Lets talk first about Extension Of Employee Retention Credit :
Our team here what do these men doing everybody in this room is assisting teach people about ERC and uh constantly provide a beautiful breakfast and have individuals really learn more about the program we need to head to the room where we are able to display some of the checks that we are getting for companies and I want to see that what is this this is uh hundreds of millions of dollars actually Kevin numerous countless dollars so these are replicate copies of the letters that go to clients confirming that the check is on the method I imply you know if you simply start to 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 imply think of how many actual clients that went through the program yeah this is the very end this is the celebration at the end when the check is verified the numbers are confirmed and the check is on the mail in the mail from the internal revenue service heading to the customer so that’s how you’re able to track it you know when you
receive this you know the check is chosen sure which’s when they pay so they don’t pay anything until they really get the cash they don’t pay bottom line Wonder trust anything till this letter is verified the check is on the way they transfer it into their bank account and they can truly rely on Wonder trust that the process has actually been ended up and the number of you believe you’ve processed because you started this we’re about 35 000 of these for
about 6 billion dollars wow so clearly they know what they’re doing which’s what you require you need professionals on the other end of the phone to process this and get it to where you get one of these that’s what matters all right Mr Terrific here you’re at my YouTube channel we’re speaking about something really important today the staff member retention credit which most of you have actually never ever heard of I definitely had not become aware of it till very recently and found out a lot about it since this is probably the most affordable expense of capital for any small business anywhere
anytime if you have staff members in between 5 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 largest processor of these ERC credits this is a 170 page program so it’s difficult this isn’t like PPP we simply phone 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 us all about it and how to get it and why I have actually ended up being yes the Ambassador and paid spokesperson for this I enjoy this program it’s disappearing very soon you got to learn everything about it let’s talk employee retention credit Josh Fox what is an ERC let’s simply begin there so throughout the Trump Administration when President Trump was enacted they created the cares Act and the cares act used companies 3 chances 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 2 of them are loans and one’s a refund exactly so the ERC is a refund that’s.
fix the money cash payroll tax refund all right go on sorry I just need to make sure 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 speaking 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 initial cares Act is the ERC and yes Kevin it is a gorgeous difficult check in the mail where you get real money 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 worker retention credit that person had to be a worker so I’m going to make the Assumption this money is not for the owner not for people on the cap table not for shareholders it’s for workers right you needed to have actually owned a service 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 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 correct so there were six quarters the program was open well walk us through the 6 quarters so you had quarters two three and 4 of 2020 and you had quarters one 2 and three of 2021. fine so that’s how it’s measured you have to be on the W-2 throughout that duration now let’s talk my favorite part cash how much can you get back per worker that was on a W-2 in those six quarters so the calculation in 2020 to be precise Kevin is 50 of the staff member’s salary to an optimum of five thousand dollars per employee for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the staff member’s salary to a maximum of seven thousand per quarter how did that take place um they just changed the rules in.
2021 versus because the turmoil of the pandemic so they wished to even get more to keep those workers on payroll 100 so if you can get 5 000 per person Max in twenty that was 50 in 2020 approximately 5 thousand Max and after that what takes place 21 000 Max in 2021 oh that’s how you create twenty six thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty 6 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 have 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 usually Kevin is if you took PPP money someplace around 10 thousand dollars a person so let’s state hypothetically you owned a dining establishment in New york city City where I’m from and you had a hundred staff members and you took PPP money you would still get a million dollar in the mail from the IRS so it’s big obviously now the big question is why does nobody understand about this since appearance when I first became aware of this when I initially satisfied Josh you know I have actually got great deals of investments in great deals of companies I’m a significant advocate for entrepreneurship in America and make lots of lots of financial investments in business owners of which lots of suffered through the pandemic when I initially became aware of this I called BS I don’t think it because I use the PPP we went through the money 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 deserved and we utilized them sensibly to stay alive during the pandemic so when I found out about this I said nah it can’t hold 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 understand that’s how misinformation is that there’s no info out there then a bunch of individuals informed me well you can’t get it because you took the PPP also not real so let’s ask Josh why does no one learn about the worker retention credit you understand what’s intriguing 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 huge 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 turmoil because keep in mind in the original cares act you might refrain from doing both programs so if you had actually done PPP you could refrain from doing ERC in the initial program and when they changed 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 government never made it clear to any person about how to.
do this does your CFO understand how to do this not truly she or he’s never ever done it previously do the banks do it nope the banks don’t do it the payroll companies yeah a few of them are doing it as a payroll business your accounting professional no your accounting professional’s never done this before unless you have an account that went into this business and bottom line my firm Kevin has stayed in business because 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 great deal of our big big business clients have dealt with bottom line to recuperate other government programs we have actually done sales tax and use tax unemployment tax work chance tax credits research and development tax credits unclaimed home property tax all of these other government programs.
The employee 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 approximately $10,000 in wages paid by an.
company whose service is fully or partially suspended because of COVID-19 or whose gross invoices.
decline by more than 50%.
Availability.
1. The credit is available to all companies despite size including tax exempt organizations. There are.
just two exceptions: (1) state and city governments and their instrumentalities and (2) small.
services who take Small company Loans.
2. To certify, the employer has to fulfill one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the employer’s business is fully or partly 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.
employer’s gross receipts exceed 80% of a comparable quarter in 2019 they no longer certify.
after completion of that quarter.
Calculation of the Credit.
The quantity of the credit is 50% of the certifying wages paid up to $10,000 in overall.
It is effective for salaries paid after March 13th and before December 31, 2020.
The meaning of qualifying incomes differs by whether an employer had, typically, basically than.
100 workers in 2019.
Business that focus on ERC filing assistance typically offer expertise and support to help companies navigate the complicated process of claiming the credit. They can offer different services, including:.
How is the employee retention credit calculated? Extension Of Employee Retention Credit
Eligibility Evaluation: These companies will evaluate your business’s eligibility for the ERC based upon factors such as your market, income, and operations. If you fulfill the requirements for the credit and determine the maximum credit quantity you can claim, they can help identify.
Documents and Calculation: ERC filing services will assist in gathering the needed documents, such as payroll records and financial declarations, to support your claim. They will likewise help calculate the credit quantity based upon eligible salaries and other qualifying costs.
Retroactive Claim Evaluation: If you are eligible to claim the ERC for previous quarters, these companies can review your previous payroll records and financials to determine possible opportunities for retroactive credits. They can help you change prior tax returns to declare these refunds.
Filing Support: Companies specializing in ERC filings will prepare and submit the essential kinds and paperwork in your place. This includes completing Form 941 or any other necessary tax return.
Compliance and Updates: ERC guidelines and guidance have evolved in time. These business remain updated with the latest changes and make sure that your filings comply with the most present standards. If the IRS demands additional information or performs an audit related to your ERC claim, they can also supply continuous assistance.
It is very important to research study and veterinarian any company using ERC filing assistance to guarantee their reliability and proficiency. Search for established companies with experience in tax and payroll services, or think about connecting to relied on accounting companies or tax experts who provide ERC submitting support.
Remember that while these business can provide important support, it’s always a good concept to have a standard understanding of the ERC requirements and procedure yourself. This will assist you make informed decisions and guarantee precise filings.
The Employee Retention Credit (ERC) is a refundable tax credit presented by the U.S. government as part of COVID-19 relief measures. The objective of the ERC is to encourage services to retain and pay their employees throughout the pandemic, even if their operations have actually been impacted.
Here are some key points about the ERC:.
Eligibility: The ERC is offered to qualified companies, consisting of for-profit companies, tax-exempt organizations, and particular governmental entities. To certify, employers need to meet one of two criteria:.
The business operations were fully or partially suspended due to a government order related to COVID-19.
Business experienced a substantial decrease in gross receipts. As discussed earlier, for 2021, a considerable decline is specified as a 20% decrease in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a considerable decline 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 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 quantity is equal to a percentage (approximately 70%) of qualified salaries paid to staff members, 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, companies that received a Paycheck Defense Program (PPP) loan were not eligible for the ERC. However, legislation passed in late 2020 and extended in 2021 enables companies to declare the ERC even if they received a PPP loan. The exact same earnings can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has actually been retroactively expanded and enhanced, enabling eligible employers to declare the credit for certified incomes paid as far back as March 13, 2020. This retroactive arrangement supplies a chance for businesses to change prior-year income tax return and receive refunds.
Claiming the Credit: Employers can claim the ERC by reporting it on their employment tax returns, generally Kind 941. If the credit goes beyond the quantity of employment taxes owed, the excess can be refunded to the company.
It is very important to keep in mind that the ERC arrangements and eligibility criteria have progressed gradually. The best course of action is to seek advice from a tax professional or check out the official internal revenue service website for the most updated and comprehensive info relating to the ERC, consisting of any current legal changes or updates.
To receive the ERC, a business must satisfy among the following criteria:.
The business operations were completely or partly suspended due to a federal government order related to COVID-19.
Business experienced a substantial decline in gross receipts. For 2021, a significant decline is defined as a 20% decline in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a considerable decrease is defined 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 immediately preceding quarter.
The ERC is offered to companies of all sizes, consisting of tax-exempt companies, however there are some exceptions. For instance, federal government entities and organizations that received a PPP loan might have restrictions on declaring the credit.
The process for declaring the ERC includes finishing the required forms and including the credit on your employment income tax return (normally Type 941). The exact time it requires to process the credit can vary based upon numerous factors, consisting of the intricacy of your service and the work of the internal revenue service. It’s advised to consult 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 offer support with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the info provided here is based upon general understanding and might not reflect the most recent updates or changes to the ERC. It’s important to seek advice from a tax expert or check out the official internal revenue service website for the most accurate and current information regarding 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 salaries paid to all staff members whether they really 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 employer had more than 100 employees usually in 2019, then the credit is.
enabled only for incomes paid to workers who did not work throughout the calendar quarter.
In both cases, “wages” consists of not simply cash payments but also a part of the cost of employer.
offered health care. Extension Of Employee Retention Credit
Payment.
Employers can be immediately reimbursed for the credit by decreasing the quantity of payroll taxes they.