Lets talk first about New Stimulus Package Employee Retention Credit :
Our group here what do these people doing everybody in this room is helping teach individuals about ERC and uh always offer a gorgeous breakfast and have individuals actually learn about the program we need to head to the room where we are able to display some of the checks that we are getting for business 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 replicate copies of the letters that go to customers validating that the check is on the method I suggest you know if you just begin to 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 just I suggest consider how many 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 internal revenue service heading to the consumer so that’s how you’re able to track it you know when you
get this you understand the check is opted for sure which’s when they pay so they don’t pay anything up until they in fact receive the money they don’t pay bottom line Wonder trust anything till this letter is verified the check is on the way they deposit it into their checking account and they can genuinely trust Wonder trust that the procedure has been finished and the number of you believe you have actually processed since you began this we have to do with 35 000 of these for
about 6 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 among these that’s what matters all right Mr Wonderful here you’re at my YouTube channel we’re speaking about something truly important today the staff member retention credit which the majority of you have never heard of I definitely hadn’t heard of it up until really recently and learned a lot about it since this is probably the most affordable expense of capital for any small business anywhere
anytime if you have staff members in between five 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 challenging this isn’t like PPP we just call up your bank manager and say give me a loan it doesn’t 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’ve become yes the Ambassador and paid representative 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 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 everybody it makes a big difference right there 2 of them are loans and one’s a refund exactly so the ERC is a refund that’s.
fix the cash cash payroll tax refund alright go on sorry I just have to ensure we got that point I indicate that’s a huge distinction a loan versus money cash I like cash money that’s what we’re talking 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 initial cares Act is the ERC and yes Kevin it is a lovely tough check in the mail where you get real money from the IRS all right so let’s speak 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 an employee so I’m going to make the Presumption this money is not for the owner not for individuals on the cap table not for investors it’s for staff members right you had to have actually owned a service however it’s based upon you having W-2 staff members in America not 10.99. 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 have to be on payroll for the very first 6 months of 2021 on the W-2 right so there were six quarters the program was open well walk us through the 6 quarters so you had quarters 2 3 and four of 2020 and you had quarters one 2 and 3 of 2021. alright so that’s how it’s measured you need to be on the W-2 during that duration now let’s talk my favorite part money just how much can you return per worker that was on a W-2 in those 6 quarters so the calculation in 2020 to be exact Kevin is 50 of the staff member’s wage to a maximum of five 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 seven thousand per quarter how did that occur um they just changed the rules in.
2021 versus due to the fact that the mayhem of the pandemic so they wanted 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 up to 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 five thousand in twenty twenty that’s twenty 6 thousand dollars per worker that is because that’s a lot of money it is now there’s a caution 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 lower the 26 000 so what we’re seeing usually Kevin is if you took PPP money somewhere around ten thousand dollars an individual so let’s say hypothetically you owned a dining establishment in New York City where I’m from and you had a hundred staff members and you took PPP cash you would still get a million dollar in the mail from the IRS so it’s huge obviously now the huge concern is why does nobody understand about this because look when I initially became aware of this when I first fulfilled Josh you understand I’ve got lots of financial investments in great deals of companies I’m a significant advocate for entrepreneurship in America and make lots of lots of investments in entrepreneurs of which numerous suffered through the pandemic when I initially heard about this I called BS I do not believe 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 been worthy of and we used them wisely to survive during the pandemic so when I found out about this I said nah it can’t be true however when I dug around I even contacted us to my political leader good friends 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 lot of individuals informed me well you can’t get it due to the fact that you took the PPP also not true so let’s ask Josh why does no one know about the staff member retention credit you understand what’s fascinating you’re speaking about the banks Kevin because in the PPP loan process the federal government made it extremely clear that if you wanted 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 just process process that’s all um and here there was mayhem due to the fact that remember in the original cares act you might refrain from doing both programs so if you had done PPP you could not do 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 government never made it clear to any person about how to.
do this does your CFO know how to do this not truly she or he’s never done it previously 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 accountant’s never ever done this before unless you have an account that entered into this company and bottom line my firm Kevin has stayed in business given that 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 lot of our huge big corporate clients have worked with bottom line to recuperate other federal government programs we have actually done sales tax and utilize tax joblessness tax work chance tax credits research and development tax credits unclaimed property real estate tax all of these other government programs.
The staff member retention tax credit is a broad based refundable tax credit created to motivate.
employers to keep employees on their payroll. The credit is 50% of as much as $10,000 in salaries paid by an.
employer whose organization is fully or partially suspended because of COVID-19 or whose gross receipts.
decline by more than 50%.
1. The credit is readily available to all companies despite size including tax exempt companies. There are.
just 2 exceptions: (1) state and city governments and their instrumentalities and (2) small.
organizations who take Small company Loans.
2. To qualify, the employer has to satisfy one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the company’s organization is totally or partly suspended by federal government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross receipts are listed below 50% of the comparable quarter in 2019. As soon as the.
employer’s gross receipts 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 qualifying incomes paid up to $10,000 in total.
It is effective for salaries paid after March 13th and before December 31, 2020.
The definition of certifying wages differs by whether an employer had, typically, basically than.
100 employees in 2019.
Companies that specialize in ERC filing assistance normally supply proficiency and support to help businesses navigate the complex procedure of declaring the credit. They can provide numerous services, consisting of:.
How is the employee retention credit calculated? New Stimulus Package Employee Retention Credit
Eligibility Evaluation: These business will evaluate your service’s eligibility for the ERC based upon aspects such as your industry, profits, and operations. If you satisfy the requirements for the credit and identify the optimum credit amount you can declare, they can help determine.
Paperwork and Calculation: ERC filing services will help in collecting the needed documentation, such as payroll records and monetary statements, to support your claim. They will likewise help calculate the credit amount based on qualified earnings and other certifying costs.
Retroactive Claim Evaluation: If you are eligible to declare the ERC for prior quarters, these business can review your past payroll records and financials to determine prospective chances for retroactive credits. They can assist you amend prior tax returns to declare these refunds.
Filing Help: Companies specializing in ERC filings will prepare and submit the essential types and paperwork in your place. This includes completing Type 941 or any other necessary tax forms.
Compliance and Updates: ERC policies and guidance have actually developed gradually. These companies stay upgraded with the latest changes and make sure that your filings abide by the most present guidelines. If the IRS requests additional information or performs an audit associated to your ERC claim, they can likewise offer ongoing assistance.
It is essential to research and veterinarian any business providing ERC filing help to ensure their credibility and knowledge. Search for established companies with experience in tax and payroll services, or think about reaching out to trusted accounting firms or tax professionals who provide ERC filing assistance.
Bear in mind that while these business can supply important help, it’s always an excellent concept to have a fundamental understanding of the ERC requirements and procedure yourself. This will assist you make notified decisions and guarantee precise 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 encourage organizations to keep and pay their workers throughout the pandemic, even if their operations have actually been impacted.
Here are some key points about the ERC:.
Eligibility: The ERC is available to qualified employers, including for-profit organizations, tax-exempt companies, and certain governmental entities. To certify, employers must fulfill one of two requirements:.
Business operations were totally or partly suspended due to a federal government order related to COVID-19.
Business experienced a considerable decrease in gross receipts. As mentioned previously, for 2021, a considerable decline is defined as a 20% decline in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a substantial decline is defined as a 20% decline in gross receipts compared to the 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 amount amounts to a portion (up to 70%) of certified salaries paid to staff members, consisting of certain health insurance expenditures. The maximum credit per staff member is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: At first, organizations that received a Paycheck Protection Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 enables businesses to declare the ERC even if they received a PPP loan. However, the very same incomes can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively broadened and enhanced, permitting qualified companies to declare the credit for qualified earnings paid as far back as March 13, 2020. This retroactive provision supplies a chance for services to change prior-year tax returns and get refunds.
Declaring the Credit: Employers can claim the ERC by reporting it on their employment income tax return, usually Form 941. The excess can be reimbursed to the employer if the credit surpasses the quantity of work taxes owed.
It is essential to note that the ERC provisions and eligibility requirements have actually progressed in time. The very best strategy is to consult with a tax professional or check out the main IRS website for the most detailed and updated details relating to the ERC, consisting of any recent legal changes or updates.
To qualify for the ERC, a company must meet among the following requirements:.
The business operations were fully or partially suspended due to a government order related to COVID-19.
The business experienced a considerable decrease in gross invoices. For 2021, a considerable decline is specified as a 20% decline in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a significant decline is specified as a 20% decrease in gross receipts compared to the exact same quarter in 2019, or a 20% decrease in gross invoices compared to the instantly preceding quarter.
The ERC is readily available to companies of all sizes, consisting of tax-exempt organizations, however there are some exceptions. Government entities and companies that received a PPP loan might have restrictions on claiming the credit.
The process for declaring the ERC includes finishing the needed kinds and consisting of the credit on your work income tax return (usually Kind 941). The exact time it requires to process the credit can vary based on several aspects, consisting of the complexity of your service and the workload of the internal revenue service. It’s recommended to speak with a tax professional for assistance particular to your situation.
There are numerous companies that can assist with the procedure of claiming the ERC. These include accounting companies, tax advisory services, and payroll service providers. Some widely known business that offer assistance with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s recommended to research and call these business straight to ask about their costs and services.
Please keep in mind that the info provided here is based on general understanding and might not show the most recent updates or changes to the ERC. It is very important to seek advice from a tax professional or visit the official IRS website for the most current and accurate details regarding eligibility, declaring procedures, and offered support.
Less than 100. The credit is based if the company had 100 or less employees on average in 2019.
on earnings paid to all workers whether they actually 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. The credit is if the employer had more than 100 employees on average in 2019.
enabled just for salaries paid to employees who did not work during the calendar quarter.
In both cases, “wages” includes not just cash payments but also a portion of the cost of employer.
supplied health care. New Stimulus Package Employee Retention Credit
Employers can be instantly reimbursed for the credit by decreasing the quantity of payroll taxes they.