kind 941. If the credit surpasses the quantity of work taxes owed, the excess can be reimbursed to the employer.
It is very important to keep in mind that the ERC arrangements and eligibility criteria have actually progressed gradually. The very best strategy is to consult with a tax professional or check out the main internal revenue service site for the most up-to-date and in-depth info concerning the ERC, consisting of any current legislative changes or updates.
To get approved for the ERC, a company must satisfy one of the following requirements:.
The business operations were totally or partly suspended due to a federal government order related to COVID-19.
The business experienced a considerable decline in gross invoices. For 2021, a significant decline is specified as a 20% decline in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a considerable decrease is defined as a 20% decline in gross invoices compared to the very same quarter in 2019, or a 20% decline in gross invoices compared to the right away preceding quarter.
The ERC is available to companies of all sizes, including tax-exempt companies, however there are some exceptions. Government entities and companies that got a PPP loan may have restrictions on declaring the credit.
The procedure for claiming the ERC includes finishing the necessary forms and consisting of the credit on your employment income tax return (usually Type 941). The exact time it takes to process the credit can differ based upon a number of factors, consisting of the complexity of your business and the workload of the internal revenue service. It’s advised to seek advice from a tax professional for guidance specific to your circumstance.
There are numerous companies that can help with the procedure of claiming the ERC. These include accounting firms, tax advisory services, and payroll service providers. Some popular companies that offer assistance with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s recommended to research study and get in touch with these business directly to inquire about their costs and services.
Please keep in mind that the info supplied here is based on general understanding and may not show the most current updates or modifications to the ERC. It’s important to speak with a tax expert or visit the main internal revenue service site for the most updated and precise info concerning eligibility, claiming procedures, and available assistance.
Less than 100. The credit is based if the company had 100 or fewer staff members on average in 2019.
on wages paid to all employees whether they in fact worked or not. To put it simply, even if the.
workers worked full time and got paid for full time work, the employer still gets the credit.
Greater than 100. If the company had more than 100 employees usually in 2019, then the credit is.
enabled just for incomes paid to workers who did not work throughout the calendar quarter.
In both cases, “incomes” includes not just cash payments however also a part of the expense of employer.
provided health care. Employee Retention Credit Schedule C
Employers can be right away compensated for the credit by reducing the amount of payroll taxes they.