Lets talk first about How To Use The Employee Retention Credit :
Our team here what do these guys doing everyone in this room is assisting teach individuals about ERC and uh constantly supply a beautiful breakfast and have people truly learn more about the program we ought to head to the space where we have the ability to display a few of the checks that we are getting for business and I wish to see that what is this this is uh numerous millions of dollars actually Kevin hundreds of millions of dollars so these are duplicate copies of the letters that go to customers validating that the check is on the way I imply you understand if you simply begin to take a look at a few of these here I suggest this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I mean it’s simply I mean 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 confirmed and the check is on the mail in the mail from the internal revenue service heading to the client so that’s how you’re able to track it you understand when you
receive this you understand the check is gone 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 up until this letter is verified the check is on the method they transfer it into their bank account and they can truly rely on Wonder trust that the procedure has actually been completed and how many you think you’ve processed given that you began this we’re about 35 000 of these for
about six billion dollars wow so plainly they understand what they’re doing and that’s what you need you require 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 speaking about something really crucial today the worker retention credit which the majority of you have actually never ever become aware of I definitely had not heard of it till really just recently and learned a lot about it due to the fact that this is most likely the lowest cost of capital for any small company anywhere
anytime if you have workers between 5 and five hundred so I have actually got the expert with me this is Josh Fox he’s the founder and CEO of bottom line Principles they’re the biggest processor of these ERC credits this is a 170 page program so it’s not easy this isn’t like PPP we just phone 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 us all about it and how to get it and why I’ve ended up being yes the Ambassador and paid spokesperson for this I enjoy this program it’s going away soon you got to find out 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 businesses three opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly 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.
correct the money money payroll tax refund okay go on sorry I just have to make sure we got that point I suggest that’s a big difference a loan versus cash money I like money 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 beautiful tough check in the mail where you get real money from the internal revenue service all right so let’s talk about how it works because it sounds 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 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 owned a service but it’s based on you having W-2 workers in America not 10.99. so as long as you had W-2 staff members and you paid federal payroll taxes that’s why you would be eligible so you need 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 correct so there were six quarters the program was open well walk us through the six quarters so you had quarters two three and four of 2020 and you had quarters one 2 and three of 2021. okay so that’s how it’s measured you need to be on the W-2 throughout that duration now let’s talk my preferred part money just how much can you return per worker that was on a W-2 in those 6 quarters so the estimation in 2020 to be exact Kevin is 50 of the worker’s income to an optimum of 5 thousand dollars per employee for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the worker’s wage to an optimum of 7 thousand per quarter how did that occur um they simply changed the rules in.
2021 versus because the chaos 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 as much as 5 thousand Max and then what takes place 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 6 thousand dollars per staff member that is since that’s a lot of cash it is now there’s a caution here the PPP cash would have to be minimized from the twenty six thousand dollars so if you took PPP loan one and PPP loan 2 you would lower the 26 000 so what we’re seeing on average Kevin is if you took PPP money somewhere around 10 thousand dollars a person so let’s state hypothetically you owned a restaurant in New york city 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 IRS so it’s big certainly now the big concern is why does nobody understand about this because appearance when I first found out about this when I first satisfied Josh you understand I have actually got great deals of financial investments in great deals of business I’m a significant supporter for entrepreneurship in America and make lots of numerous investments in entrepreneurs of which many suffered through the pandemic when I first found out about this I called BS I don’t think it due to the fact that I utilize 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 and that were well should have and we utilized them wisely to survive during the pandemic so when I heard about this I stated nah it can’t be true however when I dug around I even contacted us to my political leader friends Guv Senators they didn’t understand about it I imply that’s how you know that’s how false information is that there’s no information out there then a lot of individuals told me well you can’t get it because you took the PPP likewise not true so let’s ask Josh why does no one know about the employee retention credit you understand what’s fascinating you’re talking about the banks Kevin since in the PPP loan process the federal government made it really 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 process that’s all um and here there was turmoil due to the fact that remember in the initial cares act you could refrain from doing 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 not 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 know how to do this not really she or he’s never done it before 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 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 actually been in business given that 2009 and we have actually been working with the federal government and the state government to recuperate cash for Fortune 500 Fortune 1000 companies so a lot of our big huge business clients have dealt with bottom line to recuperate other federal government programs we’ve done sales tax and use 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 developed to motivate.
companies to keep employees on their payroll. The credit is 50% of up to $10,000 in wages paid by an.
employer whose business is fully or partially suspended because of COVID-19 or whose gross invoices.
decline by more than 50%.
1. The credit is available to all employers regardless of size consisting of tax exempt organizations. There are.
just 2 exceptions: (1) state and local governments and their instrumentalities and (2) small.
companies who take Small company Loans.
2. To qualify, the company has to meet one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the company’s business is completely or partially suspended by government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross receipts are listed below 50% of the equivalent quarter in 2019. As soon as the.
company’s gross receipts go above 80% of a similar quarter in 2019 they no longer certify.
after completion of that quarter.
Estimation of the Credit.
The amount 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 before December 31, 2020.
The meaning of qualifying wages differs by whether an employer had, on average, more or less than.
100 workers in 2019.
Companies that focus on ERC filing assistance generally provide knowledge and assistance to assist businesses browse the complex process of claiming the credit. They can use numerous services, consisting of:.
How is the employee retention credit calculated? How To Use The Employee Retention Credit
Eligibility Assessment: These business will assess your company’s eligibility for the ERC based on elements such as your industry, profits, and operations. If you fulfill the requirements for the credit and recognize the maximum credit amount you can declare, they can assist figure out.
Documentation and Calculation: ERC filing services will assist in collecting the essential documentation, such as payroll records and monetary declarations, to support your claim. They will also help calculate the credit quantity based upon qualified salaries and other certifying expenditures.
Retroactive Claim Review: If you are eligible to claim the ERC for previous quarters, these companies can examine your previous payroll records and financials to determine potential opportunities for retroactive credits. They can help you change previous income tax return to declare these refunds.
Filing Assistance: Business concentrating on ERC filings will prepare and submit the needed types and paperwork on your behalf. This includes finishing Form 941 or any other required tax forms.
Compliance and Updates: ERC guidelines and assistance have evolved over time. These business remain upgraded with the latest changes and guarantee that your filings adhere to the most existing guidelines. If the IRS demands additional details or performs an audit associated to your ERC claim, they can also provide ongoing support.
It’s important to research and vet any business providing ERC filing help to guarantee their reliability and know-how. Search for established companies with experience in tax and payroll services, or think about reaching out to relied on accounting companies or tax professionals who offer ERC filing assistance.
Keep in mind that while these business can supply valuable assistance, it’s constantly a good concept to have a fundamental understanding of the ERC requirements and procedure yourself. This will assist you make notified choices and make sure accurate filings.
The Employee Retention Credit (ERC) is a refundable tax credit presented by the U.S. government as part of COVID-19 relief steps. The goal of the ERC is to motivate companies to retain and pay their employees during the pandemic, even if their operations have been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is available to eligible employers, consisting of for-profit businesses, tax-exempt companies, and particular governmental entities. To certify, companies should fulfill one of two requirements:.
Business operations were completely or partly suspended due to a government order related to COVID-19.
The business experienced a significant decrease in gross receipts. As mentioned earlier, for 2021, a considerable decrease is defined as a 20% decrease in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a considerable decline 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 employer’s share of Social Security taxes. The credit quantity amounts to a percentage (as much as 70%) of qualified earnings paid to workers, including certain health insurance costs. 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, services that received an Income Defense Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 enables organizations to claim the ERC even if they received a PPP loan. The exact same salaries can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has actually been retroactively broadened and improved, allowing eligible companies to claim the credit for certified wages paid as far back as March 13, 2020. This retroactive arrangement supplies a chance for businesses to modify prior-year tax returns and get refunds.
Claiming the Credit: Companies can claim the ERC by reporting it on their employment income tax return, typically Form 941. If the credit exceeds the quantity of employment taxes owed, the excess can be reimbursed to the company.
It is essential to keep in mind that the ERC provisions and eligibility criteria have progressed with time. The very best course of action is to speak with a tax expert or go to the official IRS website for the most detailed and current information relating to the ERC, including any recent legislative modifications or updates.
To get approved for the ERC, a service needs to satisfy one of the following requirements:.
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 specified as a 20% decrease in gross receipts 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 exact same quarter in 2019, or a 20% decline in gross invoices compared to the right away preceding quarter.
The ERC is available to organizations of all sizes, consisting of tax-exempt companies, however there are some exceptions. For example, government entities and companies that got a PPP loan might have limitations on declaring the credit.
The process for declaring the ERC includes finishing the needed forms and including the credit on your work income tax return (normally Form 941). The exact time it takes to process the credit can vary based upon numerous aspects, consisting of the complexity of your service and the work of the internal revenue service. It’s recommended to speak with a tax expert for assistance specific to your situation.
There are numerous business that can help with the procedure of declaring the ERC. Some widely known companies that use assistance with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the details provided here is based on general knowledge and might not show the most recent updates or modifications to the ERC. It is very important to seek advice from a tax professional or visit the official IRS site for the most updated and precise information concerning eligibility, claiming procedures, and readily available help.
Less than 100. The credit is based if the company had 100 or less employees on average in 2019.
on wages paid to all employees whether they really worked or not. In other words, even if the.
staff members worked full-time and earned 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 earnings paid to workers who did not work during the calendar quarter.
In both cases, “incomes” consists of not just money payments however also a part of the expense of employer.
supplied health care. How To Use The Employee Retention Credit
Companies can be right away compensated for the credit by reducing the amount of payroll taxes they.