Lets talk first about Is Employee Retention Credit A Real Thing :
Our group here what do these guys doing everybody in this space is helping teach people about ERC and uh always offer a stunning breakfast and have people actually discover the program we need to head to the space where we are able to display a few of the checks that we are getting for companies and I ‘d like to see that what is this this is uh hundreds of countless dollars literally Kevin numerous millions of dollars so these are replicate copies of the letters that go to clients validating that the check is on the way I suggest 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 mean it’s simply I mean think of the number of actual customers that went through the program yeah this is the very end this is the party at the end when the check is validated the numbers are verified and the check is on the mail in the mail from the internal revenue service heading to the customer so that’s how you’re able to track it you know when you
get this you understand 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 don’t pay bottom line Wonder trust anything until this letter is validated the check is on the method they deposit it into their savings account and they can really trust Wonder trust that the procedure has been completed and the number of you think you’ve processed since you started this we’re about 35 000 of these for
about 6 billion dollars wow so plainly they know what they’re doing and that’s what you need you need professionals 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 talking about something truly important today the employee retention credit which the majority of you have never ever heard of I definitely hadn’t heard of it till really just recently and learned a lot about it because this is probably the lowest expense of capital for any small business anywhere
anytime if you have workers in between 5 and five hundred so I have actually got the expert with me this is Josh Fox he’s the creator and CEO of bottom line Principles they’re the biggest processor of these ERC credits this is a 170 page program so it’s difficult this isn’t like PPP we just call your bank manager and state give me a loan it does not 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’ve become yes the Ambassador and paid representative for this I like this program it’s disappearing soon you got to discover everything about it let’s talk employee retention credit Josh Fox what is an ERC let’s simply begin there so throughout the Trump Administration when President Trump was enacted they developed the cares Act and the cares act offered services 3 chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically everybody it makes a huge distinction right there two of them are loans and one’s a refund precisely so the ERC is a refund that’s.
remedy the money cash payroll tax refund alright go on sorry I just need to make sure we got that point I mean that’s a huge difference a loan versus cash cash I like cash money that’s what we’re talking about okay 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 hard check in the mail where you get real money from the IRS all right so let’s discuss 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 staff member so I’m going to make the Assumption 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 actually owned a business but it’s based upon 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 qualified so you have to be on payroll in 2020 on the W-2 and you need to be on payroll for the first 6 months of 2021 on the W-2 proper so there were 6 quarters the program was open well stroll 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. fine so that’s how it’s determined you need to be on the W-2 throughout that period now let’s talk my preferred part cash how much can you return per staff member that was on a W-2 in those 6 quarters so the computation in 2020 to be precise Kevin is 50 of the employee’s salary to an optimum of five thousand dollars per employee for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the worker’s salary to an optimum of seven thousand per quarter how did that occur um they simply changed the rules in.
2021 versus since 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 approximately 5 thousand Max and after that what takes place 21 000 Max in 2021 oh that’s how you develop twenty six thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty six thousand dollars per worker that is because that’s a lot of cash it is now there’s a caveat here the PPP cash would have to be reduced from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan 2 you would decrease the 26 000 so what we’re seeing on average Kevin is if you took PPP money someplace around 10 thousand dollars an individual 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 money you would still get a million dollar in the mail from the internal revenue service so it’s big certainly now the big concern is why does nobody know about this because look when I initially became aware of this when I first fulfilled Josh you know I have actually got lots of investments in lots of companies I’m a major supporter for entrepreneurship in America and make numerous lots of investments in entrepreneurs of which lots of suffered through the pandemic when I initially found out about this I called BS I don’t think it since I utilize 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 deserved and we used them sensibly to stay alive during the pandemic so when I heard about this I stated nah it can’t be true however when I dug around I even called to my politician good friends Governor Senators they didn’t understand about it I imply that’s how you know that’s how misinformation is that there’s no details out there then a lot of individuals told me well you can’t get it due to the fact that you took the PPP also not real so let’s ask Josh why does no one know about the staff member retention credit you know what’s interesting you’re talking about the banks Kevin because in the PPP loan procedure the federal government made it very clear that if you wanted a PPP loan you would call Wells Fargo Citibank Bank of America any of the huge 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 simply procedure process that’s all um and here there was turmoil since keep in mind in the original cares act you could not do both programs so if you had done PPP you might refrain from doing ERC in the initial program and when they altered the law in 2021 the banks were not doing ERC due to the fact that 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 really he or she’s never ever done it in the past 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 accountant no your accounting professional’s never ever done this before unless you have an account that went into this service and bottom line my firm Kevin has been in business because 2009 and we’ve been working with the federal government and the state federal government to recover money for Fortune 500 Fortune 1000 business so a lot of our big huge corporate customers have worked with bottom line to recover other federal government programs we have actually done sales tax and use tax unemployment tax work opportunity tax credits research and development tax credits unclaimed home real estate tax all of these other federal government programs.
The employee retention tax credit is a broad based refundable tax credit developed to encourage.
companies to keep staff members on their payroll. The credit is 50% of as much as $10,000 in earnings paid by an.
Due to the fact that of COVID-19 or whose gross invoices, company whose company is fully or partly suspended.
decline by more than 50%.
1. The credit is offered to all companies no matter size including tax exempt organizations. There are.
just 2 exceptions: (1) state and local governments and their instrumentalities and (2) little.
companies who take Small Business Loans.
2. To certify, the employer needs to satisfy one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the company’s company is totally or partly suspended by government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross invoices are listed below 50% of the comparable quarter in 2019. As soon as the.
employer’s gross invoices exceed 80% of a comparable quarter in 2019 they no longer qualify.
after the end of that quarter.
Estimation of the Credit.
The quantity of the credit is 50% of the qualifying wages paid up to $10,000 in overall.
It is effective for wages paid after March 13th and prior to December 31, 2020.
The definition of certifying incomes differs by whether a company had, typically, basically than.
100 workers in 2019.
Business that specialize in ERC filing assistance generally offer competence and support to help services browse the intricate process of declaring the credit. They can use different services, including:.
How is the employee retention credit calculated? Is Employee Retention Credit A Real Thing
Eligibility Assessment: These business will evaluate your company’s eligibility for the ERC based on aspects such as your industry, revenue, and operations. They can assist identify if you fulfill the requirements for the credit and determine the optimum credit amount you can claim.
Documents and Calculation: ERC filing services will help in gathering the required documents, such as payroll records and monetary declarations, to support your claim. They will also assist compute the credit amount based on qualified wages and other certifying costs.
Retroactive Claim Review: If you are eligible to declare the ERC for previous quarters, these companies can evaluate your past payroll records and financials to identify potential chances for retroactive credits. They can help you modify previous tax returns to declare these refunds.
Filing Help: Companies focusing on ERC filings will prepare and submit the necessary kinds and paperwork on your behalf. This consists of finishing Kind 941 or any other necessary tax forms.
Compliance and Updates: ERC guidelines and assistance have actually evolved with time. These companies stay upgraded with the latest changes and ensure that your filings comply with the most present guidelines. They can also provide continuous assistance if the internal revenue service demands additional information or conducts an audit related to your ERC claim.
It’s important to research and veterinarian any company providing ERC filing help to guarantee their trustworthiness and expertise. Try to find recognized companies with experience in tax and payroll services, or think about connecting to relied on accounting companies or tax professionals who provide ERC submitting support.
Bear in mind that while these companies can offer important help, it’s constantly a great concept to have a basic understanding of the ERC requirements and process yourself. This will assist you make notified decisions 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 measures. The goal of the ERC is to encourage businesses to retain and pay their workers throughout the pandemic, even if their operations have been affected.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is offered to qualified employers, consisting of for-profit organizations, tax-exempt companies, and certain governmental entities. To certify, employers must fulfill one of two criteria:.
The business operations were fully or partially suspended due to a federal government order related to COVID-19.
Business experienced a significant decrease in gross invoices. As pointed out earlier, for 2021, a significant decrease is defined as a 20% decline in gross invoices compared to the very 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% decline in gross invoices compared to the right away preceding quarter.
Credit Amount: The ERC is a refundable tax credit that offsets the employer’s share of Social Security taxes. The credit amount amounts to a percentage (as much as 70%) of qualified salaries paid to employees, including particular health plan expenditures. 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, businesses that received a Paycheck Defense Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 allows companies to declare the ERC even if they received a PPP loan. However, the same earnings can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has actually been retroactively broadened and improved, allowing eligible employers to declare the credit for qualified incomes paid as far back as March 13, 2020. This retroactive arrangement supplies an opportunity for organizations to amend prior-year tax returns and get refunds.
Claiming the Credit: Companies can claim the ERC by reporting it on their work tax returns, typically Type 941. If the credit exceeds the quantity of work taxes owed, the excess can be reimbursed to the company.
It’s important to keep in mind that the ERC provisions and eligibility requirements have progressed with time. The very best strategy is to speak with a tax expert or go to the official internal revenue service site for the most current and comprehensive details regarding the ERC, including any recent legal modifications or updates.
To receive the ERC, a service must meet one of the following criteria:.
Business operations were completely or partially suspended due to a federal government order related to COVID-19.
The business experienced a substantial decrease in gross receipts. For 2021, a substantial decline is defined as a 20% decrease in gross invoices compared to the very 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 immediately preceding quarter.
The ERC is offered to businesses of all sizes, consisting of tax-exempt organizations, but there are some exceptions. Federal government entities and businesses that got a PPP loan might have constraints on claiming the credit.
The process for declaring the ERC involves finishing the required types and including the credit on your work income tax return (usually Kind 941). The exact time it takes to process the credit can vary based on several aspects, consisting of the complexity of your organization and the workload of the IRS. It’s recommended to speak with a tax expert for guidance particular to your circumstance.
There are several business that can help with the process of claiming the ERC. These consist of accounting firms, tax advisory services, and payroll service providers. Some widely known business that use help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s a good idea to research study and call these companies straight to ask about their services and costs.
Please note that the information offered here is based upon general understanding and may not show the most current updates or changes to the ERC. It’s important to speak with a tax expert or go to the official internal revenue service website for the most accurate and updated details relating to eligibility, declaring procedures, and available assistance.
Less than 100. The credit is based if the company had 100 or less employees on average in 2019.
on incomes paid to all workers whether they really worked or not. Simply put, even if the.
employees worked full-time and got paid for full time work, the employer still gets the credit.
Greater than 100. The credit is if the employer had more than 100 workers on average in 2019.
permitted only for earnings paid to employees who did not work during the calendar quarter.
In both cases, “salaries” includes not just money payments but also a portion of the cost of company.
supplied health care. Is Employee Retention Credit A Real Thing
Companies can be instantly repaid for the credit by reducing the quantity of payroll taxes they.