Lets talk first about Jj The Cpa Employee Retention Credit :
Our group here what do these men doing everyone in this space is helping teach people about ERC and uh constantly offer a stunning breakfast and have individuals actually learn more about the program we must head to the space where we are able to show a few of the checks that we are getting for companies and I wish to see that what is this this is uh hundreds of countless dollars actually Kevin numerous millions of dollars so these are duplicate copies of the letters that go to clients verifying that the check is on the way I suggest you know if you just begin to look at a few of these here I indicate this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I mean it’s just I indicate think of the number of real 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 validated and the check is on the mail in the mail from the IRS heading to the customer so that’s how you’re able to track it you understand when you
receive this you understand the check is opted 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 until this letter is verified the check is on the way they deposit it into their savings account and they can really trust Wonder trust that the procedure has actually been completed and how many you believe you have actually processed given that you began this we’re about 35 000 of these for
about 6 billion dollars wow so clearly they understand what they’re doing which’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 talking about something truly important today the employee retention credit which the majority of you have never ever become aware of I certainly had not heard of it until extremely just recently and found out a lot about it due to the fact that this is probably the most affordable cost of capital for any small business anywhere
anytime if you have employees between 5 and five hundred so I have actually got the specialist 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 difficult this isn’t like PPP we simply contact your bank supervisor and state offer me a loan it doesn’t work there’s not a loan it’s an application and Josh is going to tell all of us about it and how to get it and why I’ve become yes the Ambassador and paid spokesperson for this I enjoy this program it’s disappearing soon you got to find out all 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 came up with the cares Act and the cares act provided services 3 opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly everyone it makes a big distinction right there two of them are loans and one’s a refund precisely so the ERC is a refund that’s.
correct the cash money payroll tax refund alright go on sorry I simply need to make sure we got that point I suggest that’s a big difference a loan versus money money 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 gorgeous difficult check in the mail where you get actual cash from the internal revenue service all right so let’s discuss how it works due to the fact that it sounds like to me if it’s a if it’s employee retention credit that person needed to be an employee so I’m going to make the Presumption this money is not for the owner not for people on the cap table not for investors it’s for employees right you had to have owned a service but it’s based on you having W-2 employees in America not 10.99. so as long as you had W-2 employees 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 very 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 three and four of 2020 and you had quarters one two and three of 2021. fine 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 cash just how much can you get back per employee that was on a W-2 in those 6 quarters so the estimation in 2020 to be exact Kevin is 50 of the staff member’s wage to an optimum of five thousand dollars per employee for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the employee’s income to a maximum of seven thousand per quarter how did that take place um they simply changed the rules in.
2021 versus due to the fact that 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 approximately five thousand Max and after that what happens 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 worker that is because that’s a great deal of money it is now there’s a caveat here the PPP money would have to be decreased 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 typically Kevin is if you took PPP cash somewhere around ten thousand dollars a person 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 cash you would still get a million dollar in the mail from the IRS so it’s big obviously now the huge concern is why does no one learn about this because appearance when I initially became aware of this when I first met Josh you know I have actually got lots of investments in lots of business I’m a significant supporter for entrepreneurship in America and make many many financial investments in entrepreneurs of which numerous suffered through the pandemic when I initially found out about this I called BS I do not think it because I use the PPP we went through the cash center Banks to get it it was really 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 survive during the pandemic so when I found out about this I stated nah it can’t hold true however when I dug around I even contacted us to my political leader pals Governor Senators they didn’t learn about it I indicate that’s how you understand that’s how false information is that there’s no information out there then a lot of people told me well you can’t get it since you took the PPP also not true so let’s ask Josh why does no one know about the worker retention credit you understand what’s intriguing you’re discussing the banks Kevin since 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 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 simply procedure process that’s all um and here there was turmoil because keep in mind in the original cares act you might not do both programs so if you had done PPP you might not do ERC in the original program and when they altered 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 actually he or she’s never ever done it before do the banks do it nope the banks don’t do it the payroll business yeah a few of them are doing it as a payroll business your accounting professional no your accounting professional’s never 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’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 huge huge business clients have worked with bottom line to recuperate other federal government programs we’ve done sales tax and utilize tax joblessness tax work opportunity tax credits research and development tax credits unclaimed home property tax all of these other government programs.
The staff member retention tax credit is a broad based refundable tax credit created to motivate.
companies to keep staff members on their payroll. The credit is 50% of up to $10,000 in earnings paid by an.
Because of COVID-19 or whose gross invoices, employer whose company is completely or partially suspended.
decrease by more than 50%.
1. The credit is readily available to all companies despite size consisting of tax exempt companies. There are.
only 2 exceptions: (1) state and local governments and their instrumentalities and (2) little.
services who take Small Business Loans.
2. To qualify, the company has to fulfill one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the company’s service is completely or partly suspended by government order due to COVID-19.
during the calendar quarter or.
o the company’s gross invoices are listed below 50% of the similar quarter in 2019. As soon as the.
employer’s gross receipts exceed 80% of a comparable quarter in 2019 they no longer qualify.
after completion of that quarter.
Estimation of the Credit.
The amount of the credit is 50% of the qualifying wages paid up to $10,000 in total.
It works for wages paid after March 13th and prior to December 31, 2020.
The definition of certifying salaries varies by whether a company had, typically, more or less than.
100 employees in 2019.
Business that specialize in ERC filing support usually supply knowledge and assistance to assist organizations browse the intricate process of claiming the credit. They can provide various services, including:.
How is the employee retention credit calculated? Jj The Cpa Employee Retention Credit
Eligibility Assessment: These business will evaluate your organization’s eligibility for the ERC based on factors such as your market, earnings, and operations. If you meet the requirements for the credit and identify the optimum credit quantity you can claim, they can help identify.
Documentation and Estimation: ERC filing services will assist in collecting the necessary documents, such as payroll records and monetary statements, to support your claim. They will likewise help calculate the credit quantity based upon eligible salaries and other certifying expenditures.
Retroactive Claim Review: If you are eligible to claim the ERC for previous quarters, these companies can examine your past payroll records and financials to determine possible opportunities for retroactive credits. They can help you amend previous tax returns to declare these refunds.
Filing Help: Companies focusing on ERC filings will prepare and submit the needed forms and paperwork on your behalf. This includes finishing Type 941 or any other necessary tax forms.
Compliance and Updates: ERC regulations and guidance have progressed with time. These business stay updated with the current changes and make sure that your filings abide by the most current standards. If the IRS demands additional details or carries out an audit related to your ERC claim, they can likewise offer ongoing support.
It is very important to research study and vet any company providing ERC filing support to guarantee their trustworthiness and proficiency. Look for recognized firms with experience in tax and payroll services, or think about connecting to relied on accounting firms or tax professionals who offer ERC submitting assistance.
Bear in mind that while these business can offer valuable support, it’s constantly an excellent idea to have a basic understanding of the ERC requirements and procedure yourself. This will help you make notified decisions and make sure precise filings.
The Employee Retention Credit (ERC) is a refundable tax credit introduced by the U.S. federal government as part of COVID-19 relief steps. The goal of the ERC is to encourage services to maintain and pay their staff members throughout the pandemic, even if their operations have actually been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is readily available to qualified employers, consisting of for-profit services, tax-exempt organizations, and specific governmental entities. To qualify, employers should fulfill one of two criteria:.
The business operations were fully or partially suspended due to a federal government order related to COVID-19.
The business experienced a considerable decline in gross invoices. As pointed out earlier, for 2021, a considerable decrease is defined as a 20% decline in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a considerable decrease is defined as a 20% decrease in gross receipts compared to the very same quarter in 2019, or a 20% decrease in gross receipts compared to the right away preceding quarter.
Credit Amount: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit quantity is equal to a percentage (as much as 70%) of certified salaries paid to workers, consisting of specific health plan expenses. The maximum 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 a Paycheck Protection Program (PPP) loan were not eligible for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 allows organizations to claim the ERC even if they got a PPP loan. The same wages can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively expanded and improved, enabling eligible employers to claim the credit for certified incomes paid as far back as March 13, 2020. This retroactive provision provides a chance for services to modify prior-year income tax return and receive refunds.
Declaring the Credit: Companies can declare the ERC by reporting it on their employment income tax return, normally Kind 941. The excess can be refunded to the employer if the credit exceeds the quantity of work taxes owed.
It is essential to note that the ERC provisions and eligibility requirements have actually developed gradually. The best strategy is to consult with a tax professional or visit the official internal revenue service site for the most up-to-date and comprehensive info relating to the ERC, consisting of any recent legal modifications or updates.
To get approved for the ERC, an organization must satisfy one of the following criteria:.
Business operations were completely or partially suspended due to a government order related to COVID-19.
Business experienced a substantial decrease in gross invoices. For 2021, a considerable decrease is specified as a 20% decline in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a significant decrease 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 immediately preceding quarter.
The ERC is readily available to services of all sizes, including tax-exempt organizations, but there are some exceptions. Federal government entities and organizations that got a PPP loan may have constraints on claiming the credit.
The procedure for declaring the ERC includes completing the required kinds and including the credit on your work income tax return (typically Kind 941). The exact time it requires to process the credit can differ based upon numerous aspects, consisting of the intricacy of your business and the work of the IRS. It’s suggested to seek advice from a tax expert for guidance particular to your scenario.
There are several companies that can help with the procedure of declaring the ERC. Some well-known companies that offer support with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the information offered here is based on basic understanding and may not reflect the most current updates or changes to the ERC. It is very important to consult with a tax expert or visit the main IRS site for the most precise and updated info relating to eligibility, claiming procedures, and offered assistance.
Less than 100. The credit is based if the employer had 100 or fewer employees on average in 2019.
on incomes paid to all workers whether they actually worked or not. Simply put, 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 staff members typically in 2019, then the credit is.
allowed just for salaries paid to staff members who did not work throughout the calendar quarter.
In both cases, “incomes” includes not just money payments however also a portion of the cost of employer.
offered healthcare. Jj The Cpa Employee Retention Credit
Companies can be immediately repaid for the credit by decreasing the amount of payroll taxes they.