Lets talk first about How To Receive The Employee Retention Credit :
Our group here what do these people doing everyone in this space is helping teach people about ERC and uh always provide a lovely breakfast and have individuals truly learn about the program we should 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 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 imply you know if you just start to take a look at some of these here I imply this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I suggest it’s simply I indicate think about 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 IRS heading to the client so that’s how you have the ability to track it you know when you
receive this you know the check is gone for sure and that’s when they pay so they do not pay anything up until they in fact receive the cash they do not pay bottom line Wonder trust anything till this letter is confirmed the check is on the method they deposit it into their checking account and they can genuinely trust Wonder trust that the process has actually been completed and how many you think you have actually processed considering that you started this we have to do with 35 000 of these for
about six billion dollars wow so clearly they understand what they’re doing which’s what you require 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 Terrific here you’re at my YouTube channel we’re discussing something actually crucial today the employee retention credit which most of you have never become aware of I definitely hadn’t heard of it till really just recently and discovered a lot about it because this is probably the lowest expense of capital for any small company anywhere
anytime if you have staff members in between five and five hundred so I have actually got the specialist with me this is Josh Fox he’s the creator 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 call 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 have actually become yes the Ambassador and paid spokesperson for this I enjoy this program it’s disappearing very soon you got to find out all about it let’s talk employee retention credit Josh Fox what is an ERC let’s just start there so throughout the Trump Administration when President Trump was enacted they developed the cares Act and the cares act used companies 3 opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically everybody it makes a big distinction right there 2 of them are loans and one’s a refund exactly so the ERC is a refund that’s.
correct the money money payroll tax refund fine go on sorry I just need to make certain we got that point I mean that’s a big distinction a loan versus money cash I like money cash that’s what we’re speaking 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 lovely difficult check in the mail where you get actual cash from the IRS all right so let’s talk about 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 worker so I’m going to make the Assumption this money is not for the owner not for individuals on the cap table not for investors it’s for employees right you needed 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 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 proper so there were six quarters the program was open well walk us through the 6 quarters so you had quarters two 3 and four of 2020 and you had quarters one 2 and 3 of 2021. all right so that’s how it’s determined you have to be on the W-2 during that period now let’s talk my favorite part money how much can you get back per employee that was on a W-2 in those six quarters so the calculation in 2020 to be exact Kevin is 50 of the worker’s wage to an optimum of five thousand dollars per employee for the year of 2020 and in 2021 the numbers escalated to 70 of the staff member’s salary to a maximum of seven thousand per quarter how did that occur um they just changed the rules in.
2021 versus because the mayhem of the pandemic so they wished 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 5 thousand Max and after that what occurs 21 000 Max in 2021 oh that’s how you create twenty 6 thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty 6 thousand dollars per staff member that is because that’s a great deal of money it is now there’s a caution here the PPP money would have to be minimized 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 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 workers and you took PPP money you would still get a million dollar in the mail from the internal revenue service so it’s big certainly now the big question is why does nobody know about this because appearance when I first became aware of this when I initially fulfilled Josh you know I’ve got great deals of investments in lots of business I’m a significant supporter for entrepreneurship in America and make lots of many financial investments in business owners of which many suffered through the pandemic when I initially became aware of this I called BS I don’t believe it due to the fact that I use the PPP we went through the cash 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 utilized them carefully to stay alive 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 called to my political leader pals Governor Senators they didn’t know about it I suggest that’s how you understand that’s how misinformation is that there’s no info out there then a bunch of people 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 nobody learn about the staff member retention credit you know what’s interesting you’re discussing the banks Kevin because 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 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 process process that’s all um and here there was chaos due to the fact that keep in mind in the original cares act you might not do both programs so if you had actually done PPP you might refrain from doing ERC in the initial program and when they changed the law in 2021 the banks were refraining from doing ERC because it’s not alone so you’re getting a tax refund so the government never ever made it clear to anybody about how to.
do this does your CFO know how to do this not truly he or she’s never done it in the past do the banks do it nope the banks do not do it the payroll business yeah a few of them are doing it as a payroll company your accountant no your accounting professional’s never ever done this before unless you have an account that went into this company and bottom line my firm Kevin has actually been in business given that 2009 and we’ve been dealing with the federal government and the state federal government to recover money for Fortune 500 Fortune 1000 business so a lot of our huge big corporate customers have actually worked with bottom line to recover other government programs we’ve done sales tax and use tax joblessness tax work opportunity 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 encourage.
companies to keep employees on their payroll. The credit is 50% of up to $10,000 in earnings paid by an.
company whose organization is completely or partially suspended because of COVID-19 or whose gross receipts.
decrease by more than 50%.
Accessibility.
1. The credit is available to all companies no matter size including tax exempt companies. There are.
only two exceptions: (1) state and local governments and their instrumentalities and (2) small.
services who take Small Business Loans.
2. To certify, the employer needs to fulfill one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the company’s business is fully or partly suspended by government order due to COVID-19.
during the calendar quarter or.
o the employer’s gross invoices are listed below 50% of the comparable quarter in 2019. As soon as the.
employer’s gross invoices go above 80% of a similar quarter in 2019 they no longer qualify.
after completion of that quarter.
Calculation of the Credit.
The quantity of the credit is 50% of the qualifying 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 wages differs by whether an employer had, on average, more or less than.
100 workers in 2019.
Companies that concentrate on ERC filing support usually offer expertise and assistance to help businesses navigate the complex procedure of claiming the credit. They can provide various services, including:.
How is the employee retention credit calculated? How To Receive The Employee Retention Credit
Eligibility Assessment: These business will assess your company’s eligibility for the ERC based upon factors such as your market, earnings, and operations. If you satisfy the requirements for the credit and identify the maximum credit amount you can declare, they can help figure out.
Documents and Computation: ERC filing services will assist in collecting the required documents, such as payroll records and monetary declarations, to support your claim. They will likewise assist determine the credit quantity based upon eligible wages and other qualifying expenditures.
Retroactive Claim Review: If you are qualified to declare the ERC for prior quarters, these companies can examine your previous payroll records and financials to identify potential chances for retroactive credits. They can assist you modify prior tax returns to declare these refunds.
Filing Assistance: Business focusing on ERC filings will prepare and submit the required types and documents in your place. This includes finishing Kind 941 or any other required tax return.
Compliance and Updates: ERC regulations and guidance have progressed over time. These companies stay upgraded with the current modifications and make sure that your filings abide by the most current standards. They can likewise provide continuous support if the IRS requests extra info or conducts an audit related to your ERC claim.
It is essential to research and vet any company providing ERC filing help to guarantee their credibility and knowledge. Search for established companies with experience in tax and payroll services, or think about connecting to relied on accounting companies or tax professionals who use ERC filing support.
Remember that while these companies can offer important support, it’s always an excellent idea to have a fundamental understanding of the ERC requirements and procedure yourself. This will help you make informed decisions and guarantee accurate filings.
The Employee 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 organizations to maintain and pay their employees throughout the pandemic, even if their operations have been affected.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is readily available to eligible companies, including for-profit companies, tax-exempt organizations, and certain governmental entities. To qualify, companies should meet one of two requirements:.
Business operations were totally or partly suspended due to a federal government order related to COVID-19.
The business experienced a substantial decrease in gross receipts. As mentioned previously, for 2021, a substantial decline is specified as a 20% decline 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 invoices compared to the exact same quarter in 2019, or a 20% decrease in gross receipts compared to the right away 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 percentage (as much as 70%) of qualified incomes paid to staff members, including specific 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 Defense Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 allows services to claim the ERC even if they got a PPP loan. The same incomes can not be utilized to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively broadened and enhanced, permitting eligible employers to claim the credit for certified wages paid as far back as March 13, 2020. This retroactive provision supplies an opportunity for companies to amend prior-year income tax return and get refunds.
Declaring the Credit: Companies can declare the ERC by reporting it on their work tax returns, generally Kind 941. The excess can be refunded to the company if the credit exceeds the quantity of work taxes owed.
It is essential to keep in mind that the ERC arrangements and eligibility criteria have progressed gradually. The best strategy is to speak with a tax professional or check out the official internal revenue service site for the most comprehensive and updated details regarding the ERC, consisting of any current legal changes or updates.
To get approved for the ERC, a business needs to satisfy one of the following criteria:.
Business operations were fully or partly suspended due to a government order related to COVID-19.
The business experienced a significant decline in gross invoices. For 2021, a substantial decrease is defined as a 20% decline in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a considerable decline is defined as a 20% decrease in gross invoices 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 offered to organizations of all sizes, consisting of tax-exempt companies, but there are some exceptions. For instance, federal government entities and businesses that got a PPP loan might have restrictions on claiming the credit.
The process for declaring the ERC involves completing the essential forms and consisting of the credit on your work tax return (usually Type 941). The exact time it takes to process the credit can differ based upon numerous factors, consisting of the complexity of your business and the work of the internal revenue service. It’s advised to consult with a tax professional for assistance particular to your circumstance.
There are numerous companies that can assist with the process of declaring the ERC. Some widely known business that provide help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the details supplied here is based on general knowledge and may not reflect the most current updates or modifications to the ERC. It is very important to seek advice from a tax expert or visit the main internal revenue service website for the most accurate and updated details regarding eligibility, claiming procedures, and available help.
Less than 100. If the company had 100 or less workers usually in 2019, then the credit is based.
on salaries paid to all employees whether they in fact 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 company had more than 100 workers on average in 2019.
permitted just for incomes paid to workers who did not work during the calendar quarter.
In both cases, “incomes” includes not just money payments but likewise a part of the cost of company.
offered healthcare. How To Receive The Employee Retention Credit
Payment.
Companies can be right away reimbursed for the credit by lowering the quantity of payroll taxes they.