Lets talk first about Employee Retention Credits Cares Act :
Our group here what do these guys doing everybody in this space is helping teach people about ERC and uh always provide a gorgeous breakfast and have individuals truly learn more about the program we need to head to the space where we have the ability to show some of the checks that we are getting for companies and I ‘d like to see that what is this this is uh hundreds of countless dollars literally Kevin numerous countless dollars so these are duplicate copies of the letters that go to customers verifying that the check is on the method I imply you know if you simply start to look at a few of these here I suggest this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I imply it’s just I suggest think about how many real customers that went through the program yeah this is the very end this is the party at the end when the check is verified the numbers are validated 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
get this you know the check is gone for sure which’s when they pay so they do not pay anything till they really receive the money they don’t pay bottom line Wonder trust anything until this letter is confirmed the check is on the method they transfer it into their checking account and they can really trust Wonder trust that the process has actually been ended up and how many you believe you’ve processed because you began this we have to do with 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 among these that’s what matters all right Mr Wonderful here you’re at my YouTube channel we’re speaking about something really important today the employee retention credit which most of you have never become aware of I definitely had not become aware of it up until very just recently and learned a lot about it since this is probably the most affordable expense of capital for any small business anywhere
anytime if you have employees in between 5 and five hundred so I have actually got the professional 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 not easy this isn’t like PPP we simply call up your bank manager and say give me a loan it does not work there’s not a loan it’s an application and Josh is going to tell all of us about it and how to get it and why I’ve become yes the Ambassador and paid representative for this I enjoy this program it’s going away soon you got to find out everything about it let’s talk employee retention credit Josh Fox what is an ERC let’s just start there so throughout the Trump Administration when President Trump was enacted they came up with the cares Act and the cares act used companies 3 opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically everyone 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.
remedy the cash money payroll tax refund fine go on sorry I just have to make certain we got that point I mean that’s a huge distinction a loan versus money 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 difficult check in the mail where you get actual money from the IRS all right so let’s discuss how it works because it seems like to me if it’s a if it’s staff member retention credit that individual needed to be a staff member 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 owned an organization but it’s based on 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 very first six months of 2021 on the W-2 right so there were six 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 3 of 2021. okay 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 6 quarters so the estimation in 2020 to be exact Kevin is 50 of the worker’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 staff member’s salary to an optimum of seven thousand per quarter how did that take place 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 staff members 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 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 employee that is since that’s a lot of cash it is now there’s a caution 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 minimize the 26 000 so what we’re seeing typically Kevin is if you took PPP cash someplace around 10 thousand dollars an individual so let’s state hypothetically you owned a restaurant in New York City where I’m from and you had a hundred workers and you took PPP money you would still get a million dollar in the mail from the IRS so it’s huge clearly now the big question is why does nobody know about this since appearance when I first became aware of this when I initially fulfilled Josh you understand I’ve got lots of financial investments in great deals of companies I’m a major supporter for entrepreneurship in America and make lots of numerous investments in business owners of which many suffered through the pandemic when I first became aware of this I called BS I don’t believe it since 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 which were well should have and we utilized them sensibly to stay alive 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 called to my politician friends Guv Senators they didn’t understand about it I mean that’s how you know that’s how misinformation is that there’s no information out there then a bunch 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 employee retention credit you know what’s intriguing you’re talking about the banks Kevin since in the PPP loan process 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 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 chaos because remember 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 initial program and when they altered 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 federal 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 some of them are doing it as a payroll company your accountant no your accountant’s never ever done this before unless you have an account that entered into this company and bottom line my firm Kevin has actually stayed in business considering that 2009 and we have actually been dealing with the federal government and the state federal government to recover money for Fortune 500 Fortune 1000 companies so a lot of our huge huge corporate customers have actually worked with bottom line to recuperate other federal government programs we have actually done sales tax and use tax joblessness tax work opportunity tax credits research and development tax credits unclaimed home real estate tax all of these other federal government programs.
The employee retention tax credit is a broad based refundable tax credit developed to motivate.
employers to keep staff members on their payroll. The credit is 50% of approximately $10,000 in incomes paid by an.
company whose organization is completely or partly suspended because of COVID-19 or whose gross invoices.
decrease by more than 50%.
1. The credit is available to all employers regardless of size consisting of tax exempt companies. There are.
just 2 exceptions: (1) state and local governments and their instrumentalities and (2) small.
services who take Small Business Loans.
2. To certify, the employer needs to meet one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the employer’s business 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 below 50% of the similar quarter in 2019. Once the.
company’s gross receipts go above 80% of a comparable quarter in 2019 they no longer certify.
after completion of that quarter.
Computation of the Credit.
The quantity of the credit is 50% of the certifying wages paid up to $10,000 in total.
It works for salaries paid after March 13th and before December 31, 2020.
The meaning of certifying salaries varies by whether a company had, on average, basically than.
100 staff members in 2019.
Companies that concentrate on ERC filing assistance usually offer proficiency and support to assist services browse the intricate process of claiming the credit. They can provide various services, including:.
How is the employee retention credit calculated? Employee Retention Credits Cares Act
Eligibility Assessment: These business will examine your organization’s eligibility for the ERC based upon factors such as your market, profits, and operations. If you satisfy the requirements for the credit and identify the maximum credit amount you can claim, they can help figure out.
Documents and Computation: ERC filing services will help in gathering the required documentation, such as payroll records and monetary statements, to support your claim. They will likewise help determine the credit amount based upon qualified incomes and other certifying costs.
Retroactive Claim Evaluation: If you are qualified to claim the ERC for prior quarters, these companies can evaluate your past payroll records and financials to recognize prospective chances for retroactive credits. They can assist you change previous tax returns to declare these refunds.
Filing Assistance: Business specializing in ERC filings will prepare and submit the required types and documents in your place. This includes completing Type 941 or any other required tax forms.
Compliance and Updates: ERC guidelines and assistance have developed with time. These companies remain upgraded with the current modifications and ensure that your filings abide by the most existing guidelines. If the IRS demands additional details or performs an audit related to your ERC claim, they can also supply continuous support.
It’s important to research study and veterinarian any company providing ERC filing assistance to guarantee their trustworthiness and expertise. Look for recognized firms with experience in tax and payroll services, or consider reaching out to trusted accounting companies or tax professionals who offer ERC submitting support.
Keep in mind that while these companies can supply valuable assistance, it’s always a great idea to have a standard understanding of the ERC requirements and procedure yourself. This will help you make notified decisions and make sure accurate filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit introduced by the U.S. federal government as part of COVID-19 relief procedures. 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 available to qualified companies, consisting of for-profit businesses, tax-exempt companies, and specific governmental entities. To qualify, companies should fulfill one of two requirements:.
Business operations were completely or partially suspended due to a federal government order related to COVID-19.
Business experienced a considerable decline in gross receipts. As mentioned previously, for 2021, a considerable decrease is specified as a 20% decrease in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a significant 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 right away preceding quarter.
Credit Amount: The ERC is a refundable tax credit that offsets the employer’s share of Social Security taxes. The credit amount is equal to a portion (approximately 70%) of certified incomes paid to employees, consisting of certain health insurance 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, businesses that received an Income Defense Program (PPP) loan were not eligible for the ERC. However, legislation passed in late 2020 and extended in 2021 enables businesses to claim the ERC even if they got a PPP loan. The same salaries can not be utilized to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively broadened and enhanced, allowing eligible companies to declare the credit for certified earnings paid as far back as March 13, 2020. This retroactive provision provides a chance for businesses to modify prior-year income tax return and receive refunds.
Declaring the Credit: Employers can claim the ERC by reporting it on their work income tax return, typically Form 941. If the credit surpasses the quantity of employment taxes owed, the excess can be refunded to the employer.
It is very important to note that the ERC provisions and eligibility requirements have actually developed over time. The very best course of action is to talk to a tax professional or check out the official internal revenue service site for the most in-depth and up-to-date information regarding the ERC, including any recent legislative changes or updates.
To qualify for the ERC, a company needs to satisfy one of the following criteria:.
The business operations were totally or partially suspended due to a government order related to COVID-19.
Business experienced a significant decline in gross receipts. For 2021, a significant decline is specified as a 20% decline in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a considerable decline is specified as a 20% decline in gross invoices compared to the exact same quarter in 2019, or a 20% decline in gross receipts compared to the instantly preceding quarter.
The ERC is available to services of all sizes, including tax-exempt organizations, but there are some exceptions. Federal government entities and companies that got a PPP loan might have constraints on claiming the credit.
The process for claiming the ERC includes completing the necessary kinds and consisting of the credit on your employment income tax return (usually Form 941). The exact time it requires to process the credit can differ based upon numerous elements, including the complexity of your business and the workload of the IRS. It’s suggested to consult with a tax professional for assistance specific to your circumstance.
There are a number of companies that can assist with the procedure of claiming the ERC. These include accounting companies, tax advisory services, and payroll company. Some well-known companies that offer assistance with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s suggested to research and contact these business straight to inquire about their services and costs.
Please note that the details offered here is based upon general knowledge and might not show the most recent updates or modifications to the ERC. It’s important to speak with a tax professional or visit the official IRS website for the most current and accurate info relating to eligibility, claiming treatments, and readily available help.
Less than 100. The credit is based if the employer had 100 or less workers on average in 2019.
on wages paid to all staff members whether they actually worked or not. To put it simply, even if the.
employees worked full-time and got paid for full-time work, the employer still gets the credit.
Greater than 100. If the employer had more than 100 workers typically in 2019, then the credit is.
enabled only for incomes paid to workers who did not work during the calendar quarter.
In both cases, “incomes” consists of not simply cash payments however likewise a portion of the cost of employer.
offered healthcare. Employee Retention Credits Cares Act
Employers can be right away repaid for the credit by reducing the quantity of payroll taxes they.