Lets talk first about Is My Company Eligible For 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 lovely breakfast and have individuals really learn more about the program we ought to head to the room where we have the ability 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 hundreds of countless dollars so these are replicate copies of the letters that go to clients validating that the check is on the method I imply 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 indicate it’s just I mean think of how many actual customers that went through the program yeah this is the very end this is the celebration at the end when the check is confirmed 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 opted for sure and that’s when they pay so they do not pay anything till they actually receive the money they do not pay bottom line Wonder trust anything till this letter is validated the check is on the way they deposit it into their checking account and they can really trust Wonder trust that the process has actually been ended up and the number of you think you’ve 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 and that’s what you require 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 Fantastic here you’re at my YouTube channel we’re speaking about something really important today the worker retention credit which most of you have actually never become aware of I definitely had not become aware of it till very just recently and found out a lot about it since this is probably the lowest cost of capital for any small business anywhere
anytime if you have staff members between 5 and five hundred so I’ve got the professional with me this is Josh Fox he’s the founder and CEO of bottom line Concepts 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 call up your bank manager and say provide 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 representative for this I enjoy this program it’s going away very soon you got to learn all about it let’s talk staff member 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 used companies 3 opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically everyone it makes a huge distinction right there 2 of them are loans and one’s a refund exactly so the ERC is a refund that’s.
remedy the money money payroll tax refund fine go on sorry I just need to ensure we got that point I imply that’s a huge difference a loan versus money cash I like cash money 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 stunning difficult check in the mail where you get real money from the IRS 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 had to be a staff member so I’m going to make the Assumption this cash 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 company but it’s based upon you having W-2 employees in America not 10.99. 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 have to be on payroll for the very first six 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 3 and 4 of 2020 and you had quarters one 2 and 3 of 2021. fine so that’s how it’s measured you need to be on the W-2 throughout that period now let’s talk my favorite part money just how much can you return per staff member that was on a W-2 in those 6 quarters so the calculation in 2020 to be precise Kevin is 50 of the worker’s wage to an optimum of five thousand dollars per worker for the year of 2020 and in 2021 the numbers increased to 70 of the employee’s wage to an optimum of 7 thousand per quarter how did that occur 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 up to 5 thousand Max and after that what takes place 21 000 Max in 2021 oh that’s how you create twenty six thousand twenty one thousand to twenty twenty one plus five thousand in twenty twenty that’s twenty six thousand dollars per employee that is because that’s a lot of money it is now there’s a caveat here the PPP cash would have to be reduced 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 cash someplace around ten 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 staff members and you took PPP money you would still get a million dollar in the mail from the internal revenue service so it’s substantial clearly now the huge question is why does no one understand about this because look when I first became aware of this when I first satisfied Josh you know I’ve got great deals of investments in lots of companies I’m a significant supporter for entrepreneurship in America and make many lots of financial investments in entrepreneurs of which many suffered through the pandemic when I first found out about this I called BS I do not think it because I utilize the PPP we went through the money center Banks to get it it was extremely easy to do we had our CEOs call the banks they got their loans which were well should have and we used them sensibly to survive during the pandemic so when I heard about this I said nah it can’t hold true however when I dug around I even contacted us to my politician buddies Governor Senators they didn’t learn about it I imply that’s how you understand that’s how misinformation is that there’s no info out there then a bunch of individuals told me well you can’t get it due to the fact that you took the PPP likewise not real so let’s ask Josh why does nobody learn about the worker retention credit you understand what’s intriguing you’re discussing the banks Kevin because in the PPP loan procedure the federal government made it very 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 procedure 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 chaos due to the fact that keep in mind in the initial cares act you might refrain from doing both programs so if you had actually done PPP you could refrain from doing ERC in the original program and when they changed 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 anyone about how to.
do this does your CFO know how to do this not actually he or she’s never done it in the past do the banks do it nope the banks don’t do it the payroll companies yeah a few of them are doing it as a payroll business your accounting professional no your accountant’s never ever done this prior to unless you have an account that entered into this company and bottom line my firm Kevin has been in business because 2009 and we have actually been dealing with the federal government and the state government to recover cash for Fortune 500 Fortune 1000 companies so a great deal of our huge big corporate clients have actually worked with bottom line to recuperate other federal government programs we have actually done sales tax and use tax joblessness tax work chance 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 developed to encourage.
companies to keep employees on their payroll. The credit is 50% of up to $10,000 in earnings paid by an.
employer whose service is totally or partially suspended because of COVID-19 or whose gross invoices.
decline by more than 50%.
1. The credit is available to all companies despite size including tax exempt organizations. There are.
only 2 exceptions: (1) state and local governments and their instrumentalities and (2) little.
companies who take Small company Loans.
2. To qualify, the company has to fulfill one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the company’s service is fully or partially suspended by federal government order due to COVID-19.
during the calendar quarter or.
o the company’s gross receipts are below 50% of the similar quarter in 2019. When the.
company’s gross invoices exceed 80% of an equivalent quarter in 2019 they no longer certify.
after the end of that quarter.
Computation of the Credit.
The amount of the credit is 50% of the qualifying incomes paid up to $10,000 in overall.
It is effective for incomes paid after March 13th and prior to December 31, 2020.
The definition of certifying salaries varies by whether a company had, usually, basically than.
100 staff members in 2019.
Business that focus on ERC filing assistance normally supply proficiency and support to help companies browse the complex process of declaring the credit. They can provide different services, including:.
How is the employee retention credit calculated? Is My Company Eligible For Employee Retention Credit
Eligibility Assessment: These companies will assess your business’s eligibility for the ERC based on aspects such as your market, earnings, and operations. If you satisfy the requirements for the credit and determine the optimum credit quantity you can claim, they can help determine.
Documentation and Calculation: ERC filing services will assist in collecting the necessary documents, such as payroll records and monetary statements, to support your claim. They will also assist determine the credit amount based upon qualified wages and other certifying costs.
Retroactive Claim Review: If you are eligible to claim the ERC for prior quarters, these companies can review your previous payroll records and financials to recognize possible chances for retroactive credits. They can help you amend previous income tax return to claim these refunds.
Filing Support: Companies specializing in ERC filings will prepare and submit the essential kinds and documentation in your place. This includes finishing Type 941 or any other necessary tax return.
Compliance and Updates: ERC policies and assistance have evolved in time. These business stay updated with the most recent changes and ensure that your filings comply with the most existing guidelines. If the Internal revenue service demands additional info or conducts an audit associated to your ERC claim, they can likewise provide continuous support.
It is necessary to research study and veterinarian any business using ERC filing help to ensure their credibility and expertise. Try to find established companies with experience in tax and payroll services, or think about connecting to relied on accounting companies or tax professionals who offer ERC filing support.
Remember that while these business can supply valuable assistance, it’s always a great idea to have a standard understanding of the ERC requirements and procedure yourself. This will help you make informed choices and ensure precise filings.
The Employee Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief measures. The objective of the ERC is to encourage businesses to maintain and pay their workers throughout the pandemic, even if their operations have been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is offered to qualified employers, including for-profit services, tax-exempt organizations, and specific governmental entities. To qualify, companies should satisfy one of two criteria:.
The business operations were fully or partly suspended due to a federal government order related to COVID-19.
Business experienced a considerable decrease in gross invoices. As mentioned previously, for 2021, a significant decline is specified as a 20% decline in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a substantial decrease is specified as a 20% decline in gross receipts compared to the 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 is equal to a percentage (approximately 70%) of certified salaries paid to employees, including particular health plan expenses. 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, companies that received an Income Protection Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 enables companies to declare the ERC even if they got a PPP loan. Nevertheless, 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 improved, permitting qualified employers to claim the credit for qualified wages paid as far back as March 13, 2020. This retroactive arrangement provides a chance for businesses to change prior-year income tax return and get refunds.
Declaring the Credit: Companies can claim the ERC by reporting it on their work tax returns, typically Kind 941. The excess can be reimbursed to the employer if the credit goes beyond the amount of employment taxes owed.
It is essential to note that the ERC arrangements and eligibility requirements have progressed gradually. The best strategy is to speak with a tax expert or visit the official IRS website for the most detailed and up-to-date information concerning the ERC, consisting of any recent legal modifications or updates.
To get approved for the ERC, a service needs to fulfill among the following criteria:.
Business operations were totally or partly suspended due to a federal government order related to COVID-19.
The business experienced a substantial decline in gross receipts. For 2021, a considerable decline is defined as a 20% decrease in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a considerable decrease is specified as a 20% decline in gross receipts compared to the exact same quarter in 2019, or a 20% decrease 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. For instance, government entities and organizations that got a PPP loan might have restrictions on claiming the credit.
The process for declaring the ERC involves finishing the essential types and including the credit on your work tax return (typically Type 941). The exact time it takes to process the credit can vary based on a number of aspects, including the intricacy of your business and the workload of the internal revenue service. It’s recommended to consult with a tax expert for assistance particular to your situation.
There are a number of business that can aid with the procedure of claiming the ERC. These include accounting firms, tax advisory services, and payroll service providers. Some popular business that offer help with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s suggested to research and contact these companies directly to ask about their charges and services.
Please keep in mind that the info supplied here is based upon general knowledge and might not reflect the most recent updates or changes to the ERC. It is essential to seek advice from a tax professional or check out the official IRS website for the most up-to-date and precise details relating to eligibility, claiming treatments, and offered help.
Less than 100. If the employer had 100 or less employees on average in 2019, then the credit is based.
on earnings paid to all staff members whether they really worked or not. In other words, even if the.
workers worked full time and got paid for full-time work, the employer still gets the credit.
Greater than 100. If the employer had more than 100 workers typically in 2019, then the credit is.
permitted only for wages paid to employees who did not work during the calendar quarter.
In both cases, “earnings” consists of not just cash payments but likewise a part of the cost of employer.
offered healthcare. Is My Company Eligible For Employee Retention Credit
Companies can be immediately repaid for the credit by minimizing the amount of payroll taxes they.