Lets talk first about Qbi Wages And Employee Retention Credit :
Our group here what do these people doing everyone in this room is assisting teach people about ERC and uh constantly provide a beautiful breakfast and have people really learn about the program we should head to the space where we are able to show a few of the checks that we are getting for business and I want to see that what is this this is uh numerous countless dollars actually Kevin hundreds of countless dollars so these are replicate copies of the letters that go to clients verifying that the check is on the way I mean you understand 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 imply think of how many actual clients 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 confirmed and the check is on the mail in the mail from the internal revenue service heading to the customer so that’s how you have the ability to track it you know when you
get this you know the check is opted for sure which’s when they pay so they do not pay anything up until they really receive the cash they don’t pay bottom line Wonder trust anything until this letter is verified the check is on the method they transfer it into their bank account and they can truly trust Wonder trust that the process has been ended up and the number of you believe you’ve processed because you started this we have to do with 35 000 of these for
about six billion dollars wow so plainly they know what they’re doing which’s what you require 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 Fantastic here you’re at my YouTube channel we’re speaking about something truly essential today the staff member retention credit which the majority of you have actually never ever heard of I certainly had not heard of it until extremely just recently and found out a lot about it because this is probably the most affordable expense of capital for any small business anywhere
anytime if you have employees in between five and five hundred so I have actually got the professional with me this is Josh Fox he’s the founder and CEO of bottom line Concepts they’re the largest processor of these ERC credits this is a 170 page program so it’s not easy this isn’t like PPP we just call your bank supervisor and state give me a loan it doesn’t 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 have actually ended up being yes the Ambassador and paid spokesperson for this I love this program it’s disappearing soon you got to discover all about it let’s talk employee retention credit Josh Fox what is an ERC let’s just start there so throughout the Trump Administration when President Trump was enacted they developed the cares Act and the cares act offered companies 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 2 of them are loans and one’s a refund precisely so the ERC is a refund that’s.
correct the money cash payroll tax refund okay go on sorry I just have to make sure we got that point I imply that’s a big distinction a loan versus cash money I like money cash that’s what we’re discussing 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 initial cares Act is the ERC and yes Kevin it is a beautiful tough check in the mail where you get actual money from the IRS all right so let’s talk about how it works since it sounds like to me if it’s a if it’s employee retention credit that person had to be a staff member so I’m going to make the Presumption this money is not for the owner not for individuals on the cap table not for shareholders it’s for employees right you had to have actually owned an organization but it’s based on you having W-2 staff members 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 six quarters the program was open well walk us through the 6 quarters so you had quarters 2 3 and 4 of 2020 and you had quarters one 2 and three of 2021. fine so that’s how it’s determined you have to be on the W-2 during that period now let’s talk my favorite part cash how much can you return per staff member that was on a W-2 in those six quarters so the estimation in 2020 to be specific Kevin is 50 of the employee’s wage to a maximum of five thousand dollars per worker for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the staff member’s wage to an optimum of 7 thousand per quarter how did that happen um they simply changed the rules in.
2021 versus because the chaos of the pandemic so they wished 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 happens 21 000 Max in 2021 oh that’s how you come up with twenty six thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty 6 thousand dollars per worker that is since that’s a lot of money it is now there’s a caution here the PPP cash would have to be lowered from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan two you would decrease the 26 000 so what we’re seeing usually Kevin is if you took PPP cash someplace around 10 thousand dollars a person so let’s say 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 money you would still get a million dollar in the mail from the IRS so it’s huge obviously now the big question is why does no one understand about this because appearance when I first became aware of this when I initially fulfilled Josh you know I’ve got great deals of financial investments in lots of business I’m a significant advocate for entrepreneurship in America and make many many investments in entrepreneurs of which lots of suffered through the pandemic when I initially heard about this I called BS I don’t believe it since I utilize the PPP we went through the cash center Banks to get it it was extremely 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 survive 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 political leader buddies Guv Senators they didn’t understand about it I indicate that’s how you know that’s how false information is that there’s no info out there then a bunch of people informed me well you can’t get it due to the fact that you took the PPP likewise not true so let’s ask Josh why does no one understand about the employee retention credit you know what’s interesting you’re speaking about the banks Kevin since in the PPP loan procedure the federal government made it extremely clear that if you desired a PPP loan you would call Wells Fargo Citibank Bank of America any of the big banks in our nation and they would process procedure in Canada a pre-pp loan there’s no loans in Canada by the way it’s simply procedure procedure that’s all um and here there was chaos since keep in mind in the original cares act you could not do both programs so if you had actually done PPP you might not do ERC in the initial program and when they changed the law in 2021 the banks were refraining from doing ERC because it’s not alone so you’re getting a tax refund so the federal government never ever made it clear to anyone about how to.
do this does your CFO know how to do this not really he or she’s never done it in the past 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 accounting professional no your accounting professional’s never ever done this prior to unless you have an account that entered into this organization and bottom line my company Kevin has actually stayed in business because 2009 and we have actually been working with the federal government and the state government to recuperate cash for Fortune 500 Fortune 1000 business so a great deal of our big big corporate customers have worked with bottom line to recover other government programs we’ve done sales tax and use tax joblessness tax work opportunity tax credits research and development tax credits unclaimed property property 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 as much as $10,000 in wages paid by an.
employer whose company is completely or partially suspended because of COVID-19 or whose gross receipts.
decline by more than 50%.
1. The credit is available to all employers regardless of size consisting of tax exempt companies. There are.
only two exceptions: (1) state and local governments and their instrumentalities and (2) little.
companies who take Small company Loans.
2. To qualify, the employer needs to satisfy one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the company’s service is totally or partially suspended by federal government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross invoices are below 50% of the comparable quarter in 2019. When the.
company’s gross invoices exceed 80% of an equivalent 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 qualifying earnings paid up to $10,000 in total.
It works for salaries paid after March 13th and prior to December 31, 2020.
The meaning of qualifying earnings varies by whether an employer had, typically, more or less than.
100 workers in 2019.
Companies that concentrate on ERC filing help normally provide knowledge and support to assist companies browse the complex process of claiming the credit. They can offer different services, consisting of:.
How is the employee retention credit calculated? Qbi Wages And Employee Retention Credit
Eligibility Evaluation: These business will examine your company’s eligibility for the ERC based upon elements such as your market, earnings, and operations. If you satisfy the requirements for the credit and recognize the maximum credit amount you can claim, they can help determine.
Documents and Computation: ERC filing services will help in collecting the essential documents, such as payroll records and monetary statements, to support your claim. They will likewise assist calculate the credit quantity based on eligible wages and other qualifying expenses.
Retroactive Claim Review: If you are eligible to claim the ERC for prior quarters, these business can review your previous payroll records and financials to determine possible chances for retroactive credits. They can help you modify prior tax returns to claim these refunds.
Filing Support: Companies specializing in ERC filings will prepare and send the needed forms and documentation in your place. This consists of completing Form 941 or any other necessary tax forms.
Compliance and Updates: ERC regulations and assistance have actually evolved in time. These business stay upgraded with the current modifications and ensure that your filings abide by the most existing standards. If the IRS demands extra details or performs an audit associated to your ERC claim, they can likewise provide continuous support.
It’s important to research study and veterinarian any company using ERC filing support to guarantee their reliability and proficiency. Look for recognized companies with experience in tax and payroll services, or think about reaching out to trusted accounting companies or tax professionals who provide ERC filing support.
Remember that while these business can provide valuable support, it’s always a great concept to have a basic understanding of the ERC requirements and procedure yourself. This will assist you make informed choices and ensure precise filings.
The Worker Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief procedures. The objective of the ERC is to encourage organizations to retain and pay their workers throughout the pandemic, even if their operations have actually been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is available to eligible companies, consisting of for-profit companies, tax-exempt organizations, and particular governmental entities. To certify, employers should meet one of two requirements:.
Business operations were fully or partially suspended due to a government order related to COVID-19.
Business experienced a substantial decline in gross receipts. As pointed out earlier, for 2021, a considerable decline is specified as a 20% decline in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a significant decrease is defined as a 20% decline in gross invoices compared to the same quarter in 2019, or a 20% decrease in gross invoices compared to the instantly preceding quarter.
Credit Amount: The ERC is a refundable tax credit that offsets the employer’s share of Social Security taxes. The credit quantity amounts to a percentage (approximately 70%) of qualified salaries paid to employees, 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: Initially, organizations that got an Income Protection Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 permits companies to claim the ERC even if they received a PPP loan. The very same salaries can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively expanded and boosted, allowing eligible employers to declare the credit for certified salaries paid as far back as March 13, 2020. This retroactive provision provides an opportunity for companies to change prior-year income tax return and get refunds.
Declaring the Credit: Employers can claim the ERC by reporting it on their employment tax returns, typically Kind 941. If the credit goes beyond the amount 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 criteria have evolved with time. The very best course of action is to seek advice from a tax expert or go to the official internal revenue service website for the most updated and in-depth details concerning the ERC, including any current legislative changes or updates.
To get approved for the ERC, a business should fulfill one of the following criteria:.
The business operations were completely or partially suspended due to a government order related to COVID-19.
The business experienced a considerable decline in gross invoices. For 2021, a substantial decline 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 defined as a 20% decline in gross invoices compared to the very same quarter in 2019, or a 20% decrease in gross invoices compared to the immediately preceding quarter.
The ERC is offered to companies of all sizes, including tax-exempt organizations, however there are some exceptions. Federal government entities and organizations that got a PPP loan may have limitations on claiming the credit.
The procedure for declaring the ERC includes finishing the essential kinds and including the credit on your employment income tax return (typically Kind 941). The exact time it requires to process the credit can vary based on several aspects, including the intricacy of your company and the workload of the internal revenue service. It’s suggested to speak with a tax expert for assistance particular to your scenario.
There are a number of business that can assist with the process of declaring the ERC. Some well-known business that offer help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the details offered here is based upon general knowledge and may not reflect the most current updates or changes to the ERC. It is necessary to talk to a tax expert or check out the main IRS site for the most up-to-date and precise information relating to eligibility, declaring procedures, and offered assistance.
Less than 100. If the company had 100 or fewer employees typically in 2019, then the credit is based.
on salaries paid to all staff members whether they actually worked or not. Simply put, even if the.
workers worked full-time and made money for full time work, the company still gets the credit.
Greater than 100. The credit is if the company had more than 100 workers on average in 2019.
allowed just for incomes paid to workers who did not work throughout the calendar quarter.
In both cases, “earnings” consists of not just cash payments but likewise a part of the expense of employer.
offered health care. Qbi Wages And Employee Retention Credit
Companies can be immediately compensated for the credit by reducing the amount of payroll taxes they.