Lets talk first about Payroll Tax Deferral And Employee Retention Credit :
Our team here what do these men doing everybody in this room is helping teach individuals about ERC and uh constantly provide a lovely breakfast and have people actually learn more about the program we need to head to the room where we are able 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 millions of dollars so these are duplicate copies of the letters that go to clients validating that the check is on the way I indicate you know if you simply begin to look at some 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 about how many 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 validated and the check is on the mail in the mail from the IRS heading to the consumer so that’s how you’re able to track it you know when you
receive this you know the check is gone for sure and that’s when they pay so they don’t pay anything till they actually receive the money they don’t pay bottom line Wonder trust anything till this letter is validated the check is on the method they deposit it into their savings account and they can genuinely rely on Wonder trust that the process has been finished and how many you believe you have actually processed since you started this we have to do with 35 000 of these for
about six billion dollars wow so plainly they understand 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 one of these that’s what matters all right Mr Fantastic here you’re at my YouTube channel we’re speaking about something truly essential today the employee retention credit which most of you have never ever become aware of I definitely hadn’t become aware of it up until extremely recently and learned a lot about it due to the fact that this is most likely the lowest cost of capital for any small company anywhere
anytime if you have employees between 5 and five hundred so I have actually got the expert with me this is Josh Fox he’s the founder and CEO of bottom line Principles they’re the largest processor of these ERC credits this is a 170 page program so it’s hard this isn’t like PPP we just contact your bank supervisor and state give me a loan it does not 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 ended up being yes the Ambassador and paid representative for this I love this program it’s disappearing soon you got to discover everything about it let’s talk worker retention credit Josh Fox what is an ERC let’s just start there so during the Trump Administration when President Trump was enacted they came up with 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 almost everyone it makes a big difference right there two of them are loans and one’s a refund precisely so the ERC is a refund that’s.
remedy the cash money payroll tax refund okay go on sorry I simply have to make certain we got that point I imply that’s a big difference a loan versus cash money I like money cash 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 initial cares Act is the ERC and yes Kevin it is a lovely difficult check in the mail where you get real cash from the internal revenue service 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 Presumption this cash is not for the owner not for individuals on the cap table not for shareholders it’s for employees right you needed to have actually owned a service but it’s based on you having W-2 workers 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 qualified so you need to be on payroll in 2020 on the W-2 and you need to be on payroll for the very first six months of 2021 on the W-2 right so there were 6 quarters the program was open well walk us through the six quarters so you had quarters two 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 cash how much can you return per employee that was on a W-2 in those 6 quarters so the computation in 2020 to be precise Kevin is 50 of the worker’s income to an optimum of 5 thousand dollars per employee for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the worker’s income to a maximum of 7 thousand per quarter how did that occur um they just altered the rules in.
2021 versus due to the fact that the mayhem 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 then what occurs 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 six thousand dollars per employee that is since that’s a great deal of cash it is now there’s a caveat here the PPP money would need to be minimized from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan two you would lower the 26 000 so what we’re seeing on average Kevin is if you took PPP money somewhere around 10 thousand dollars a person so let’s state hypothetically you owned a restaurant in New York 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 internal revenue service so it’s huge certainly now the huge question is why does nobody understand about this because look when I first found out about this when I initially met Josh you understand I have actually got great deals of financial investments in lots of companies I’m a significant supporter for entrepreneurship in America and make lots of numerous financial investments in entrepreneurs of which lots of suffered through the pandemic when I first found out about this I called BS I do not believe it since I use 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 which were well deserved and we utilized them wisely to survive throughout the pandemic so when I heard about this I stated nah it can’t be true however when I dug around I even contacted us to my political leader 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 info out there then a lot of people told me well you can’t get it because you took the PPP likewise not real so let’s ask Josh why does nobody know about the staff member retention credit you know what’s intriguing you’re discussing the banks Kevin due to the fact that 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 procedure 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 turmoil since keep in mind in the initial cares act you could not do both programs so if you had done PPP you could refrain from doing ERC in the original program and when they changed the law in 2021 the banks were refraining from doing ERC due to the fact that it’s not alone so you’re getting a tax refund so the federal government never ever 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 previously 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 accountant no your accountant’s never ever done this before unless you have an account that entered into this company and bottom line my company Kevin has stayed in business given that 2009 and we’ve been working with the federal government and the state government to recover money for Fortune 500 Fortune 1000 business so a lot of our huge big business customers have worked with bottom line to recuperate other government programs we have actually done sales tax and utilize tax unemployment tax work chance tax credits research and development tax credits unclaimed property real estate tax all of these other federal government programs.
The employee retention tax credit is a broad based refundable tax credit developed to motivate.
employers to keep staff members on their payroll. The credit is 50% of approximately $10,000 in salaries paid by an.
company whose organization is totally or partially suspended because of COVID-19 or whose gross invoices.
decrease by more than 50%.
1. The credit is available to all employers regardless of size including tax exempt companies. There are.
just 2 exceptions: (1) state and city governments and their instrumentalities and (2) little.
companies who take Small Business Loans.
2. To qualify, the employer has to fulfill one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the employer’s service is totally or partially suspended by federal government order due to COVID-19.
during the calendar quarter or.
o the company’s gross receipts are listed below 50% of the comparable quarter in 2019. When the.
employer’s gross receipts go above 80% of a similar quarter in 2019 they no longer certify.
after completion of that quarter.
Calculation of the Credit.
The amount of the credit is 50% of the certifying earnings paid up to $10,000 in overall.
It is effective for salaries paid after March 13th and prior to December 31, 2020.
The definition of certifying wages varies by whether an employer had, typically, basically than.
100 employees in 2019.
Companies that concentrate on ERC filing help usually provide competence and support to assist companies navigate the complex procedure of claiming the credit. They can offer numerous services, consisting of:.
How is the employee retention credit calculated? Payroll Tax Deferral And Employee Retention Credit
Eligibility Assessment: These companies will assess your organization’s eligibility for the ERC based upon factors such as your industry, revenue, and operations. They can assist determine if you meet the requirements for the credit and recognize the optimum credit amount you can declare.
Paperwork and Estimation: ERC filing services will help in gathering the essential paperwork, such as payroll records and financial declarations, to support your claim. They will likewise assist compute the credit amount based upon eligible wages and other qualifying costs.
Retroactive Claim Evaluation: If you are qualified to declare the ERC for previous quarters, these companies can review your past payroll records and financials to determine possible chances for retroactive credits. They can assist you modify previous tax returns to claim these refunds.
Filing Help: Business specializing in ERC filings will prepare and send the required kinds and documents on your behalf. This consists of finishing Form 941 or any other required tax return.
Compliance and Updates: ERC regulations and assistance have progressed with time. These business stay upgraded with the most recent modifications and guarantee that your filings abide by the most existing standards. They can likewise offer ongoing assistance if the internal revenue service requests additional information or carries out an audit related to your ERC claim.
It’s important to research and vet any business using ERC filing help to guarantee their credibility and expertise. Look for established firms with experience in tax and payroll services, or think about connecting to relied on accounting firms or tax professionals who provide ERC submitting assistance.
Keep in mind that while these companies can offer important support, it’s constantly a good concept to have a fundamental understanding of the ERC requirements and process yourself. This will help you make notified decisions and guarantee accurate filings.
The Employee Retention Credit (ERC) is a refundable tax credit presented by the U.S. federal government as part of COVID-19 relief procedures. The objective of the ERC is to encourage companies to maintain and pay their employees during the pandemic, even if their operations have actually been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is offered to qualified employers, including for-profit organizations, tax-exempt organizations, and certain governmental entities. To qualify, employers should meet one of two requirements:.
Business operations were completely or partly suspended due to a federal government order related to COVID-19.
The business experienced a substantial decrease in gross receipts. As mentioned previously, for 2021, a significant decrease is defined as a 20% decline in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a significant decline is specified 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 instantly preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit amount amounts to a percentage (approximately 70%) of qualified earnings paid to workers, including 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, services that got an Income Defense Program (PPP) loan were not qualified for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 enables organizations to declare the ERC even if they received a PPP loan. The exact same incomes can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively broadened and enhanced, allowing qualified employers to declare the credit for certified salaries paid as far back as March 13, 2020. This retroactive provision supplies an opportunity for services to amend prior-year tax returns and receive refunds.
Declaring the Credit: Employers can declare the ERC by reporting it on their work tax returns, normally Form 941. The excess can be refunded to the employer if the credit exceeds the amount of work taxes owed.
It is very important to note that the ERC provisions and eligibility requirements have actually developed with time. The very best strategy is to speak with a tax professional or check out the official internal revenue service site for the most detailed and updated info concerning the ERC, including any current legal modifications or updates.
To qualify for the ERC, a company needs to fulfill one of the following requirements:.
The business operations were fully or partly suspended due to a government order related to COVID-19.
The business experienced a substantial decline in gross receipts. 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 significant decline 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 available to businesses of all sizes, consisting of tax-exempt organizations, but there are some exceptions. For instance, government entities and companies that got a PPP loan may have restrictions on claiming the credit.
The process for declaring the ERC includes completing the required forms and including the credit on your employment income tax return (typically Form 941). The exact time it takes to process the credit can vary based upon a number of aspects, including the complexity of your service and the workload of the internal revenue service. It’s suggested to speak with a tax professional for guidance particular to your circumstance.
There are numerous business that can assist with the process of claiming the ERC. Some popular business that offer assistance with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the information offered here is based upon basic understanding and may not reflect the most recent updates or modifications to the ERC. It is very important to seek advice from a tax professional or visit the main internal revenue service website for the most up-to-date and precise info regarding eligibility, claiming treatments, and readily available support.
Less than 100. If the employer had 100 or fewer staff members on average in 2019, then the credit is based.
on incomes paid to all workers whether they actually worked or not. Simply put, even if the.
employees worked full-time and made money for full-time work, the company still gets the credit.
Greater than 100. The credit is if the employer had more than 100 staff members on average in 2019.
enabled only for earnings paid to staff members who did not work during the calendar quarter.
In both cases, “salaries” includes not just money payments but likewise a portion of the expense of employer.
offered healthcare. Payroll Tax Deferral And Employee Retention Credit
Companies can be immediately repaid for the credit by reducing the amount of payroll taxes they.