Lets talk first about Quickbooks Employee Retention Credit :
Our team here what do these people doing everyone in this space is helping teach people about ERC and uh always provide a stunning breakfast and have individuals actually learn about the program we should head to the room where we are able to show a few of the checks that we are getting for companies and I ‘d like to see that what is this this is uh numerous countless dollars actually Kevin numerous countless dollars so these are replicate copies of the letters that go to customers verifying that the check is on the method I imply you understand if you simply begin to take a look at a few 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 the number of actual clients that went through the program yeah this is the very end this is the celebration at the end when the check is confirmed the numbers are validated and the check is on the mail in the mail from the internal revenue service heading to the client so that’s how you have the ability to track it you understand when you
receive this you understand the check is opted for sure which’s when they pay so they do not pay anything up until they actually get the money they don’t pay bottom line Wonder trust anything till this letter is validated the check is on the method they transfer it into their checking account and they can really rely on Wonder trust that the process has been finished and how many you think you have actually processed considering that you started this we have to do with 35 000 of these for
about six billion dollars wow so clearly they understand what they’re doing which’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 Terrific here you’re at my YouTube channel we’re speaking about something truly crucial today the employee retention credit which the majority of you have actually never ever heard of I definitely had not become aware of it up until really just recently and discovered a lot about it since this is probably the lowest cost of capital for any small company anywhere
anytime if you have staff members in between five and five hundred so I’ve got the professional with me this is Josh Fox he’s the founder and CEO of bottom line Principles 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 simply contact your bank manager and state provide me a loan it does not 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 ended up being yes the Ambassador and paid spokesperson for this I like this program it’s disappearing soon you got to find out all about it let’s talk staff member 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 used companies 3 opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically everybody it makes a huge difference right there 2 of them are loans and one’s a refund exactly so the ERC is a refund that’s.
remedy the cash money payroll tax refund fine go on sorry I simply have to make certain we got that point I mean that’s a big difference a loan versus cash cash I like cash cash that’s what we’re speaking about fine 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 hard check in the mail where you get real cash from the IRS all right so let’s talk 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 person needed to be an employee so I’m going to make the Presumption this money is not for the owner not for people on the cap table not for shareholders it’s for workers right you had to have 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 employees 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 6 quarters the program was open well walk us through the 6 quarters so you had quarters two three 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 throughout 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 calculation in 2020 to be exact Kevin is 50 of the worker’s salary to an optimum of five thousand dollars per employee for the year of 2020 and in 2021 the numbers escalated to 70 of the worker’s wage to an optimum of 7 thousand per quarter how did that take place um they simply altered the rules in.
2021 versus because the chaos 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 as much as five thousand Max and after that what takes place 21 000 Max in 2021 oh that’s how you develop twenty 6 thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty six thousand dollars per employee that is because that’s a lot of money it is now there’s a caveat here the PPP money would have to be lowered from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan two you would reduce the 26 000 so what we’re seeing typically Kevin is if you took PPP money someplace 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 big clearly now the huge question is why does nobody learn about this because appearance when I initially became aware of this when I initially fulfilled Josh you understand I have actually got great deals of investments in great deals of business I’m a major supporter for entrepreneurship in America and make many many investments in business owners of which numerous suffered through the pandemic when I initially heard about this I called BS I don’t believe it due to the fact that I use the PPP we went through the money 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 should have and we utilized 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 politician buddies Governor Senators they didn’t understand about it I suggest that’s how you understand that’s how misinformation is that there’s no information out there then a lot of people informed me well you can’t get it because you took the PPP also not true so let’s ask Josh why does no one know about the worker retention credit you understand what’s intriguing you’re talking about the banks Kevin since in the PPP loan procedure the federal government made it really 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 process process that’s all um and here there was turmoil since remember in the original cares act you might refrain from doing both programs so if you had done PPP you might 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 federal government never ever made it clear to anybody about how to.
do this does your CFO know 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 company your accounting professional no your accountant’s never done this before unless you have an account that went into this company and bottom line my firm Kevin has actually stayed in business given that 2009 and we have actually been dealing with the federal government and the state government to recover money for Fortune 500 Fortune 1000 companies so a lot of our huge huge corporate clients have actually worked with bottom line to recuperate other federal government programs we have actually done sales tax and use tax unemployment tax work chance tax credits research and development tax credits unclaimed property property tax all of these other government programs.
The employee retention tax credit is a broad based refundable tax credit designed to encourage.
employers to keep employees on their payroll. The credit is 50% of up to $10,000 in salaries paid by an.
company whose organization is totally or partly suspended because of COVID-19 or whose gross receipts.
decline by more than 50%.
1. The credit is readily available to all companies no matter size including tax exempt companies. There are.
just 2 exceptions: (1) state and local governments and their instrumentalities and (2) small.
companies who take Small Business Loans.
2. To certify, the employer has to fulfill one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the company’s organization is completely or partially suspended by government order due to COVID-19.
during the calendar quarter or.
o the company’s gross invoices are listed below 50% of the equivalent quarter in 2019. As soon as the.
company’s gross receipts exceed 80% of a comparable 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 certifying wages paid up to $10,000 in overall.
It is effective for incomes paid after March 13th and before December 31, 2020.
The definition of qualifying incomes varies by whether an employer had, usually, more or less than.
100 employees in 2019.
Companies that concentrate on ERC filing assistance typically offer proficiency and support to assist companies navigate the intricate process of claiming the credit. They can provide numerous services, consisting of:.
How is the employee retention credit calculated? Quickbooks Employee Retention Credit
Eligibility Evaluation: These companies will assess your organization’s eligibility for the ERC based on elements such as your industry, profits, and operations. They can assist figure out if you meet the requirements for the credit and identify the maximum credit amount you can claim.
Documentation and Estimation: ERC filing services will help in collecting the essential documentation, such as payroll records and monetary statements, to support your claim. They will also assist determine the credit quantity based on qualified incomes and other certifying costs.
Retroactive Claim Evaluation: If you are qualified to declare the ERC for previous quarters, these business can review your previous payroll records and financials to identify potential chances for retroactive credits. They can help you amend prior tax returns to claim these refunds.
Filing Assistance: Companies specializing in ERC filings will prepare and submit the required kinds and documents in your place. This includes completing Kind 941 or any other required tax forms.
Compliance and Updates: ERC guidelines and guidance have actually progressed gradually. These business remain upgraded with the latest modifications and ensure that your filings adhere to the most existing standards. If the Internal revenue service requests additional info or performs an audit related to your ERC claim, they can likewise offer ongoing assistance.
It’s important to research and veterinarian any company using ERC filing help to guarantee their trustworthiness and proficiency. Try to find recognized firms with experience in tax and payroll services, or think about reaching out to relied on accounting firms or tax professionals who offer ERC filing assistance.
Bear in mind that while these business can offer valuable assistance, it’s always an excellent idea to have a basic understanding of the ERC requirements and process yourself. This will assist you make informed choices and guarantee accurate filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit presented by the U.S. federal government as part of COVID-19 relief measures. The objective of the ERC is to motivate services to retain and pay their staff members during the pandemic, even if their operations have been impacted.
Here are some key points about the ERC:.
Eligibility: The ERC is offered to eligible employers, consisting of for-profit organizations, tax-exempt companies, and certain governmental entities. To qualify, companies must fulfill one of two requirements:.
Business operations were fully or partially suspended due to a federal government order related to COVID-19.
Business experienced a significant decrease in gross receipts. As pointed out previously, for 2021, a significant decrease is specified 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% decrease in gross receipts compared to the 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 amount amounts to a portion (as much as 70%) of certified earnings paid to employees, including specific health plan expenditures. The optimum 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 a Paycheck Security 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 got a PPP loan. However, the exact same wages can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively broadened and improved, enabling eligible employers to declare the credit for qualified earnings paid as far back as March 13, 2020. This retroactive arrangement provides a chance for companies to change prior-year tax returns and get refunds.
Declaring the Credit: Employers can claim the ERC by reporting it on their work tax returns, generally Kind 941. The excess can be refunded to the company if the credit goes beyond the quantity of employment taxes owed.
It is very important to note that the ERC provisions and eligibility criteria have actually evolved with time. The very best strategy is to talk to a tax expert or go to the official internal revenue service website for the most comprehensive and current details regarding the ERC, including any current legal changes or updates.
To qualify for the ERC, an organization needs to meet among the following criteria:.
Business operations were completely or partly suspended due to a government order related to COVID-19.
The business experienced a considerable decrease in gross receipts. For 2021, a substantial decrease is specified as a 20% decrease in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a considerable decrease is defined as a 20% decline in gross invoices compared to the same quarter in 2019, or a 20% decrease in gross receipts compared to the immediately preceding quarter.
The ERC is readily available to businesses of all sizes, including tax-exempt companies, but there are some exceptions. Federal government entities and services that got a PPP loan may have restrictions on claiming the credit.
The process for declaring the ERC includes finishing the needed types and consisting of the credit on your work income tax return (normally Kind 941). The exact time it requires to process the credit can vary based upon several aspects, including the intricacy of your service and the work of the internal revenue service. It’s recommended to consult with a tax professional for assistance particular to your circumstance.
There are several companies that can help with the process of claiming the ERC. Some widely known companies that offer assistance with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the info offered here is based upon basic understanding and may not show the most recent updates or changes to the ERC. It’s important to seek advice from a tax professional or go to the main IRS website for the most precise and current details concerning eligibility, claiming treatments, and readily available help.
Less than 100. The credit is based if the company had 100 or less staff members on average in 2019.
on earnings paid to all workers whether they really worked or not. To put it simply, 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 staff members on average in 2019.
enabled only for wages paid to staff members who did not work throughout the calendar quarter.
In both cases, “earnings” includes not simply money payments but also a portion of the cost of employer.
offered health care. Quickbooks Employee Retention Credit
Employers can be immediately repaid for the credit by minimizing the amount of payroll taxes they.