Lets talk first about Enhanced Employee Retention Credit :
Our team here what do these guys doing everyone in this space is helping teach individuals about ERC and uh constantly offer a stunning 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 ‘d like to see that what is this this is uh hundreds of millions of dollars literally Kevin numerous countless dollars so these are duplicate copies of the letters that go to customers validating that the check is on the method I imply you know if you just begin to look at a few of these here I mean this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I indicate it’s just I imply think of the number of real clients 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 confirmed and the check is on the mail in the mail from the IRS 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 chosen sure and that’s when they pay so they do not pay anything until they in fact receive the money they do not pay bottom line Wonder trust anything till this letter is validated the check is on the way they transfer it into their bank account and they can genuinely rely on Wonder trust that the process has actually been finished and how many you think you’ve processed given that you started this we’re about 35 000 of these for
about 6 billion dollars wow so clearly they understand what they’re doing and that’s what you require you require 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 Terrific here you’re at my YouTube channel we’re speaking about something truly essential today the staff member retention credit which the majority of you have never become aware of I certainly hadn’t heard of it up until very just recently and found out 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 employees in between five and five hundred so I’ve got the professional with me this is Josh Fox he’s the founder and CEO of bottom line Ideas they’re the largest 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 supervisor and say offer 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 become yes the Ambassador and paid spokesperson for this I love this program it’s disappearing very soon you got to find out everything about it let’s talk staff member retention credit Josh Fox what is an ERC let’s simply begin there so during the Trump Administration when President Trump was enacted they developed the cares Act and the cares act provided services 3 opportunities 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 precisely so the ERC is a refund that’s.
fix the cash cash payroll tax refund alright go on sorry I simply have to ensure we got that point I indicate that’s a huge difference a loan versus cash cash I like cash money that’s what we’re speaking about okay 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 stunning hard check in the mail where you get actual money from the internal revenue service all right so let’s discuss how it works because it seems 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 Presumption this cash is not for the owner not for people on the cap table not for investors it’s for staff members right you needed to have actually owned a service but it’s based on you having W-2 employees 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 appropriate so there were six quarters the program was open well walk us through the six quarters so you had quarters 2 3 and four of 2020 and you had quarters one 2 and three of 2021. all right so that’s how it’s determined you need to be on the W-2 throughout that duration now let’s talk my preferred part money how much can you get back per staff member that was on a W-2 in those six quarters so the computation in 2020 to be precise Kevin is 50 of the staff member’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 employee’s salary to an optimum of seven thousand per quarter how did that take place um they just altered the rules in.
2021 versus since the mayhem 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 up to five thousand Max and after that what happens 21 000 Max in 2021 oh that’s how you develop twenty six thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty six thousand dollars per employee that is since 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 2 you would lower the 26 000 so what we’re seeing usually Kevin is if you took PPP cash someplace around ten 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 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 certainly now the big concern is why does nobody know about this since appearance when I initially found out about this when I first satisfied Josh you understand I have actually got great deals of financial investments in great deals of companies I’m a significant advocate for entrepreneurship in America and make many lots of financial investments in business owners of which numerous suffered through the pandemic when I first became aware of 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 extremely 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 survive during the pandemic so when I found out about this I stated nah it can’t be true but when I dug around I even contacted us to my political leader friends Governor Senators they didn’t learn about it I mean that’s how you know that’s how false information is that there’s no information out there then a bunch of individuals told me well you can’t get it since you took the PPP likewise not real so let’s ask Josh why does no one learn about the employee retention credit you understand what’s fascinating you’re speaking about the banks Kevin due to the fact that in the PPP loan process the federal government made it extremely clear that if you desired a PPP loan you would call Wells Fargo Citibank Bank of America any of the huge banks in our nation and they would process process in Canada a pre-pp loan there’s no loans in Canada by the way it’s simply procedure procedure that’s all um and here there was mayhem since remember in the initial cares act you could 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 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 he or she’s never ever done it previously do the banks do it nope the banks do not do it the payroll companies yeah some of them are doing it as a payroll company your accounting professional no your accountant’s never done this prior to unless you have an account that entered into this service and bottom line my company Kevin has stayed in business because 2009 and we have actually been dealing with the federal government and the state government to recover money for Fortune 500 Fortune 1000 companies so a great deal of our big big corporate customers have actually dealt with bottom line to recuperate other federal government programs we’ve 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 developed to encourage.
employers to keep workers on their payroll. The credit is 50% of approximately $10,000 in incomes paid by an.
company whose organization is totally or partially suspended because of COVID-19 or whose gross receipts.
decline by more than 50%.
1. The credit is offered to all companies despite size including tax exempt organizations. There are.
just 2 exceptions: (1) state and local governments and their instrumentalities and (2) little.
businesses who take Small company Loans.
2. To certify, the employer needs to fulfill one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the employer’s organization is fully or partially suspended by government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross invoices are below 50% of the similar quarter in 2019. As soon as the.
company’s gross invoices go above 80% of a comparable 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 wages paid up to $10,000 in total.
It works for incomes paid after March 13th and before December 31, 2020.
The definition of qualifying earnings varies by whether an employer had, on average, more or less than.
100 workers in 2019.
Business that specialize in ERC filing help typically offer knowledge and support to help organizations browse the intricate process of claiming the credit. They can provide various services, including:.
How is the employee retention credit calculated? Enhanced Employee Retention Credit
Eligibility Assessment: These companies will evaluate your service’s eligibility for the ERC based upon aspects such as your market, revenue, and operations. They can help determine if you meet the requirements for the credit and recognize the optimum credit amount you can claim.
Documentation and Estimation: ERC filing services will assist in gathering the necessary paperwork, such as payroll records and financial statements, to support your claim. They will likewise assist compute the credit quantity based upon qualified wages and other qualifying expenses.
Retroactive Claim Evaluation: If you are qualified to claim the ERC for previous quarters, these business can evaluate your previous payroll records and financials to recognize possible chances for retroactive credits. They can assist you change previous income tax return to declare these refunds.
Filing Support: Companies specializing in ERC filings will prepare and submit the necessary kinds and documents in your place. This includes finishing Kind 941 or any other necessary tax forms.
Compliance and Updates: ERC regulations and assistance have actually developed gradually. These business stay upgraded with the most recent changes and guarantee that your filings comply with the most present guidelines. If the IRS demands extra info or performs an audit related to your ERC claim, they can likewise provide continuous assistance.
It is necessary to research study and vet any company using ERC filing help to guarantee their trustworthiness and competence. Look for recognized companies with experience in tax and payroll services, or think about connecting to trusted accounting firms or tax specialists who use ERC submitting support.
Bear in mind that while these business can supply important assistance, it’s always an excellent concept to have a fundamental understanding of the ERC requirements and process yourself. This will assist you make informed decisions and make sure precise filings.
The Worker Retention Credit (ERC) is a refundable tax credit presented by the U.S. federal government as part of COVID-19 relief measures. The objective of the ERC is to motivate businesses to keep and pay their staff members 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 services, tax-exempt companies, and particular governmental entities. To qualify, companies should satisfy one of two requirements:.
The business operations were totally or partly suspended due to a federal government order related to COVID-19.
The business experienced a significant decrease in gross receipts. As discussed earlier, for 2021, a significant decrease is specified as a 20% decline in gross invoices compared to the exact 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% decline in gross receipts compared to the instantly preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit quantity is equal to a portion (approximately 70%) of certified earnings paid to workers, consisting of certain 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 received an Income Security Program (PPP) loan were not eligible for the ERC. However, legislation passed in late 2020 and extended in 2021 enables companies to claim the ERC even if they got a PPP loan. However, the exact same wages can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively broadened and improved, permitting eligible companies to declare the credit for qualified wages paid as far back as March 13, 2020. This retroactive provision supplies an opportunity for businesses to amend prior-year income tax return and receive refunds.
Claiming the Credit: Employers can declare the ERC by reporting it on their employment income tax return, normally Type 941. The excess can be refunded to the company if the credit surpasses the quantity of employment taxes owed.
It’s important to keep in mind that the ERC provisions and eligibility criteria have progressed over time. The best course of action is to consult with a tax expert or go to the official IRS site for the most up-to-date and in-depth information concerning the ERC, consisting of any recent legislative modifications or updates.
To receive the ERC, a company must meet among the following requirements:.
Business operations were fully or partly suspended due to a government order related to COVID-19.
Business experienced a considerable decline in gross invoices. For 2021, a substantial decrease is specified as a 20% decrease in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a considerable decrease is specified as a 20% decrease 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 readily available to businesses of all sizes, including tax-exempt organizations, however there are some exceptions. For example, government entities and organizations that got a PPP loan might have restrictions on claiming the credit.
The procedure for declaring the ERC involves finishing the necessary types and including the credit on your employment tax return (typically Kind 941). The exact time it requires to process the credit can differ based upon several elements, consisting of the intricacy of your business and the work of the internal revenue service. It’s advised to talk to a tax expert for guidance specific to your circumstance.
There are numerous companies that can help with the process of claiming the ERC. These consist of accounting firms, tax advisory services, and payroll provider. Some widely known companies that provide help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s recommended to research and get in touch with these business directly to inquire about their services and costs.
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 is essential to talk to a tax expert or go to the official IRS site for the most precise and current details regarding eligibility, declaring procedures, and readily available assistance.
Less than 100. If the company had 100 or less employees typically in 2019, then the credit is based.
on wages paid to all staff members whether they actually worked or not. Simply put, even if the.
staff members worked full time and got paid for full-time work, the company still gets the credit.
Greater than 100. If the company had more than 100 staff members usually in 2019, then the credit is.
permitted only for wages paid to staff members who did not work during the calendar quarter.
In both cases, “earnings” consists of not just cash payments but also a part of the expense of employer.
provided health care. Enhanced Employee Retention Credit
Employers can be immediately repaid for the credit by reducing the amount of payroll taxes they.