Lets talk first about Quickbooks Desktop Employee Retention Credit :
Our team here what do these people doing everybody in this space is assisting teach people about ERC and uh always offer a gorgeous breakfast and have people really discover the program we must head to the room where we are able to show some of the checks that we are getting for business and I ‘d like to see that what is this this is uh hundreds of millions of dollars actually Kevin hundreds of millions of dollars so these are replicate copies of the letters that go to customers validating that the check is on the way I imply you understand if you simply begin to 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 mean it’s simply I suggest 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 verified the numbers are confirmed and the check is on the mail in the mail from the internal revenue service heading to the client so that’s how you’re able to track it you understand when you
receive this you understand the check is chosen sure which’s when they pay so they do not pay anything up until they really receive the money 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 genuinely trust Wonder trust that the process has actually been completed and how many you believe you’ve processed considering that you began 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 discussing something really crucial today the staff member retention credit which the majority of you have actually never ever heard of I certainly hadn’t become aware of it till extremely recently and learned 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 specialist 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 difficult this isn’t like PPP we simply call your bank manager and say offer me a loan it does not work there’s not a loan it’s an application and Josh is going to inform us all about it and how to get it and why I’ve ended up being yes the Ambassador and paid representative for this I enjoy this program it’s disappearing soon you got to find out everything about it let’s talk employee retention credit Josh Fox what is an ERC let’s just begin there so throughout the Trump Administration when President Trump was enacted they created the cares Act and the cares act offered services 3 chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly everybody it makes a big distinction right there two of them are loans and one’s a refund exactly so the ERC is a refund that’s.
fix the cash money payroll tax refund fine go on sorry I simply need to make sure we got that point I suggest that’s a huge distinction a loan versus money money I like cash cash that’s what we’re talking 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 actual money from the internal revenue service all right so let’s talk about how it works due to the fact that it sounds like to me if it’s a if it’s worker retention credit that individual had to be a worker 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 employees right you needed to have actually owned a company however it’s based on 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 qualified 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 six quarters so you had quarters two 3 and 4 of 2020 and you had quarters one 2 and three of 2021. alright so that’s how it’s measured you have to be on the W-2 throughout that duration now let’s talk my preferred part cash how much can you get back per worker that was on a W-2 in those 6 quarters so the computation in 2020 to be specific Kevin is 50 of the employee’s income to a maximum of 5 thousand dollars per worker for the year of 2020 and in 2021 the numbers escalated to 70 of the staff member’s salary to a maximum of 7 thousand per quarter how did that take place um they just 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 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 5 thousand in twenty twenty that’s twenty six thousand dollars per worker that is since that’s a lot of cash it is now there’s a caution here the PPP cash would have to be lowered from the twenty six thousand dollars so if you took PPP loan one and PPP loan two you would reduce the 26 000 so what we’re seeing on average Kevin is if you took PPP money someplace around 10 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 employees and you took PPP cash you would still get a million dollar in the mail from the IRS so it’s huge undoubtedly now the big question is why does nobody learn about this due to the fact that appearance when I initially became aware of this when I first met Josh you understand I have actually got lots of financial investments in lots of business I’m a major advocate for entrepreneurship in America and make numerous many investments in business owners of which lots of suffered through the pandemic when I initially found out about this I called BS I don’t believe it due to the fact that I utilize 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 and that were well deserved and we used them sensibly 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 called to my political leader buddies Guv Senators they didn’t learn about it I indicate that’s how you know that’s how misinformation is that there’s no info out there then a bunch of people told me well you can’t get it since you took the PPP likewise not true so let’s ask Josh why does nobody understand about the employee retention credit you know what’s interesting you’re speaking about the banks Kevin due to the fact that in the PPP loan process 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 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 simply process procedure that’s all um and here there was chaos due to the fact that remember in the original cares act you might not do both programs so if you had actually done PPP you could not do ERC in the initial program and when they changed the law in 2021 the banks were refraining from doing ERC since it’s not alone so you’re getting a tax refund so the federal government never made it clear to any person about how to.
do this does your CFO understand how to do this not really she or he’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 company your accounting professional no your accountant’s never ever done this before unless you have an account that entered into this service and bottom line my firm Kevin has actually stayed in business given that 2009 and we’ve been working with the federal government and the state federal government to recover cash for Fortune 500 Fortune 1000 business so a great deal of our huge huge corporate clients have worked with bottom line to recuperate other federal government programs we’ve done sales tax and use tax joblessness tax work opportunity tax credits research and development tax credits unclaimed home property tax all of these other federal government programs.
The employee retention tax credit is a broad based refundable tax credit created to encourage.
employers to keep staff members on their payroll. The credit is 50% of as much as $10,000 in incomes paid by an.
Because of COVID-19 or whose gross receipts, employer whose company is totally or partly suspended.
decrease by more than 50%.
1. The credit is offered to all employers despite size including tax exempt companies. There are.
only 2 exceptions: (1) state and city governments and their instrumentalities and (2) small.
services who take Small Business Loans.
2. To certify, the company needs to meet one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the company’s organization is totally or partly suspended by government order due to COVID-19.
during the calendar quarter or.
o the company’s gross receipts are below 50% of the equivalent quarter in 2019. As soon as the.
employer’s gross invoices go above 80% of a similar 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 earnings paid up to $10,000 in overall.
It is effective for wages paid after March 13th and prior to December 31, 2020.
The meaning of certifying wages varies by whether an employer had, usually, basically than.
100 employees in 2019.
Companies that specialize in ERC filing support normally supply proficiency and support to assist services navigate the complex process of declaring the credit. They can offer different services, including:.
How is the employee retention credit calculated? Quickbooks Desktop Employee Retention Credit
Eligibility Assessment: These business will assess your company’s eligibility for the ERC based upon factors such as your market, earnings, and operations. They can assist determine if you meet the requirements for the credit and recognize the maximum credit amount you can declare.
Documentation and Estimation: ERC filing services will assist in gathering the needed documents, such as payroll records and financial declarations, to support your claim. They will also assist calculate the credit quantity based on eligible incomes and other certifying costs.
Retroactive Claim Review: If you are qualified to declare the ERC for previous quarters, these business can examine your previous payroll records and financials to recognize prospective opportunities for retroactive credits. They can assist you change previous income tax return to claim these refunds.
Filing Help: Business specializing in ERC filings will prepare and submit the needed forms and documentation in your place. This consists of finishing Type 941 or any other required tax return.
Compliance and Updates: ERC guidelines and guidance have progressed over time. These companies stay updated with the latest changes and ensure that your filings adhere to the most existing standards. If the Internal revenue service demands extra information or conducts an audit associated to your ERC claim, they can likewise provide ongoing support.
It is necessary to research and veterinarian any business providing ERC filing help to ensure their reliability and competence. Look for established companies with experience in tax and payroll services, or consider reaching out to trusted accounting companies or tax specialists who offer ERC filing support.
Bear in mind that while these companies can supply valuable help, it’s always a good concept 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. federal government as part of COVID-19 relief procedures. The goal of the ERC is to encourage services to keep and pay their employees throughout the pandemic, even if their operations have 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 companies, and certain governmental entities. To certify, companies should fulfill one of two criteria:.
Business operations were completely or partly suspended due to a federal government order related to COVID-19.
Business experienced a considerable decrease in gross invoices. As mentioned earlier, for 2021, a considerable decline is defined as a 20% decrease in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a considerable decrease is defined as a 20% decrease in gross invoices compared to the same quarter in 2019, or a 20% decrease in gross receipts compared to the instantly preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the employer’s share of Social Security taxes. The credit amount is equal to a portion (up to 70%) of qualified incomes paid to workers, consisting of specific health plan expenses. 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, services that got an Income Protection Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 enables organizations to declare the ERC even if they got a PPP loan. The same earnings 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 companies to declare the credit for certified earnings paid as far back as March 13, 2020. This retroactive arrangement provides an opportunity for services to change prior-year tax returns and receive refunds.
Declaring the Credit: Employers can declare the ERC by reporting it on their work tax returns, usually Kind 941. The excess can be refunded to the employer if the credit surpasses the quantity of work taxes owed.
It is necessary to note that the ERC provisions and eligibility requirements have evolved over time. The very best strategy is to talk to a tax professional or visit the official IRS site for the most in-depth and up-to-date details regarding the ERC, consisting of any current legislative modifications or updates.
To get approved for the ERC, an organization must satisfy among the following requirements:.
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 decline is specified as a 20% decline in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a substantial decrease is defined as a 20% decline in gross receipts compared to the same quarter in 2019, or a 20% decline in gross receipts compared to the instantly preceding quarter.
The ERC is available to organizations of all sizes, consisting of tax-exempt organizations, however there are some exceptions. For example, federal government entities and businesses that got a PPP loan may have restrictions on claiming the credit.
The procedure for declaring the ERC involves completing the needed types and consisting of the credit on your employment income tax return (typically Form 941). The exact time it requires to process the credit can vary based on several factors, including the intricacy of your service and the workload of the IRS. It’s suggested to seek advice from a tax professional for guidance particular to your scenario.
There are a number of business that can assist with the procedure of declaring the ERC. Some popular companies that provide assistance with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the info offered here is based on general knowledge and may not reflect the most current updates or changes to the ERC. It is very important to seek advice from a tax professional or visit the main IRS site for the most precise and current info relating to eligibility, claiming treatments, and readily available assistance.
Less than 100. If the employer had 100 or less employees typically in 2019, then the credit is based.
on wages paid to all staff members whether they in fact worked or not. In other words, even if the.
staff members worked full time and got paid for full time work, the company still gets the credit.
Greater than 100. If the company had more than 100 staff members typically in 2019, then the credit is.
allowed only for incomes paid to employees who did not work during the calendar quarter.
In both cases, “incomes” consists of not just money payments however likewise a portion of the expense of employer.
offered healthcare. Quickbooks Desktop Employee Retention Credit
Companies can be instantly repaid for the credit by minimizing the quantity of payroll taxes they.