Lets talk first about Significant Decline In Gross Receipts Employee Retention Credit :
Our team here what do these people doing everyone in this room is assisting teach individuals about ERC and uh always offer a gorgeous breakfast and have people actually learn about the program we should head to the room where we have the ability to display a few of the checks that we are getting for business and I ‘d like to see that what is this this is uh numerous countless dollars actually Kevin hundreds of countless dollars so these are duplicate copies of the letters that go to customers verifying that the check is on the way I suggest you know 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 imply it’s simply I indicate think of how many actual customers that went through the program yeah this is the very end this is the celebration 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 client so that’s how you have the ability to track it you know when you
receive this you understand the check is chosen sure and that’s when they pay so they don’t pay anything up until they actually receive the cash they don’t pay bottom line Wonder trust anything up until this letter is verified the check is on the method they deposit it into their checking account and they can truly rely on Wonder trust that the process has been ended up and the number of you think you’ve processed since you began this we have to do with 35 000 of these for
about 6 billion dollars wow so plainly they understand what they’re doing and that’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 discussing something really crucial today the worker retention credit which the majority of you have never ever become aware of I certainly hadn’t heard of it until very just recently and found out a lot about it due to the fact that this is probably the lowest cost of capital for any small company anywhere
anytime if you have employees 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 Ideas they’re the biggest processor of these ERC credits this is a 170 page program so it’s difficult this isn’t like PPP we just phone 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 tell us all about it and how to get it and why I’ve become yes the Ambassador and paid representative for this I like 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 start there so throughout the Trump Administration when President Trump was enacted they developed the cares Act and the cares act used services three chances 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 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 fine go on sorry I simply need to ensure we got that point I indicate that’s a big distinction a loan versus money cash I like cash cash that’s what we’re talking 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 gorgeous tough check in the mail where you get real money from the internal revenue service all right so let’s talk about how it works because it seems like to me if it’s a if it’s staff member retention credit that person had to be a worker so I’m going to make the Presumption this cash is not for the owner not for individuals on the cap table not for shareholders it’s for staff members right you had to have owned a service however it’s based upon you having W-2 workers 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 proper so there were 6 quarters the program was open well walk us through the six 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 determined you need to be on the W-2 throughout that duration now let’s talk my favorite part cash just how much can you get back per employee that was on a W-2 in those six quarters so the estimation in 2020 to be exact Kevin is 50 of the employee’s income to a maximum of 5 thousand dollars per staff member for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the employee’s income to an optimum of seven thousand per quarter how did that happen 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 employees on payroll 100 so if you can get 5 000 per person Max in twenty that was 50 in 2020 up to five 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 because that’s a lot of money it is now there’s a caveat here the PPP cash would need to be minimized from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan two you would minimize the 26 000 so what we’re seeing typically Kevin is if you took PPP cash someplace around ten thousand dollars an individual so let’s say hypothetically you owned a dining establishment in New york city 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 internal revenue service so it’s big obviously now the huge concern is why does no one know about this because appearance when I initially heard about this when I first fulfilled Josh you understand I’ve got lots of investments in lots of business I’m a major advocate for entrepreneurship in America and make lots of many investments in entrepreneurs of which numerous suffered through the pandemic when I initially heard about this I called BS I do not think it due to the fact that I use the PPP we went through the cash center Banks to get it it was really easy to do we had our CEOs call the banks they got their loans and that were well should have and we utilized them carefully to survive throughout the pandemic so when I became aware of this I said nah it can’t hold true however when I dug around I even called to my politician friends Governor Senators they didn’t learn about it I suggest that’s how you know that’s how false information is that there’s no details out there then a bunch of people informed me well you can’t get it because you took the PPP likewise not true so let’s ask Josh why does no one learn about the staff member retention credit you know what’s intriguing you’re talking about the banks Kevin because in the PPP loan process 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 procedure procedure that’s all um and here there was chaos because keep in mind in the original cares act you could refrain from doing both programs so if you had actually done PPP you could not do ERC in the original program and when they changed the law in 2021 the banks were not doing ERC since 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 really she or he’s never ever done it in the past do the banks do it nope the banks do not do it the payroll business yeah a few of them are doing it as a payroll company your accounting professional no your accounting professional’s never ever done this before 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 working with the federal government and the state federal government to recover cash for Fortune 500 Fortune 1000 companies so a great deal of our big big corporate customers have dealt with bottom line to recuperate other government programs we have actually done sales tax and use tax unemployment tax work opportunity tax credits research and development tax credits unclaimed property real estate 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 employees on their payroll. The credit is 50% of as much as $10,000 in earnings paid by an.
company whose organization is totally or partially suspended because of COVID-19 or whose gross receipts.
decline by more than 50%.
Availability.
1. The credit is offered to all companies no matter size including tax exempt organizations. There are.
just two exceptions: (1) state and city governments and their instrumentalities and (2) little.
organizations who take Small company Loans.
2. To qualify, the company needs to fulfill one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the employer’s organization is completely or partially suspended by government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross invoices are listed below 50% of the equivalent quarter in 2019. As soon as the.
employer’s gross invoices exceed 80% of a comparable quarter in 2019 they no longer certify.
after the end of that quarter.
Estimation of the Credit.
The amount of the credit is 50% of the qualifying salaries paid up to $10,000 in overall.
It works for incomes paid after March 13th and before December 31, 2020.
The meaning of certifying incomes varies by whether an employer had, on average, basically than.
100 employees in 2019.
Companies that concentrate on ERC filing help typically offer expertise and assistance to help companies browse the intricate procedure of declaring the credit. They can offer numerous services, including:.
How is the employee retention credit calculated? Significant Decline In Gross Receipts Employee Retention Credit
Eligibility Assessment: These companies will examine your company’s eligibility for the ERC based upon factors such as your market, profits, and operations. If you fulfill the requirements for the credit and determine the maximum credit quantity you can declare, they can assist figure out.
Documentation and Computation: ERC filing services will assist in gathering the needed paperwork, such as payroll records and monetary statements, to support your claim. They will also assist determine the credit quantity based upon qualified wages and other qualifying expenditures.
Retroactive Claim Review: If you are eligible to declare the ERC for prior quarters, these business can examine your past payroll records and financials to determine prospective chances for retroactive credits. They can assist you modify previous tax returns to declare these refunds.
Filing Help: Companies specializing in ERC filings will prepare and send the needed types and documents in your place. This consists of completing Kind 941 or any other required tax forms.
Compliance and Updates: ERC policies and guidance have developed gradually. These business stay upgraded with the current modifications and ensure that your filings adhere to the most present standards. If the IRS requests extra info or carries out an audit associated to your ERC claim, they can also provide ongoing assistance.
It’s important to research and veterinarian any business offering ERC filing support to guarantee their trustworthiness and know-how. Look for recognized companies with experience in tax and payroll services, or think about reaching out to relied on accounting companies or tax professionals who offer ERC filing assistance.
Bear in mind that while these companies can supply valuable assistance, it’s always a great idea to have a fundamental understanding of the ERC requirements and procedure yourself. This will help you make informed choices and make sure accurate filings.
The Worker Retention Credit (ERC) is a refundable tax credit introduced by the U.S. federal government as part of COVID-19 relief procedures. The objective of the ERC is to encourage organizations to keep and pay their staff members throughout the pandemic, even if their operations have been affected.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is available to qualified employers, including for-profit businesses, tax-exempt organizations, and specific governmental entities. To qualify, employers need to fulfill one of two criteria:.
The business operations were completely or partially suspended due to a government order related to COVID-19.
The business experienced a significant decline in gross invoices. As discussed earlier, for 2021, a considerable decrease is specified as a 20% decline in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a significant decline is specified as a 20% decline in gross invoices compared to the exact same quarter in 2019, or a 20% decrease in gross invoices compared to the immediately preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the employer’s share of Social Security taxes. The credit quantity amounts to a portion (approximately 70%) of qualified earnings paid to employees, including certain health plan expenditures. 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 a Paycheck Security Program (PPP) loan were not qualified for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 allows businesses to claim the ERC even if they received a PPP loan. The same earnings can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively expanded and improved, permitting eligible companies to claim the credit for certified earnings paid as far back as March 13, 2020. This retroactive arrangement provides a chance for services to modify prior-year income tax return and receive refunds.
Claiming the Credit: Employers can claim the ERC by reporting it on their employment income tax return, generally Kind 941. The excess can be reimbursed to the employer if the credit exceeds the quantity of employment taxes owed.
It is necessary to note that the ERC provisions and eligibility requirements have evolved over time. The very best strategy is to speak with a tax professional or check out the main IRS site for the most comprehensive and up-to-date information concerning the ERC, consisting of any recent legislative changes or updates.
To receive the ERC, a company should fulfill 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 considerable decrease in gross receipts. For 2021, a substantial decrease is defined as a 20% decrease in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a significant decrease is specified as a 20% decrease in gross invoices compared to the same quarter in 2019, or a 20% decrease in gross invoices compared to the instantly preceding quarter.
The ERC is readily available to services of all sizes, consisting of tax-exempt organizations, however there are some exceptions. For instance, government entities and organizations that got a PPP loan may have restrictions on declaring the credit.
The process for declaring the ERC involves finishing the required kinds and including the credit on your employment tax return (generally Form 941). The exact time it takes to process the credit can differ based on a number of aspects, consisting of the complexity of your business and the workload of the internal revenue service. It’s suggested to seek advice from a tax expert for guidance particular to your circumstance.
There are numerous companies that can help with the procedure of declaring the ERC. These consist of accounting companies, tax advisory services, and payroll provider. Some well-known companies that provide support with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s recommended to research study and get in touch with these companies straight to inquire about their services and costs.
Please keep in mind that the info supplied here is based upon general knowledge and may not reflect the most current updates or changes to the ERC. It is very important to consult with a tax expert or visit the official IRS site for the most up-to-date and accurate information relating to eligibility, declaring procedures, and readily available help.
Less than 100. The credit is based if the company had 100 or fewer workers on average in 2019.
on wages paid to all workers whether they actually worked or not. Simply put, even if the.
staff members worked full-time and made money for full time work, the employer still gets the credit.
Greater than 100. If the employer had more than 100 staff members usually in 2019, then the credit is.
enabled only for incomes paid to employees who did not work during the calendar quarter.
In both cases, “wages” consists of not just cash payments but likewise a part of the cost of employer.
provided health care. Significant Decline In Gross Receipts Employee Retention Credit
Payment.
Companies can be instantly compensated for the credit by lowering the quantity of payroll taxes they.