Lets talk first about Employee Retention Credits :
Our group here what do these men doing everyone in this space is helping teach people about ERC and uh constantly supply a beautiful breakfast and have individuals actually find out about the program we ought to head to the space where we have the ability to show a few of the checks that we are getting for companies and I wish to see that what is this this is uh numerous millions of dollars actually Kevin numerous countless dollars so these are duplicate copies of the letters that go to clients verifying that the check is on the method I imply you know if you simply begin 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 simply I mean consider 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 confirmed 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 chosen sure and that’s when they pay so they do not pay anything until they actually get the cash they don’t 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 truly rely on Wonder trust that the procedure has actually been ended up and the number of you think you have actually processed because you began this we have to do with 35 000 of these for
about six billion dollars wow so plainly they know what they’re doing and that’s what you require you need specialists 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 actually important today the staff member retention credit which most of you have actually never heard of I certainly had not heard of it up until very recently and found out a lot about it due to the fact that this is probably the lowest expense of capital for any small company anywhere
anytime if you have workers between five and five hundred so I have actually got the professional with me this is Josh Fox he’s the founder and CEO of bottom line Concepts 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 call your bank manager and say provide 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 have actually ended up being yes the Ambassador and paid representative for this I like this program it’s going away very soon you got to learn all about it let’s talk worker retention credit Josh Fox what is an ERC let’s simply start there so throughout the Trump Administration when President Trump was enacted they developed the cares Act and the cares act provided companies three 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 difference right there 2 of them are loans and one’s a refund exactly so the ERC is a refund that’s.
remedy the money cash payroll tax refund all right go on sorry I simply need to make certain we got that point I indicate that’s a big distinction a loan versus cash cash I like money money that’s what we’re discussing alright 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 hard 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 needed to be a worker so I’m going to make the Presumption this cash is not for the owner not for people on the cap table not for shareholders it’s for staff members right you needed to have owned a company but 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 eligible so you have to be on payroll in 2020 on the W-2 and you have to be on payroll for the first six months of 2021 on the W-2 appropriate so there were 6 quarters the program was open well walk us through the six quarters so you had quarters 2 3 and 4 of 2020 and you had quarters one two and 3 of 2021. alright so that’s how it’s measured you need to be on the W-2 during that period now let’s talk my preferred part cash how much can you get back per employee 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 salary to an optimum of five thousand dollars per employee for the year of 2020 and in 2021 the numbers escalated to 70 of the worker’s wage to a maximum of 7 thousand per quarter how did that occur um they just altered the rules in.
2021 versus because 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 takes place 21 000 Max in 2021 oh that’s how you come up with twenty six thousand twenty one thousand to twenty twenty one plus five thousand in twenty twenty that’s twenty six thousand dollars per employee that is because that’s a lot of money it is now there’s a caution here the PPP money would need to be lowered from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan two you would decrease the 26 000 so what we’re seeing on average Kevin is if you took PPP money somewhere around ten thousand dollars an individual so let’s say hypothetically you owned a restaurant in New york city 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 internal revenue service so it’s huge clearly now the big concern is why does nobody know about this due to the fact that appearance when I first became aware of this when I initially met Josh you understand I have actually got lots of investments in lots of companies I’m a major advocate for entrepreneurship in America and make numerous lots of investments in entrepreneurs of which numerous suffered through the pandemic when I first became aware of this I called BS I don’t 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 and that 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 hold true but when I dug around I even contacted us to my politician good friends Guv Senators they didn’t know about it I indicate that’s how you understand that’s how misinformation 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 likewise not true so let’s ask Josh why does nobody know about the worker retention credit you know what’s interesting you’re discussing the banks Kevin because 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 process process that’s all um and here there was chaos due to the fact that remember in the original cares act you might not do both programs so if you had done PPP you could not do ERC in the original program and when they altered the law in 2021 the banks were not doing ERC because it’s not alone so you’re getting a tax refund so the government never made it clear to any person about how to.
do this does your CFO know how to do this not really he or she’s never ever done it in the past 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 accounting professional’s never done this before unless you have an account that entered into this service and bottom line my firm Kevin has actually been in business since 2009 and we have actually been working with the federal government and the state government to recuperate cash for Fortune 500 Fortune 1000 business so a lot of our huge huge business customers have actually worked with bottom line to recuperate other federal government programs we’ve done sales tax and use tax unemployment tax work opportunity tax credits research and development tax credits unclaimed home real estate tax all of these other federal government programs.
The staff member retention tax credit is a broad based refundable tax credit created to motivate.
employers to keep staff members on their payroll. The credit is 50% of as much as $10,000 in earnings paid by an.
Since of COVID-19 or whose gross receipts, company whose service is totally or partly suspended.
decrease by more than 50%.
1. The credit is offered to all employers no matter size including tax exempt organizations. There are.
just 2 exceptions: (1) state and city governments and their instrumentalities and (2) little.
organizations who take Small company 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 organization is fully or partially suspended by federal government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross receipts are below 50% of the similar quarter in 2019. Once the.
employer’s gross receipts exceed 80% of a similar quarter in 2019 they no longer certify.
after the end of that quarter.
Estimation of the Credit.
The amount of the credit is 50% of the qualifying incomes paid up to $10,000 in total.
It is effective for wages paid after March 13th and before December 31, 2020.
The definition of qualifying wages varies by whether a company had, on average, basically than.
100 employees in 2019.
Companies that focus on ERC filing help typically provide proficiency and support to assist businesses browse the intricate process of claiming the credit. They can provide different services, including:.
How is the employee retention credit calculated? Employee Retention Credits
Eligibility Evaluation: These business will evaluate your business’s eligibility for the ERC based on factors such as your market, income, and operations. They can help identify if you fulfill the requirements for the credit and identify the maximum credit quantity you can declare.
Documentation and Computation: ERC filing services will help in collecting the needed paperwork, such as payroll records and monetary declarations, to support your claim. They will likewise help calculate the credit quantity based on eligible incomes and other certifying expenditures.
Retroactive Claim Evaluation: If you are qualified to declare the ERC for prior quarters, these business can review 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 Assistance: Companies concentrating on ERC filings will prepare and submit the necessary types and documents in your place. This includes completing Form 941 or any other necessary tax return.
Compliance and Updates: ERC policies and assistance have developed gradually. These business stay updated with the current modifications and guarantee that your filings adhere to the most present standards. They can also offer continuous support if the IRS requests additional details or performs an audit related to your ERC claim.
It is very important to research study and veterinarian any business providing ERC filing support to guarantee their credibility and know-how. Look for recognized firms with experience in tax and payroll services, or consider reaching out to relied on accounting firms or tax professionals who use ERC filing assistance.
Remember that while these business can supply valuable support, it’s always a good idea to have a fundamental understanding of the ERC requirements and procedure yourself. This will help you make informed decisions and make sure accurate filings.
The Worker Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief procedures. The objective of the ERC is to encourage businesses to maintain and pay their staff members throughout the pandemic, even if their operations have actually been impacted.
Here are some key points about the ERC:.
Eligibility: The ERC is available to eligible employers, consisting of for-profit companies, tax-exempt companies, and particular governmental entities. To qualify, companies should meet one of two requirements:.
The business operations were totally or partly suspended due to a government order related to COVID-19.
The business experienced a significant decrease in gross receipts. As mentioned earlier, for 2021, a substantial decline is defined as a 20% decline in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a substantial decrease is specified as a 20% decline in gross invoices compared to the same quarter in 2019, or a 20% decrease in gross invoices compared to the immediately preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the employer’s share of Social Security taxes. The credit quantity amounts to a portion (up to 70%) of certified wages paid to staff members, including specific health plan expenditures. 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 received a Paycheck Protection Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 enables companies to declare the ERC even if they got a PPP loan. The exact same incomes can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively broadened and improved, permitting qualified employers to declare the credit for certified incomes paid as far back as March 13, 2020. This retroactive provision offers a chance for organizations to modify prior-year tax returns and receive refunds.
Declaring the Credit: Companies can declare the ERC by reporting it on their employment income tax return, normally Form 941. The excess can be refunded to the company if the credit goes beyond the quantity of work taxes owed.
It is necessary to note that the ERC arrangements and eligibility criteria have evolved gradually. The best course of action is to talk to a tax expert or check out the official internal revenue service website for the most current and in-depth details relating to the ERC, consisting of any recent legislative modifications or updates.
To receive the ERC, a business should satisfy among the following requirements:.
Business operations were totally or partially suspended due to a federal government order related to COVID-19.
Business experienced a significant decrease in gross invoices. For 2021, a substantial decline is specified as a 20% decrease in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a significant decline is defined as a 20% decrease in gross invoices compared to the very same quarter in 2019, or a 20% decline in gross receipts compared to the right away preceding quarter.
The ERC is available to organizations of all sizes, consisting of tax-exempt organizations, but there are some exceptions. For instance, government entities and businesses that received a PPP loan may have limitations on claiming the credit.
The procedure for claiming the ERC includes finishing the required forms and including the credit on your work income tax return (generally Form 941). The exact time it takes to process the credit can differ based upon a number of elements, including the intricacy of your service and the work of the IRS. It’s recommended to speak with a tax professional for guidance specific to your situation.
There are numerous companies that can assist with the process of declaring the ERC. Some well-known companies that use help with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the info offered here is based upon general understanding and may not show the most recent updates or changes to the ERC. It’s important to consult with a tax professional or visit the official internal revenue service site for the most up-to-date and accurate details concerning eligibility, claiming procedures, and readily available help.
Less than 100. If the employer had 100 or fewer employees usually in 2019, then the credit is based.
on incomes paid to all employees whether they in fact worked or not. To put it simply, 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.
enabled only for incomes paid to employees who did not work during the calendar quarter.
In both cases, “incomes” consists of not just cash payments but likewise a portion of the cost of company.
provided healthcare. Employee Retention Credits
Employers can be right away reimbursed for the credit by reducing the amount of payroll taxes they.