Lets talk first about Irc Section 280C Employee Retention Credit :
Our group here what do these guys doing everyone in this room is helping teach individuals about ERC and uh constantly provide a gorgeous breakfast and have individuals actually discover the program we must head to the space where we have the ability to show some of the checks that we are getting for companies and I want to see that what is this this is uh hundreds of countless dollars actually Kevin numerous countless dollars so these are replicate copies of the letters that go to customers verifying that the check is on the method I suggest you know if you simply start to 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 imply it’s simply I imply think about the number of real 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 internal revenue service heading to the client so that’s how you have the ability to track it you know when you
receive this you understand the check is gone for sure and that’s when they pay so they do not pay anything until they really get the cash they do not 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 really rely on Wonder trust that the process has actually been completed and the number of you believe you’ve processed since you began this we have to do with 35 000 of these for
about six billion dollars wow so plainly 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 one of these that’s what matters all right Mr Fantastic here you’re at my YouTube channel we’re discussing something actually important today the staff member retention credit which the majority of you have never heard of I definitely hadn’t heard of it until really just recently and discovered a lot about it due to the fact that this is probably the most affordable 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 professional with me this is Josh Fox he’s the creator and CEO of bottom line Concepts they’re the biggest processor of these ERC credits this is a 170 page program so it’s challenging this isn’t like PPP we simply phone your bank supervisor and say give 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 ended up being yes the Ambassador and paid representative for this I love this program it’s going away soon you got to learn everything about it let’s talk worker retention credit Josh Fox what is an ERC let’s just begin there so during the Trump Administration when President Trump was enacted they created the cares Act and the cares act provided services 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 precisely so the ERC is a refund that’s.
remedy the money money payroll tax refund alright go on sorry I simply need to ensure we got that point I imply that’s a huge difference 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 original cares Act is the ERC and yes Kevin it is a lovely difficult check in the mail where you get actual money from the internal revenue service all right so let’s talk about how it works due to the fact that it seems like to me if it’s a if it’s worker retention credit that individual had 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 workers right you needed to have owned a service however it’s based on you having W-2 staff members 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 eligible so you have to be on payroll in 2020 on the W-2 and you need to be on payroll for the very first 6 months of 2021 on the W-2 proper so there were six quarters the program was open well walk us through the six quarters so you had quarters 2 3 and 4 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 duration now let’s talk my preferred part money how much can you get back per employee that was on a W-2 in those 6 quarters so the computation in 2020 to be exact Kevin is 50 of the staff member’s wage to a maximum of 5 thousand dollars per worker 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 take place um they just altered the rules in.
2021 versus since the mayhem of the pandemic so they wanted 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 five thousand Max and then what happens 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 staff member that is since that’s a great deal of money it is now there’s a caveat here the PPP money would need 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 ten thousand dollars an individual so let’s state 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 IRS so it’s substantial clearly now the big concern is why does no one understand about this due to the fact that look when I first became aware of this when I initially fulfilled Josh you know I have actually got great deals of investments in lots of companies I’m a significant advocate for entrepreneurship in America and make lots of numerous financial investments in business owners of which lots of suffered through the pandemic when I first heard about this I called BS I don’t think it due to the fact that I utilize 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 been worthy of and we used them wisely to survive 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 politician good friends Governor Senators they didn’t know about it I mean that’s how you know that’s how false information is that there’s no information out there then a bunch 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 learn about the staff member retention credit you understand what’s interesting you’re talking about the banks Kevin since in the PPP loan procedure 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 big 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 just procedure procedure that’s all um and here there was chaos due to the fact that keep in mind 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 because it’s not alone so you’re getting a tax refund so the federal government never made it clear to anybody about how to.
do this does your CFO understand how to do this not really he or she’s never done it in the past 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 accounting professional’s never done this prior to unless you have an account that entered into this service and bottom line my firm Kevin has actually been in business since 2009 and we’ve been working with the federal government and the state government to recuperate money for Fortune 500 Fortune 1000 business so a great deal of our big huge business customers have worked with bottom line to recuperate other government programs we have actually done sales tax and use tax joblessness tax work opportunity tax credits research and development tax credits unclaimed home property tax all of these other federal 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 as much as $10,000 in wages paid by an.
company whose service is totally or partly suspended because of COVID-19 or whose gross invoices.
decline by more than 50%.
Schedule.
1. The credit is readily available to all employers no matter size consisting of tax exempt organizations. There are.
only 2 exceptions: (1) state and local governments and their instrumentalities and (2) small.
companies who take Small Business Loans.
2. To certify, the company needs to fulfill one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the employer’s business is completely 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 similar quarter in 2019. As soon as the.
employer’s gross invoices go above 80% of an equivalent quarter in 2019 they no longer certify.
after completion of that quarter.
Estimation of the Credit.
The quantity of the credit is 50% of the certifying earnings paid up to $10,000 in overall.
It works for wages paid after March 13th and before December 31, 2020.
The meaning of qualifying salaries differs by whether a company had, on average, more or less than.
100 workers in 2019.
Business that focus on ERC filing help usually supply know-how and assistance to help services navigate the complicated process of claiming the credit. They can provide various services, consisting of:.
How is the employee retention credit calculated? Irc Section 280C Employee Retention Credit
Eligibility Assessment: These business will examine your company’s eligibility for the ERC based on aspects such as your market, revenue, and operations. If you fulfill the requirements for the credit and identify the optimum credit quantity you can declare, they can assist determine.
Documentation and Estimation: ERC filing services will assist in collecting the needed paperwork, 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 qualifying costs.
Retroactive Claim Evaluation: If you are eligible to declare the ERC for prior quarters, these companies can examine your previous payroll records and financials to identify prospective opportunities for retroactive credits. They can help you change previous income tax return to claim these refunds.
Filing Help: Companies specializing in ERC filings will prepare and submit the required kinds and paperwork on your behalf. This consists of completing Kind 941 or any other necessary tax forms.
Compliance and Updates: ERC policies and guidance have developed gradually. These business remain upgraded with the most recent changes and ensure that your filings comply with the most current guidelines. They can also provide ongoing support if the IRS requests extra details or performs an audit related to your ERC claim.
It’s important to research and veterinarian any business offering ERC filing support to guarantee their reliability and proficiency. Try to find recognized firms with experience in tax and payroll services, or consider reaching out to trusted accounting companies or tax specialists who provide ERC submitting assistance.
Remember that while these business can supply valuable support, it’s always a great idea to have a fundamental understanding of the ERC requirements and process yourself. This will assist you make notified decisions and make sure precise filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit presented by the U.S. federal government as part of COVID-19 relief measures. The goal of the ERC is to motivate businesses to retain and pay their workers throughout the pandemic, even if their operations have actually been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is offered to qualified companies, including for-profit services, tax-exempt companies, and specific governmental entities. To qualify, employers need to satisfy one of two criteria:.
Business operations were fully or partly suspended due to a federal government order related to COVID-19.
The business experienced a considerable decline in gross invoices. As discussed previously, for 2021, a significant decline 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 exact same quarter in 2019, or a 20% decline in gross receipts compared to the instantly 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 portion (up to 70%) of certified incomes paid to staff members, including specific health insurance costs. The optimum credit per staff member is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, companies that received an Income Defense Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 permits services to declare the ERC even if they got a PPP loan. However, the exact same incomes can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively expanded and enhanced, enabling eligible companies to declare the credit for certified earnings paid as far back as March 13, 2020. This retroactive arrangement offers a chance for organizations to modify prior-year income tax return and get refunds.
Claiming the Credit: Companies can declare the ERC by reporting it on their work income tax return, typically Form 941. If the credit exceeds the amount of employment taxes owed, the excess can be reimbursed to the company.
It is necessary to keep in mind that the ERC provisions and eligibility requirements have evolved with time. The very best strategy is to talk to a tax professional or visit the official internal revenue service site for the most comprehensive and current info relating to the ERC, including any current legal modifications or updates.
To receive the ERC, a company needs to satisfy one of the following criteria:.
The business operations were completely or partially suspended due to a government order related to COVID-19.
The business experienced a substantial decrease in gross invoices. For 2021, a considerable decline is defined as a 20% decrease in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a substantial decrease is specified as a 20% decrease in gross receipts compared to the very same quarter in 2019, or a 20% decline in gross receipts compared to the immediately preceding quarter.
The ERC is offered to organizations of all sizes, including tax-exempt organizations, however there are some exceptions. Government entities and services that received a PPP loan might have constraints on claiming the credit.
The process for declaring the ERC involves finishing the essential kinds and consisting of the credit on your employment income tax return (typically Form 941). The exact time it requires to process the credit can vary based on a number of elements, consisting of the intricacy of your company and the work of the IRS. It’s advised to speak with a tax professional for assistance specific to your circumstance.
There are several business that can help with the process of claiming the ERC. Some popular business that offer support with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the details provided here is based on general knowledge and may not show the most current updates or changes to the ERC. It’s important to speak with a tax expert or visit the main internal revenue service site for the most accurate and current details concerning eligibility, declaring treatments, and readily available support.
Less than 100. The credit is based if the employer had 100 or less staff members on average in 2019.
on earnings paid to all workers whether they in fact worked or not. In other words, even if the.
employees worked full time and earned money for full-time work, the employer still gets the credit.
Greater than 100. The credit is if the employer had more than 100 staff members on average in 2019.
enabled just for salaries paid to workers who did not work throughout the calendar quarter.
In both cases, “salaries” consists of not just cash payments but likewise a portion of the cost of employer.
offered healthcare. Irc Section 280C Employee Retention Credit
Payment.
Companies can be immediately reimbursed for the credit by lowering the quantity of payroll taxes they.