Lets talk first about Engagement Letter For Employee Retention Credit :
Our team here what do these men doing everyone in this room is helping teach people about ERC and uh constantly supply a gorgeous breakfast and have people truly learn more about the program we must head to the space where we have the ability to display a few of the checks that we are getting for companies and I want to see that what is this this is uh numerous countless dollars literally Kevin numerous countless dollars so these are replicate copies of the letters that go to customers validating that the check is on the method I suggest you understand if you just begin to take a look at some of these here I suggest this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I indicate it’s simply I mean think of 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 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 have the ability to track it you know when you
get this you understand the check is chosen sure which’s when they pay so they don’t pay anything until they in fact receive the cash they do not pay bottom line Wonder trust anything up until this letter is verified the check is on the way they deposit it into their savings account and they can genuinely rely on Wonder trust that the process has actually been finished and how many you think you’ve processed since you began this we’re about 35 000 of these for
about 6 billion dollars wow so clearly they understand what they’re doing which’s what you need you require 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 talking about something actually essential today the worker retention credit which most of you have never ever heard of I definitely hadn’t heard of it up until very recently and learned a lot about it since this is most likely the most affordable cost of capital for any small business anywhere
anytime if you have workers 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 Ideas 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 call up your bank manager and say 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 become yes the Ambassador and paid representative for this I love 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 created the cares Act and the cares act provided businesses three opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly everybody it makes a huge difference right there two of them are loans and one’s a refund exactly so the ERC is a refund that’s.
correct the cash cash payroll tax refund all right go on sorry I just have to make certain we got that point I imply that’s a huge distinction a loan versus cash money I like cash cash 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 difficult check in the mail where you get actual money from the IRS all right so let’s talk about how it works since it sounds like to me if it’s a if it’s staff member retention credit that person had to be a staff member so I’m going to make the Presumption this money is not for the owner not for individuals on the cap table not for investors it’s for workers right you had to have actually owned a company but it’s based on you having W-2 staff members in America not 10.99. As long as you had W-2 workers 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 right so there were 6 quarters the program was open well stroll us through the 6 quarters so you had quarters 2 3 and 4 of 2020 and you had quarters one 2 and 3 of 2021. okay 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 money just how much can you return per staff member that was on a W-2 in those six quarters so the computation in 2020 to be exact Kevin is 50 of the worker’s wage to an optimum of five thousand dollars per staff member for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the staff member’s wage to an optimum of 7 thousand per quarter how did that take place um they just changed the rules in.
2021 versus due to the fact that the chaos 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 as much as 5 thousand Max and then what takes place 21 000 Max in 2021 oh that’s how you create twenty 6 thousand twenty one thousand to twenty twenty one plus five 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 6 thousand dollars so if you took PPP loan one and PPP loan 2 you would reduce the 26 000 so what we’re seeing typically Kevin is if you took PPP cash somewhere around ten 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 employees and you took PPP cash you would still get a million dollar in the mail from the IRS so it’s huge clearly now the big concern is why does no one learn about this due to the fact that appearance when I first heard about this when I initially satisfied Josh you know I have actually got lots of financial investments in great deals of business I’m a major advocate for entrepreneurship in America and make many many financial investments in business owners of which many suffered through the pandemic when I first found out about this I called BS I do not believe 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 utilized them sensibly to stay alive throughout the pandemic so when I heard about this I stated nah it can’t be true however when I dug around I even called to my political leader pals Governor Senators they didn’t learn about it I indicate that’s how you know that’s how false information is that there’s no information out there then a lot of individuals informed 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 no one know about the staff member retention credit you understand what’s interesting 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 mayhem since remember in the original cares act you might refrain from doing both programs so if you had actually done PPP you might not do ERC in the initial 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 federal government never made it clear to anyone about how to.
do this does your CFO understand how to do this not truly she or he’s never 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 business your accounting professional no your accountant’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 recover money for Fortune 500 Fortune 1000 companies so a lot of our huge big business customers have actually dealt with bottom line to recover other federal government programs we have actually 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 government programs.
The staff member retention tax credit is a broad based refundable tax credit developed to motivate.
companies to keep staff members on their payroll. The credit is 50% of approximately $10,000 in incomes paid by an.
company whose company is totally or partly suspended because of COVID-19 or whose gross receipts.
decrease by more than 50%.
1. The credit is offered 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.
companies who take Small company Loans.
2. To qualify, the employer needs to fulfill one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the employer’s company is fully or partly suspended by government order due to COVID-19.
during 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 exceed 80% of a comparable 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 overall.
It is effective for incomes paid after March 13th and before December 31, 2020.
The definition of qualifying earnings varies by whether a company had, usually, basically than.
100 workers in 2019.
Business that focus on ERC filing assistance normally supply competence and assistance to help businesses browse the intricate procedure of claiming the credit. They can offer different services, consisting of:.
How is the employee retention credit calculated? Engagement Letter For Employee Retention Credit
Eligibility Evaluation: These companies will evaluate your business’s eligibility for the ERC based on aspects such as your market, profits, and operations. They can help determine if you fulfill the requirements for the credit and recognize the maximum credit amount you can claim.
Documentation and Computation: ERC filing services will assist in collecting the essential documentation, such as payroll records and financial statements, to support your claim. They will also help compute the credit quantity based upon eligible salaries and other qualifying expenditures.
Retroactive Claim Review: If you are qualified to claim the ERC for previous quarters, these companies can examine your past payroll records and financials to recognize prospective opportunities for retroactive credits. They can assist you amend previous income tax return to declare these refunds.
Filing Support: Companies focusing on ERC filings will prepare and submit the essential types and documents on your behalf. This consists of completing Type 941 or any other required tax forms.
Compliance and Updates: ERC regulations and guidance have actually progressed over time. These companies stay updated with the current changes and ensure that your filings comply with the most current standards. They can also provide ongoing support if the IRS demands additional details or carries out an audit related to your ERC claim.
It is very important to research study and vet any company providing ERC filing support to guarantee their reliability and expertise. Search for established firms with experience in tax and payroll services, or consider reaching out to trusted accounting companies or tax professionals who provide ERC filing support.
Bear in mind that while these business can offer valuable support, it’s always an excellent idea to have a fundamental understanding of the ERC requirements and process yourself. This will help you make informed decisions and guarantee precise filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit presented by the U.S. federal government as part of COVID-19 relief steps. The goal of the ERC is to encourage companies 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 readily available to qualified employers, including for-profit businesses, tax-exempt organizations, and certain governmental entities. To certify, employers need to satisfy one of two requirements:.
The business operations were completely or partially suspended due to a federal government order related to COVID-19.
Business experienced a significant decline in gross invoices. As mentioned previously, for 2021, a considerable decrease is specified as a 20% decrease in gross invoices compared to the exact 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% decline in gross invoices 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 amounts to a portion (approximately 70%) of qualified earnings paid to workers, consisting of particular health insurance 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, companies that received a Paycheck Security Program (PPP) loan were not qualified for the ERC. However, legislation passed in late 2020 and extended in 2021 allows services to declare the ERC even if they received a PPP loan. However, the very same incomes can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively broadened and improved, enabling qualified employers to claim the credit for certified salaries paid as far back as March 13, 2020. This retroactive arrangement provides a chance for businesses to change prior-year income tax return and receive refunds.
Claiming the Credit: Companies can claim the ERC by reporting it on their work tax returns, usually Kind 941. If the credit exceeds the amount of employment taxes owed, the excess can be reimbursed to the employer.
It is very important to note that the ERC arrangements and eligibility requirements have actually evolved gradually. The best course of action is to speak with a tax expert or check out the main internal revenue service site for the most comprehensive and current information relating to the ERC, consisting of any recent legal changes or updates.
To receive the ERC, a service needs to meet one of the following criteria:.
Business operations were fully or partially suspended due to a federal government order related to COVID-19.
The business experienced a significant decline in gross invoices. For 2021, a substantial decrease is specified as a 20% decrease in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a considerable decrease is specified as a 20% decrease in gross receipts compared to the same quarter in 2019, or a 20% decrease in gross receipts compared to the right away preceding quarter.
The ERC is readily available to services of all sizes, including tax-exempt companies, however there are some exceptions. For example, government entities and services that got a PPP loan may have limitations on declaring the credit.
The procedure for claiming the ERC includes completing the required types and including 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 business and the work of the IRS. It’s advised to consult with a tax expert for guidance specific to your situation.
There are numerous business that can assist with the process of claiming the ERC. These consist of accounting companies, tax advisory services, and payroll service providers. Some widely known business that offer help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s advisable to research and contact these companies directly to inquire about their fees and services.
Please note that the info supplied here is based upon general understanding and may not reflect the most current updates or modifications to the ERC. It is very important to speak with a tax professional or check out the official internal revenue service site for the most precise and up-to-date info regarding eligibility, claiming procedures, and offered help.
Less than 100. The credit is based if the employer had 100 or less workers on average in 2019.
on incomes paid to all staff members whether they actually worked or not. Simply put, even if the.
workers worked full time and got paid for full-time work, the employer still gets the credit.
Greater than 100. The credit is if the employer had more than 100 staff members on average in 2019.
allowed just for earnings paid to staff members who did not work during the calendar quarter.
In both cases, “incomes” consists of not simply cash payments however also a portion of the expense of company.
supplied health care. Engagement Letter For Employee Retention Credit
Employers can be immediately reimbursed for the credit by reducing the amount of payroll taxes they.