Lets talk first about How Do You File For The Employee Retention Credit :
Our group here what do these guys doing everybody in this space is assisting teach individuals about ERC and uh always offer a gorgeous breakfast and have individuals actually discover the program we must head to the room where we have the ability to show a few of the checks that we are getting for business and I want to see that what is this this is uh numerous countless dollars actually Kevin numerous millions of dollars so these are duplicate copies of the letters that go to customers verifying that the check is on the method I indicate you understand if you simply 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 imply it’s just I imply think of the number of real customers 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 validated and the check is on the mail in the mail from the internal revenue service heading to the customer so that’s how you have the ability to track it you know when you
get this you understand the check is chosen sure and that’s when they pay so they do not pay anything until they in fact get the cash they do not pay bottom line Wonder trust anything till this letter is verified 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 have actually processed because you started this we’re about 35 000 of these for
about 6 billion dollars wow so plainly they know what they’re doing which’s what you need 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 Fantastic here you’re at my YouTube channel we’re speaking about something really crucial today the employee retention credit which the majority of you have never heard of I certainly had not become aware of it up until very just recently and found out a lot about it because this is most likely the lowest cost of capital for any small business anywhere
anytime if you have employees between 5 and five hundred so I’ve got the professional with me this is Josh Fox he’s the creator and CEO of bottom line Principles they’re the largest processor of these ERC credits this is a 170 page program so it’s hard this isn’t like PPP we just 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 inform all of us about it and how to get it and why I’ve ended up being yes the Ambassador and paid spokesperson for this I love this program it’s going away soon you got to learn everything about it let’s talk employee retention credit Josh Fox what is an ERC let’s just begin there so throughout the Trump Administration when President Trump was enacted they developed the cares Act and the cares act offered businesses 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 huge difference right there two of them are loans and one’s a refund exactly so the ERC is a refund that’s.
fix the cash money payroll tax refund alright go on sorry I simply need to ensure we got that point I imply that’s a huge distinction a loan versus money 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 initial 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 discuss how it works since it sounds like to me if it’s a if it’s employee retention credit that individual needed 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 employees right you had to have owned an organization however it’s based on 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 right so there were 6 quarters the program was open well walk us through the 6 quarters so you had quarters two three and four of 2020 and you had quarters one two and 3 of 2021. fine so that’s how it’s measured you have to be on the W-2 during that period 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 estimation in 2020 to be specific Kevin is 50 of the worker’s salary to an optimum of 5 thousand dollars per staff member for the year of 2020 and in 2021 the numbers increased to 70 of the staff member’s wage to an optimum of seven thousand per quarter how did that occur um they simply changed the rules in.
2021 versus due to the fact that the chaos 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 as much as five thousand Max and after that what occurs 21 000 Max in 2021 oh that’s how you develop twenty 6 thousand twenty one thousand to twenty twenty one plus five thousand in twenty twenty that’s twenty six thousand dollars per worker that is since that’s a great deal of cash it is now there’s a caution here the PPP money would have to be decreased 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 cash somewhere around ten thousand dollars a person so let’s say hypothetically you owned a restaurant in New York 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 internal revenue service so it’s huge clearly now the huge concern is why does no one know about this since appearance when I initially found out about this when I first fulfilled Josh you understand I have actually got lots of investments in great deals of companies I’m a major advocate for entrepreneurship in America and make numerous numerous financial investments in entrepreneurs of which numerous suffered through the pandemic when I initially became aware of this I called BS I do not believe it since I use the PPP we went through the money center Banks to get it it was very easy to do we had our CEOs call the banks they got their loans and that were well should have and we used them wisely to stay alive during the pandemic so when I became aware of this I stated nah it can’t hold true but when I dug around I even contacted us to my politician pals Guv Senators they didn’t learn about it I imply 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 true so let’s ask Josh why does no one know about the employee retention credit you understand what’s intriguing you’re talking about the banks Kevin since in the PPP loan procedure 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 procedure 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 because keep in mind in the initial cares act you might not do both programs so if you had done PPP you could refrain from doing ERC in the initial program and when they changed 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 ever made it clear to anyone about how to.
do this does your CFO know how to do this not really she or he’s never ever done it before do the banks do it nope the banks do not do it the payroll companies yeah a few of them are doing it as a payroll company your accountant no your accountant’s never done this before unless you have an account that entered into this company and bottom line my company Kevin has actually been in business since 2009 and we have actually been dealing with the federal government and the state federal government to recuperate money for Fortune 500 Fortune 1000 companies so a lot of our big big business customers have worked with bottom line to recuperate other federal government programs we’ve done sales tax and utilize tax joblessness tax work chance tax credits research and development tax credits unclaimed property property tax all of these other federal government programs.
The worker retention tax credit is a broad based refundable tax credit created to motivate.
employers to keep employees on their payroll. The credit is 50% of approximately $10,000 in earnings paid by an.
Because of COVID-19 or whose gross invoices, employer whose business is completely or partly suspended.
decline by more than 50%.
1. The credit is offered to all companies despite size consisting of tax exempt organizations. There are.
only 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 satisfy one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the company’s business is totally 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 equivalent quarter in 2019. Once the.
company’s gross receipts exceed 80% of an equivalent quarter in 2019 they no longer qualify.
after completion of that quarter.
Computation of the Credit.
The quantity of the credit is 50% of the certifying salaries paid up to $10,000 in overall.
It works for salaries paid after March 13th and prior to December 31, 2020.
The definition of qualifying salaries differs by whether a company had, typically, more or less than.
100 employees in 2019.
Companies that concentrate on ERC filing help typically offer know-how and support to assist organizations navigate the intricate process of claiming the credit. They can provide numerous services, including:.
How is the employee retention credit calculated? How Do You File For The Employee Retention Credit
Eligibility Evaluation: These business will examine your business’s eligibility for the ERC based on factors such as your market, revenue, and operations. They can help figure out if you meet the requirements for the credit and recognize the optimum credit amount you can declare.
Documentation and Calculation: ERC filing services will help in collecting the required documents, such as payroll records and monetary declarations, to support your claim. They will also assist compute the credit amount based upon eligible salaries and other certifying costs.
Retroactive Claim Evaluation: If you are eligible 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 help you modify prior tax returns to claim these refunds.
Filing Assistance: Companies focusing on ERC filings will prepare and submit the required types and documentation in your place. This includes finishing Type 941 or any other necessary tax forms.
Compliance and Updates: ERC policies and assistance have actually progressed over time. These companies stay updated with the latest modifications and make sure that your filings adhere to the most present guidelines. If the Internal revenue service requests additional information or performs an audit associated to your ERC claim, they can likewise provide continuous support.
It’s important to research study and veterinarian any business offering ERC filing assistance to guarantee their trustworthiness and proficiency. Try to find established firms with experience in tax and payroll services, or consider connecting to relied on accounting companies or tax specialists who use ERC submitting assistance.
Bear in mind that while these companies can offer valuable help, it’s always a good concept to have a standard understanding of the ERC requirements and process yourself. This will assist you make notified choices and ensure precise filings.
The Employee Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief procedures. The goal of the ERC is to encourage services to keep and pay their staff members during the pandemic, even if their operations have actually been affected.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is available to qualified employers, including for-profit organizations, tax-exempt organizations, and specific governmental entities. To certify, employers need to satisfy one of two requirements:.
Business operations were totally or partly suspended due to a government order related to COVID-19.
The business experienced a substantial decrease in gross receipts. As mentioned previously, for 2021, a considerable decline is defined as a 20% decrease in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a significant decrease is defined as a 20% decline in gross receipts compared to the exact same quarter in 2019, or a 20% decline in gross receipts compared to the immediately preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit amount is equal to a portion (as much as 70%) of qualified salaries paid to workers, consisting of particular 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: Initially, services that received a Paycheck Defense Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 permits organizations to claim the ERC even if they got a PPP loan. The exact same salaries can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively broadened and boosted, permitting eligible employers to declare the credit for certified wages paid as far back as March 13, 2020. This retroactive arrangement supplies a chance for organizations to change prior-year income tax return and get refunds.
Declaring the Credit: Companies can claim the ERC by reporting it on their employment income tax return, usually Type 941. The excess can be refunded to the employer if the credit goes beyond the quantity of employment taxes owed.
It is necessary to note that the ERC arrangements and eligibility requirements have actually developed gradually. The best course of action is to seek advice from a tax expert or check out the main internal revenue service site for the most detailed and updated information regarding the ERC, consisting of any current legislative modifications or updates.
To receive the ERC, a company needs to fulfill one of the following requirements:.
Business operations were totally or partly suspended due to a federal government order related to COVID-19.
Business experienced a considerable decrease in gross invoices. For 2021, a significant decrease is defined as a 20% decline in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a significant decrease is defined as a 20% decrease in gross receipts compared to the very 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 organizations, however there are some exceptions. Government entities and services that received a PPP loan might have restrictions on declaring the credit.
The procedure for claiming the ERC involves finishing the needed kinds and including the credit on your employment income tax return (usually Form 941). The exact time it requires to process the credit can differ based on several elements, consisting of the intricacy of your organization and the workload of the internal revenue service. It’s advised to talk to a tax professional for guidance specific to your circumstance.
There are a number of companies that can aid with the procedure of claiming the ERC. These include accounting firms, tax advisory services, and payroll service providers. Some widely known companies that use support with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s recommended to research and get in touch with these business straight to ask about their fees and services.
Please keep in mind that the details offered here is based on basic understanding and might not reflect the most current updates or modifications to the ERC. It is necessary to talk to a tax professional or visit the official IRS site for the most current and precise information concerning eligibility, claiming procedures, and readily available assistance.
Less than 100. The credit is based if the employer had 100 or less workers on average in 2019.
on earnings paid to all employees whether they actually worked or not. Simply put, even if the.
workers worked full time and earned money for full time work, the company still gets the credit.
Greater than 100. The credit is if the company had more than 100 staff members on average in 2019.
allowed just for incomes paid to employees who did not work during the calendar quarter.
In both cases, “wages” consists of not simply money payments however also a part of the cost of company.
offered health care. How Do You File For The Employee Retention Credit
Companies can be instantly reimbursed for the credit by lowering the amount of payroll taxes they.