Lets talk first about Qualified Wages For Employee Retention Credit 2021 :
Our team here what do these guys doing everybody in this space is assisting teach people about ERC and uh always provide a lovely breakfast and have people really find out about the program we should head to the space where we have the ability to display some of the checks that we are getting for companies and I ‘d like to see that what is this this is uh hundreds of millions of dollars literally Kevin numerous countless dollars so these are replicate copies of the letters that go to clients confirming that the check is on the method I suggest you know if you just begin to take a look at some of these here I mean this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I imply it’s just I suggest think about the number of actual customers that went through the program yeah this is the very end this is the party at the end when the check is verified the numbers are verified 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 up until they actually receive the cash they do not pay bottom line Wonder trust anything till this letter is confirmed the check is on the method they transfer it into their checking account and they can really trust Wonder trust that the procedure has been finished and how many you believe you have actually processed considering that you began this we have to do with 35 000 of these for
about six billion dollars wow so clearly they know what they’re doing which’s what you need 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 Terrific here you’re at my YouTube channel we’re speaking about something truly important today the worker 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 discovered a lot about it because this is most likely the lowest cost of capital for any small business anywhere
anytime if you have workers between 5 and five hundred so I’ve got the expert with me this is Josh Fox he’s the creator and CEO of bottom line Concepts they’re the biggest processor of these ERC credits this is a 170 page program so it’s hard this isn’t like PPP we simply call up your bank supervisor and say offer 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 have actually become yes the Ambassador and paid spokesperson for this I love this program it’s going away soon you got to learn everything about it let’s talk staff member 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 offered organizations three chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically everybody it makes a huge distinction right there 2 of them are loans and one’s a refund precisely so the ERC is a refund that’s.
correct the money money payroll tax refund all right go on sorry I just have to make certain we got that point I suggest that’s a big difference a loan versus money cash I like cash 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 stunning tough check in the mail where you get real cash from the internal revenue service 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 staff member retention credit that individual needed 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 workers right you had to have owned a service however 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 eligible so you have to be on payroll in 2020 on the W-2 and you have to be on payroll for the first six months of 2021 on the W-2 proper so there were 6 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 two and 3 of 2021. all right so that’s how it’s measured you need to be on the W-2 during that period now let’s talk my favorite part money just how much can you return per employee that was on a W-2 in those 6 quarters so the estimation in 2020 to be precise Kevin is 50 of the worker’s income 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 salary to a maximum of 7 thousand per quarter how did that take place um they simply altered the rules in.
2021 versus because 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 up to 5 thousand Max and after that what happens 21 000 Max in 2021 oh that’s how you come up with twenty 6 thousand twenty one thousand to twenty twenty one plus five thousand in twenty twenty that’s twenty 6 thousand dollars per staff member that is since that’s a great deal of cash it is now there’s a caution here the PPP cash would need to be reduced from the twenty six thousand dollars so if you took PPP loan one and PPP loan two you would lower the 26 000 so what we’re seeing typically Kevin is if you took PPP cash somewhere around 10 thousand dollars an individual so let’s say hypothetically you owned a restaurant in New York City where I’m from and you had a hundred employees and you took PPP money you would still get a million dollar in the mail from the internal revenue service so it’s big certainly now the huge concern is why does nobody understand about this due to the fact that appearance when I initially heard about this when I first met Josh you know I’ve got great deals of financial investments in lots of companies I’m a major supporter for entrepreneurship in America and make numerous numerous investments in entrepreneurs of which lots of suffered through the pandemic when I first became aware of this I called BS I don’t think it because I use 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 been worthy of and we used them carefully to survive throughout the pandemic so when I became aware of this I said nah it can’t be true however when I dug around I even contacted us to my political leader good friends Guv Senators they didn’t understand about it I suggest 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 since you took the PPP also not true so let’s ask Josh why does no one learn about the worker retention credit you understand what’s intriguing you’re speaking about the banks Kevin because 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 process in Canada a pre-pp loan there’s no loans in Canada by the way it’s just procedure process that’s all um and here there was mayhem since keep in mind in the initial cares act you might not do both programs so if you had done PPP you could 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 government never made it clear to any person about how to.
do this does your CFO know how to do this not actually she or he’s never ever done it previously do the banks do it nope the banks do not do it the payroll companies yeah some of them are doing it as a payroll business your accountant no your accountant’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 been in business since 2009 and we’ve been dealing with the federal government and the state federal government to recuperate cash for Fortune 500 Fortune 1000 business so a lot of our huge big business customers have actually dealt with bottom line to recover other government programs we have actually done sales tax and utilize tax joblessness tax work opportunity tax credits research and development tax credits unclaimed home real estate tax all of these other government programs.
The staff member retention tax credit is a broad based refundable tax credit developed to encourage.
employers to keep employees on their payroll. The credit is 50% of up to $10,000 in earnings paid by an.
Due to the fact that of COVID-19 or whose gross invoices, company whose organization is completely or partially suspended.
decline by more than 50%.
1. The credit is readily available to all employers no matter size consisting of tax exempt companies. There are.
just 2 exceptions: (1) state and local governments and their instrumentalities and (2) small.
businesses who take Small company Loans.
2. To certify, the employer needs to satisfy one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the employer’s company is fully or partially suspended by federal government order due to COVID-19.
during the calendar quarter or.
o the employer’s gross receipts are below 50% of the equivalent quarter in 2019. As soon as the.
employer’s gross receipts exceed 80% of a comparable quarter in 2019 they no longer certify.
after the end of that quarter.
Calculation of the Credit.
The quantity of the credit is 50% of the qualifying wages paid up to $10,000 in overall.
It is effective for salaries paid after March 13th and prior to December 31, 2020.
The meaning of qualifying wages varies by whether a company had, typically, more or less than.
100 workers in 2019.
Companies that concentrate on ERC filing assistance typically supply proficiency and assistance to help companies browse the complicated process of declaring the credit. They can offer numerous services, including:.
How is the employee retention credit calculated? Qualified Wages For Employee Retention Credit 2021
Eligibility Assessment: These business will examine your service’s eligibility for the ERC based on aspects such as your market, revenue, and operations. They can assist figure out if you fulfill the requirements for the credit and determine the optimum credit amount you can claim.
Documentation and Computation: ERC filing services will assist in collecting the required documentation, such as payroll records and financial statements, to support your claim. They will also assist determine the credit amount based upon qualified wages and other qualifying costs.
Retroactive Claim Review: If you are qualified to declare the ERC for previous quarters, these business can examine your past payroll records and financials to determine possible chances for retroactive credits. They can assist you change prior tax returns to declare these refunds.
Filing Assistance: Companies specializing in ERC filings will prepare and send the needed kinds and documentation in your place. This consists of completing Form 941 or any other necessary tax return.
Compliance and Updates: ERC guidelines and assistance have evolved gradually. These companies stay upgraded with the latest changes and ensure that your filings comply with the most present guidelines. If the IRS demands extra details or carries out an audit related to your ERC claim, they can likewise provide continuous assistance.
It is very important to research study and veterinarian any business offering ERC filing assistance to ensure their credibility and competence. Look for established companies with experience in tax and payroll services, or think about reaching out to relied on accounting companies or tax specialists who offer ERC submitting support.
Remember that while these business can supply valuable support, it’s always a good idea to have a fundamental understanding of the ERC requirements and procedure yourself. This will help you make informed decisions and guarantee accurate filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief steps. The objective of the ERC is to motivate companies to keep 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 offered to eligible employers, including for-profit services, tax-exempt organizations, and specific governmental entities. To certify, companies need to fulfill one of two requirements:.
The business operations were completely or partly suspended due to a government order related to COVID-19.
Business experienced a considerable decline in gross receipts. As discussed previously, for 2021, a substantial decrease is specified as a 20% decline in gross invoices compared to the 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% decrease in gross invoices 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 quantity amounts to a portion (up to 70%) of qualified salaries paid to employees, consisting of particular health insurance expenditures. The optimum credit per employee is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, businesses that received an Income Defense Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 permits services to claim the ERC even if they got a PPP loan. Nevertheless, the exact 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 enhanced, allowing eligible employers to claim the credit for qualified salaries paid as far back as March 13, 2020. This retroactive arrangement provides an opportunity for organizations to modify prior-year income tax return and get refunds.
Claiming the Credit: Employers can claim the ERC by reporting it on their employment income tax return, usually Type 941. The excess can be refunded to the employer if the credit surpasses the amount of employment taxes owed.
It’s important to note that the ERC provisions and eligibility criteria have progressed with time. The very best course of action is to speak with a tax expert or go to the official internal revenue service website for the most current and in-depth details concerning the ERC, including any recent legislative modifications or updates.
To get approved for the ERC, a service should meet among the following criteria:.
Business operations were completely or partially suspended due to a federal government order related to COVID-19.
The business experienced a significant decrease in gross receipts. For 2021, a substantial decrease is defined as a 20% decrease in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a considerable decrease is defined as a 20% decrease in gross receipts compared to the same quarter in 2019, or a 20% decline in gross invoices compared to the instantly preceding quarter.
The ERC is available to services of all sizes, including tax-exempt organizations, however there are some exceptions. Federal government entities and businesses that got a PPP loan might have constraints on declaring the credit.
The procedure for claiming the ERC includes finishing the required forms and including the credit on your employment tax return (usually Type 941). The exact time it requires to process the credit can differ based on numerous aspects, consisting of the complexity of your organization and the work of the IRS. It’s suggested to speak with a tax expert for assistance specific to your scenario.
There are numerous business that can assist with the procedure of declaring the ERC. Some popular business that provide support with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the info offered here is based on basic understanding and might not show the most recent updates or modifications to the ERC. It’s important to talk to a tax professional or visit the official internal revenue service website for the most accurate and current information relating to eligibility, claiming procedures, and offered help.
Less than 100. If the employer had 100 or less staff members typically in 2019, then the credit is based.
on wages paid to all employees whether they really worked or not. To put it simply, even if the.
staff members 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 on average in 2019, then the credit is.
allowed only for earnings paid to workers who did not work throughout the calendar quarter.
In both cases, “incomes” includes not just cash payments but also a portion of the expense of employer.
offered health care. Qualified Wages For Employee Retention Credit 2021
Employers can be immediately repaid for the credit by decreasing the amount of payroll taxes they.