Lets talk first about How To Figure The Employee Retention Credit :
Our team here what do these men doing everyone in this room is assisting teach individuals about ERC and uh constantly provide a stunning breakfast and have individuals actually learn about the program we must head to the room where we are able to display a few of the checks that we are getting for business and I ‘d like to see that what is this this is uh hundreds of countless dollars actually 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 indicate you know if you just begin to look at some of these here I mean this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I mean it’s just I mean think about the number of actual 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 customer so that’s how you have the ability to track it you understand when you
get this you understand the check is opted for sure and that’s when they pay so they do not pay anything till they actually get the money 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 savings account and they can truly trust Wonder trust that the process has been ended up and how many you believe you have actually processed considering that you started this we’re about 35 000 of these for
about six billion dollars wow so plainly they know what they’re doing which’s what you need you need experts 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 Wonderful here you’re at my YouTube channel we’re talking about something truly crucial today the worker retention credit which the majority of you have never ever become aware of I certainly had not heard of it till extremely recently and learned a lot about it because 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’ve got the specialist 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 not easy this isn’t like PPP we just contact your bank supervisor and say offer 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 have actually ended up being yes the Ambassador and paid representative for this I enjoy this program it’s disappearing very soon you got to discover all about it let’s talk worker 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 offered companies three chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and almost everyone it makes a huge distinction right there two of them are loans and one’s a refund exactly so the ERC is a refund that’s.
correct the money cash payroll tax refund okay go on sorry I just have to ensure we got that point I indicate that’s a huge distinction a loan versus money money I like money cash that’s what we’re speaking about 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 beautiful tough check in the mail where you get real money from the internal revenue service all right so let’s discuss how it works since it seems like to me if it’s a if it’s employee retention credit that individual needed to be a staff member so I’m going to make the Assumption this money is not for the owner not for individuals on the cap table not for shareholders it’s for workers right you had to have owned a business 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 qualified so you have to be on payroll in 2020 on the W-2 and you have to be on payroll for the very first 6 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 4 of 2020 and you had quarters one 2 and three of 2021. fine 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 cash how much can you return 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 income to a maximum of 5 thousand dollars per worker for the year of 2020 and in 2021 the numbers escalated to 70 of the staff member’s salary to an optimum of 7 thousand per quarter how did that happen um they simply altered the rules in.
2021 versus because the turmoil 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 five thousand Max and after that what occurs 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 worker that is since that’s a lot of cash it is now there’s a caveat here the PPP money would need to be decreased from the twenty six thousand dollars so if you took PPP loan one and PPP loan two you would minimize the 26 000 so what we’re seeing typically Kevin is if you took PPP money someplace around 10 thousand dollars a person so let’s say hypothetically you owned a dining establishment in New York 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 huge undoubtedly now the huge question is why does no one learn about this due to the fact that look when I initially became aware of this when I initially satisfied Josh you understand I have actually got great deals of investments in great deals of companies I’m a significant supporter for entrepreneurship in America and make lots of lots of financial investments in entrepreneurs of which lots of suffered through the pandemic when I first heard about this I called BS I do not believe it due to the fact that 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 which were well should have and we used them carefully to stay alive during the pandemic so when I heard about this I said nah it can’t hold true but when I dug around I even called to my political leader friends Governor Senators they didn’t understand about it I imply that’s how you know that’s how false information is that there’s no info out there then a bunch of people informed me well you can’t get it since you took the PPP likewise not real so let’s ask Josh why does no one understand about the employee retention credit you understand what’s intriguing you’re talking 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 process process that’s all um and here there was turmoil because remember in the original cares act you could not do both programs so if you had actually 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 since it’s not alone so you’re getting a tax refund so the government never made it clear to anybody about how to.
do this does your CFO know how to do this not truly she or he’s never ever done it before do the banks do it nope the banks do not do it the payroll business yeah some of them are doing it as a payroll company your accounting professional no your accountant’s never ever done this before unless you have an account that entered into this business and bottom line my firm Kevin has stayed in business because 2009 and we’ve been dealing with the federal government and the state government to recuperate cash for Fortune 500 Fortune 1000 business so a great deal of our big huge business clients have actually dealt with bottom line to recuperate other government programs we’ve done sales tax and utilize tax joblessness tax work opportunity tax credits research and development tax credits unclaimed property real estate tax all of these other government programs.
The employee retention tax credit is a broad based refundable tax credit designed to motivate.
companies to keep workers on their payroll. The credit is 50% of as much as $10,000 in earnings paid by an.
Because of COVID-19 or whose gross invoices, company whose business is fully or partially suspended.
decrease by more than 50%.
1. The credit is offered to all employers despite size including tax exempt organizations. There are.
only 2 exceptions: (1) state and city governments and their instrumentalities and (2) small.
businesses who take Small company Loans.
2. To qualify, the company has to satisfy one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the employer’s company is completely or partially suspended by federal government order due to COVID-19.
during the calendar quarter or.
o the employer’s gross invoices are listed below 50% of the similar quarter in 2019. When the.
company’s gross receipts exceed 80% of a comparable quarter in 2019 they no longer qualify.
after the end of that quarter.
Estimation of the Credit.
The amount of the credit is 50% of the certifying incomes paid up to $10,000 in overall.
It works for earnings paid after March 13th and before December 31, 2020.
The meaning of qualifying earnings differs by whether a company had, typically, basically than.
100 workers in 2019.
Business that concentrate on ERC filing support generally provide proficiency and support to assist organizations navigate the complicated process of claiming the credit. They can offer numerous services, including:.
How is the employee retention credit calculated? How To Figure The Employee Retention Credit
Eligibility Assessment: These business will examine your business’s eligibility for the ERC based on factors such as your industry, profits, and operations. If you satisfy the requirements for the credit and identify the maximum credit quantity you can declare, they can assist figure out.
Documentation and Estimation: ERC filing services will assist in collecting the essential documentation, such as payroll records and monetary statements, to support your claim. They will likewise assist compute the credit quantity based on qualified salaries and other certifying costs.
Retroactive Claim Evaluation: If you are eligible to claim the ERC for prior quarters, these business can review your past payroll records and financials to recognize prospective chances for retroactive credits. They can help you modify previous income tax return to declare these refunds.
Filing Help: Business specializing in ERC filings will prepare and submit the needed forms and documentation on your behalf. This consists of finishing Kind 941 or any other required tax return.
Compliance and Updates: ERC guidelines and assistance have progressed with time. These business stay upgraded with the current modifications and ensure that your filings adhere to the most existing guidelines. They can likewise supply ongoing support if the internal revenue service requests extra info or conducts an audit related to your ERC claim.
It is very important to research and veterinarian any business offering ERC filing support to guarantee their reliability and expertise. Try to find recognized firms with experience in tax and payroll services, or consider reaching out to relied on accounting companies or tax specialists who offer ERC submitting assistance.
Remember that while these companies can supply valuable support, it’s always a good concept to have a standard understanding of the ERC requirements and process yourself. This will help you make notified choices and guarantee accurate filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit introduced by the U.S. federal government as part of COVID-19 relief measures. The objective of the ERC is to motivate services to maintain and pay their employees throughout the pandemic, even if their operations have been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is offered to eligible companies, including for-profit businesses, tax-exempt organizations, and particular governmental entities. To certify, employers must meet one of two criteria:.
Business operations were completely or partially suspended due to a government order related to COVID-19.
Business experienced a considerable decline in gross receipts. As discussed earlier, for 2021, a considerable decrease is defined as a 20% decline in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a substantial decrease is specified as a 20% decline in gross invoices compared to the very same quarter in 2019, or a 20% decrease 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 amounts to a portion (approximately 70%) of certified salaries paid to workers, consisting of certain health plan costs. The optimum credit per employee is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: At first, organizations that got an Income Protection Program (PPP) loan were not eligible for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 enables businesses to claim the ERC even if they received a PPP loan. The very same incomes can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively broadened and improved, enabling eligible companies to claim the credit for certified wages paid as far back as March 13, 2020. This retroactive arrangement supplies a chance for organizations to modify prior-year tax returns and receive refunds.
Declaring the Credit: Employers can declare the ERC by reporting it on their employment income tax return, usually Form 941. The excess can be reimbursed to the company if the credit goes beyond the amount of work taxes owed.
It’s important to note that the ERC provisions and eligibility requirements have evolved with time. The very best course of action is to consult with a tax professional or go to the main IRS website for the most comprehensive and updated info regarding the ERC, consisting of any current legal modifications or updates.
To get approved for the ERC, a service should meet among the following criteria:.
Business operations were fully or partly suspended due to a government order related to COVID-19.
The business experienced a significant decrease in gross invoices. For 2021, a substantial decrease is specified as a 20% decrease in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a substantial decrease is defined as a 20% decline in gross receipts compared to the very same quarter in 2019, or a 20% decline in gross receipts compared to the instantly preceding quarter.
The ERC is offered to businesses of all sizes, consisting of tax-exempt companies, but there are some exceptions. For instance, government entities and services that got a PPP loan might have restrictions on claiming the credit.
The procedure for declaring the ERC includes completing the required types and including the credit on your employment income tax return (typically Form 941). The exact time it requires to process the credit can differ based upon several elements, including the complexity of your service and the work of the internal revenue service. It’s advised to talk to a tax expert for assistance specific to your situation.
There are a number of companies that can aid with the procedure of claiming the ERC. These include accounting companies, tax advisory services, and payroll provider. Some well-known business that provide help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s advisable to research and get in touch with these companies directly to ask about their services and charges.
Please note that the details supplied here is based upon basic knowledge and might not reflect the most recent updates or modifications to the ERC. It is essential to seek advice from a tax professional or go to the main IRS site for the most accurate and current information regarding eligibility, declaring treatments, and offered help.
Less than 100. If the company had 100 or less employees on average in 2019, then the credit is based.
on earnings paid to all workers whether they actually worked or not. To put it simply, even if the.
workers worked full-time and made money for full-time work, the company still gets the credit.
Greater than 100. If the employer had more than 100 workers typically in 2019, then the credit is.
enabled only for incomes paid to workers who did not work throughout the calendar quarter.
In both cases, “incomes” consists of not just money payments however also a portion of the expense of employer.
provided health care. How To Figure The Employee Retention Credit
Employers can be instantly repaid for the credit by decreasing the amount of payroll taxes they.