Lets talk first about Shareholder Wages Employee Retention Credit :
Our team here what do these men doing everybody in this room is assisting teach individuals about ERC and uh constantly supply a beautiful breakfast and have people actually discover the program we need to head to the space where we have the ability to display some of the checks that we are getting for companies and I wish to see that what is this this is uh hundreds of countless dollars actually Kevin numerous millions of dollars so these are replicate copies of the letters that go to clients verifying that the check is on the method I indicate you understand if you simply begin to take a look at a few of these here I imply this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I suggest it’s simply I imply think of the number of real 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 verified and the check is on the mail in the mail from the IRS heading to the client so that’s how you’re able to track it you know when you
receive this you know the check is chosen sure and that’s when they pay so they do not pay anything until they in fact get the cash they do not pay bottom line Wonder trust anything till this letter is confirmed the check is on the method they deposit it into their savings account and they can really rely on Wonder trust that the process has actually been ended up and the number of you believe you have actually processed given that you began 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 one of these that’s what matters all right Mr Terrific here you’re at my YouTube channel we’re discussing something actually important today the staff member retention credit which the majority of you have actually never ever become aware of I certainly had not become aware of it until really recently and found out a lot about it due to the fact that this is most likely the most affordable expense of capital for any small business anywhere
anytime if you have workers between five and five hundred so I have actually got the expert with me this is Josh Fox he’s the creator 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 contact your bank supervisor and state 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 have actually become yes the Ambassador and paid spokesperson for this I love this program it’s going away very 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 throughout the Trump Administration when President Trump was enacted they came up with the cares Act and the cares act offered services 3 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 distinction right there two of them are loans and one’s a refund precisely so the ERC is a refund that’s.
fix the money money payroll tax refund all right go on sorry I simply need to make sure we got that point I indicate that’s a huge distinction a loan versus cash cash I like money money that’s what we’re talking 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 original cares Act is the ERC and yes Kevin it is a stunning hard check in the mail where you get real money from the IRS all right so let’s discuss how it works since it sounds like to me if it’s a if it’s worker retention credit that person had to be a staff member so I’m going to make the Presumption this cash is not for the owner not for people on the cap table not for shareholders it’s for staff members right you had to have actually owned a business however it’s based upon you having W-2 employees 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 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 right so there were six quarters the program was open well stroll us through the 6 quarters so you had quarters 2 3 and 4 of 2020 and you had quarters one two and three of 2021. okay 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 worker that was on a W-2 in those six quarters so the calculation in 2020 to be specific Kevin is 50 of the employee’s wage to an optimum of 5 thousand dollars per staff member for the year of 2020 and in 2021 the numbers escalated to 70 of the employee’s salary to a maximum of seven thousand per quarter how did that happen um they just altered the rules in.
2021 versus since 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 five thousand Max and then 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 five thousand in twenty twenty that’s twenty 6 thousand dollars per worker that is because that’s a lot of money it is now there’s a caveat here the PPP cash would have 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 someplace around 10 thousand dollars a person so let’s state 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 money you would still get a million dollar in the mail from the IRS so it’s substantial obviously now the big concern is why does no one understand about this since look when I first found out about this when I first fulfilled Josh you know I’ve got lots of financial investments in lots of companies I’m a major supporter for entrepreneurship in America and make many numerous financial investments in business owners of which many suffered through the pandemic when I first found out about this I called BS I don’t believe it because I use the PPP we went through the money center Banks to get it it was really easy to do we had our CEOs call the banks they got their loans which were well been worthy of and we used them carefully to stay alive during the pandemic so when I found out about this I stated nah it can’t hold true however when I dug around I even contacted us to my political leader friends Governor Senators they didn’t learn about it I mean that’s how you know that’s how misinformation is that there’s no info out there then a bunch of people informed me well you can’t get it since you took the PPP also not real so let’s ask Josh why does nobody understand about the worker retention credit you understand what’s interesting you’re talking about the banks Kevin due to the fact that 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 country and they would process process 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 turmoil because remember in the original cares act you might refrain from doing both programs so if you had actually done PPP you might not do ERC in the initial program and when they altered 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 government never made it clear to anyone about how to.
do this does your CFO know how to do this not truly 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 business your accountant no your accounting professional’s never done this prior to unless you have an account that went into this service and bottom line my firm Kevin has stayed in business given that 2009 and we’ve been dealing with the federal government and the state government to recuperate money for Fortune 500 Fortune 1000 business so a lot of our huge big corporate clients have actually dealt with bottom line to recover other federal government programs we’ve done sales tax and utilize tax unemployment tax work opportunity tax credits research and development tax credits unclaimed home 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 earnings paid by an.
Due to the fact that of COVID-19 or whose gross receipts, employer whose service is completely or partially suspended.
decrease by more than 50%.
1. The credit is available to all employers despite size including tax exempt companies. There are.
only 2 exceptions: (1) state and city governments and their instrumentalities and (2) little.
organizations who take Small company Loans.
2. To certify, the company has to meet one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the employer’s business is fully 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 similar quarter in 2019. When the.
company’s gross invoices go above 80% of a comparable quarter in 2019 they no longer qualify.
after the end of that quarter.
Estimation of the Credit.
The quantity of the credit is 50% of the qualifying wages paid up to $10,000 in overall.
It works 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.
Business that concentrate on ERC filing assistance normally provide competence and assistance to help organizations browse the complicated process of declaring the credit. They can offer various services, including:.
How is the employee retention credit calculated? Shareholder Wages Employee Retention Credit
Eligibility Evaluation: These companies will examine your company’s eligibility for the ERC based upon aspects such as your market, revenue, and operations. They can assist identify if you satisfy the requirements for the credit and determine the optimum credit quantity you can declare.
Documentation and Calculation: ERC filing services will assist in gathering the required documentation, such as payroll records and monetary declarations, to support your claim. They will also help determine the credit amount based upon eligible salaries and other certifying costs.
Retroactive Claim Review: If you are qualified to declare the ERC for previous quarters, these business can evaluate your previous payroll records and financials to recognize prospective opportunities for retroactive credits. They can assist you modify prior income tax return to claim these refunds.
Filing Assistance: Companies concentrating on ERC filings will prepare and send the necessary types and documents in your place. This includes finishing Type 941 or any other necessary tax return.
Compliance and Updates: ERC policies and assistance have actually developed gradually. These business remain updated with the latest changes and guarantee that your filings adhere to the most existing guidelines. They can likewise supply continuous support if the internal revenue service requests extra information or conducts an audit related to your ERC claim.
It is necessary to research and vet any company offering ERC filing support to ensure their reliability and competence. Try to find recognized companies with experience in tax and payroll services, or think about connecting to trusted accounting firms or tax specialists who provide ERC filing support.
Keep in mind that while these companies can offer valuable help, it’s constantly an excellent idea to have a fundamental understanding of the ERC requirements and procedure yourself. This will assist you make notified decisions and make sure precise filings.
The Worker Retention Credit (ERC) is a refundable tax credit presented by the U.S. government as part of COVID-19 relief measures. The goal of the ERC is to motivate organizations to maintain and pay their workers throughout the pandemic, even if their operations have been impacted.
Here are some key points about the ERC:.
Eligibility: The ERC is available to eligible employers, consisting of for-profit businesses, tax-exempt organizations, and specific governmental entities. To qualify, employers need to satisfy one of two requirements:.
The business operations were totally or partly suspended due to a government order related to COVID-19.
Business experienced a significant decrease in gross receipts. As discussed earlier, for 2021, a significant decline is specified as a 20% decline in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a substantial 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 right away preceding quarter.
Credit Amount: The ERC is a refundable tax credit that offsets the employer’s share of Social Security taxes. The credit amount amounts to a percentage (up to 70%) of qualified earnings paid to workers, consisting of particular health plan expenses. The maximum credit per employee is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, organizations that received a Paycheck Protection Program (PPP) loan were not eligible for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 permits companies to claim the ERC even if they received a PPP loan. Nevertheless, the same salaries can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has actually been retroactively broadened and boosted, permitting eligible employers to claim the credit for certified incomes paid as far back as March 13, 2020. This retroactive arrangement offers a chance for businesses to change prior-year income tax return and receive refunds.
Declaring the Credit: Companies can claim the ERC by reporting it on their work income tax return, generally Form 941. If the credit surpasses the quantity of employment taxes owed, the excess can be refunded to the company.
It is essential to keep in mind that the ERC provisions and eligibility criteria have progressed gradually. The best course of action is to talk to a tax professional or go to the main internal revenue service website for the most detailed and current info relating to the ERC, including any recent legislative modifications or updates.
To get approved for the ERC, a service should meet one of the following criteria:.
Business operations were fully or partly suspended due to a federal government order related to COVID-19.
The business experienced a considerable decrease in gross receipts. For 2021, a significant decline is specified as a 20% decrease in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a substantial decrease is defined as a 20% decrease in gross receipts compared to the exact same quarter in 2019, or a 20% decline in gross receipts compared to the right away preceding quarter.
The ERC is readily available to businesses of all sizes, including tax-exempt organizations, but there are some exceptions. For example, federal government entities and organizations that received a PPP loan may have limitations on claiming the credit.
The procedure for declaring the ERC involves completing the necessary forms and consisting of the credit on your employment tax return (normally Type 941). The exact time it requires to process the credit can vary based upon a number of aspects, consisting of the complexity of your organization and the work of the IRS. It’s advised to speak with a tax professional for assistance specific to your scenario.
There are numerous companies that can assist with the procedure of claiming the ERC. Some popular business that use help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the info supplied here is based upon basic understanding and may not show the most recent updates or modifications to the ERC. It is essential to talk to a tax professional or go to the official internal revenue service website for the most accurate and current information relating to eligibility, declaring treatments, and offered support.
Less than 100. The credit is based if the company had 100 or fewer staff members on average in 2019.
on incomes paid to all workers 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 company still gets the credit.
Greater than 100. The credit is if the employer had more than 100 workers on average in 2019.
permitted just for earnings paid to staff members who did not work throughout the calendar quarter.
In both cases, “wages” includes not just money payments but also a portion of the expense of company.
offered health care. Shareholder Wages Employee Retention Credit
Employers can be instantly repaid for the credit by lowering the quantity of payroll taxes they.