Lets talk first about Unclaimed Employee Retention Credits :
Our group here what do these men doing everybody in this space is helping teach people about ERC and uh always supply a lovely breakfast and have individuals really discover the program we should head to the space where we are able to display a few of the checks that we are getting for companies and I want 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 customers validating that the check is on the method I mean you know if you simply start to take a look at a few 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 imply think of how many actual clients 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 validated and the check is on the mail in the mail from the IRS heading to the customer so that’s how you’re able to track it you know when you
get this you understand the check is gone for sure and that’s when they pay so they do not pay anything till they in fact receive the money they don’t pay bottom line Wonder trust anything till this letter is verified the check is on the method they transfer it into their bank account and they can truly rely on Wonder trust that the process has actually been ended up and the number of you believe you have actually processed considering that you began this we’re about 35 000 of these for
about 6 billion dollars wow so clearly they understand what they’re doing which’s what you need you need specialists 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 Wonderful here you’re at my YouTube channel we’re talking about something really important today the worker retention credit which the majority of you have never ever heard of I definitely had not heard of it till very recently and discovered a lot about it because this is most likely the most affordable cost of capital for any small business anywhere
anytime if you have workers in 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 Ideas they’re the largest processor of these ERC credits this is a 170 page program so it’s hard this isn’t like PPP we just call up your bank supervisor and state give me a loan it doesn’t 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 have actually ended up being yes the Ambassador and paid spokesperson for this I like this program it’s going away very soon you got to discover everything about it let’s talk employee retention credit Josh Fox what is an ERC let’s simply start there so during the Trump Administration when President Trump was enacted they created the cares Act and the cares act provided businesses 3 chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically everybody it makes a big difference right there 2 of them are loans and one’s a refund exactly so the ERC is a refund that’s.
fix the money cash payroll tax refund fine go on sorry I just need to make sure we got that point I mean that’s a huge difference a loan versus cash money I like money 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 initial cares Act is the ERC and yes Kevin it is a lovely tough check in the mail where you get actual money from the IRS all right so let’s discuss how it works because 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 Assumption this money is not for the owner not for people on the cap table not for shareholders it’s for employees right you needed to have owned a company but it’s based upon you having W-2 workers in America not 10.99. so as long as you had W-2 workers 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 6 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 two three and 4 of 2020 and you had quarters one 2 and 3 of 2021. fine 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 how much can you get back 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 staff member’s wage to an optimum of 5 thousand dollars per employee 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 simply changed the rules in.
2021 versus due to the fact that 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 create 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 caution here the PPP cash would have to be minimized from the twenty six thousand dollars so if you took PPP loan one and PPP loan 2 you would reduce the 26 000 so what we’re seeing typically Kevin is if you took PPP money somewhere around ten 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 employees and you took PPP money you would still get a million dollar in the mail from the internal revenue service 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 heard about this when I initially satisfied Josh you know I have actually got lots of financial investments in lots of business I’m a significant advocate for entrepreneurship in America and make many numerous investments in entrepreneurs of which lots of suffered through the pandemic when I first found out about this I called BS I don’t believe 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 deserved and we used them sensibly to survive throughout the pandemic so when I heard about this I said nah it can’t be true however when I dug around I even contacted us to my politician pals Governor Senators they didn’t learn about it I indicate that’s how you understand that’s how false information is that there’s no info out there then a bunch of people told me well you can’t get it due to the fact that you took the PPP likewise not real so let’s ask Josh why does no one learn about the worker retention credit you know what’s fascinating you’re speaking about the banks Kevin because in the PPP loan procedure the federal government made it very clear that if you desired a PPP loan you would call Wells Fargo Citibank Bank of America any of the huge 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 process that’s all um and here there was chaos due to the fact that keep in mind in the original cares act you could 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 government never 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 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 done this before unless you have an account that went into this business and bottom line my firm Kevin has been in business because 2009 and we’ve been dealing with the federal government and the state government to recuperate cash for Fortune 500 Fortune 1000 business so a lot of our big huge business customers have actually worked with bottom line to recuperate other federal government programs we have actually done sales tax and utilize tax unemployment 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 designed to encourage.
companies to keep staff members on their payroll. The credit is 50% of approximately $10,000 in salaries paid by an.
Because of COVID-19 or whose gross invoices, company whose business is fully or partly suspended.
decrease by more than 50%.
1. The credit is readily available to all employers regardless of size including tax exempt organizations. There are.
only two exceptions: (1) state and city governments and their instrumentalities and (2) little.
services who take Small Business Loans.
2. To certify, the company has to fulfill one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the company’s service is fully or partly 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 similar quarter in 2019. Once the.
employer’s gross receipts go above 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 total.
It is effective for incomes paid after March 13th and prior to December 31, 2020.
The meaning of certifying salaries varies by whether an employer had, typically, basically than.
100 workers in 2019.
Companies that concentrate on ERC filing help usually provide proficiency and support to assist services navigate the complicated procedure of claiming the credit. They can offer various services, including:.
How is the employee retention credit calculated? Unclaimed Employee Retention Credits
Eligibility Evaluation: These business will assess your company’s eligibility for the ERC based upon factors such as your market, profits, and operations. They can help determine if you meet the requirements for the credit and identify the optimum credit amount you can declare.
Documentation and Estimation: ERC filing services will assist in gathering the needed paperwork, such as payroll records and financial declarations, to support your claim. They will likewise assist compute the credit amount based on qualified earnings and other qualifying expenses.
Retroactive Claim Review: If you are eligible to claim the ERC for prior quarters, these business can review your past payroll records and financials to determine potential opportunities for retroactive credits. They can help you amend prior tax returns to claim these refunds.
Filing Help: Companies focusing on ERC filings will prepare and send the required types and documentation in your place. This includes completing Type 941 or any other necessary tax forms.
Compliance and Updates: ERC regulations and guidance have actually progressed with time. These business remain updated with the most recent modifications and ensure that your filings comply with the most existing standards. If the IRS demands additional information or performs an audit related to your ERC claim, they can likewise provide ongoing assistance.
It is necessary to research study and veterinarian any business providing ERC filing assistance to ensure their credibility and competence. Look for recognized firms with experience in tax and payroll services, or think about connecting to relied on accounting firms or tax specialists who provide ERC submitting assistance.
Bear in mind that while these companies can supply important assistance, it’s always a great idea to have a fundamental understanding of the ERC requirements and process yourself. This will help you make informed choices and ensure 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 organizations to retain and pay their employees during the pandemic, even if their operations have been affected.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is readily available to qualified employers, consisting of for-profit services, tax-exempt companies, and specific governmental entities. To certify, employers should fulfill one of two criteria:.
The business operations were totally or partially suspended due to a federal government order related to COVID-19.
The business experienced a significant decrease in gross invoices. As discussed earlier, for 2021, a substantial decrease is specified as a 20% decrease in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a significant decrease is defined as a 20% decrease in gross invoices compared to the very 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 quantity is equal to a portion (approximately 70%) of certified salaries paid to workers, including specific health insurance 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, businesses that received a Paycheck Defense Program (PPP) loan were not eligible for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 enables companies to claim the ERC even if they got a PPP loan. The very same earnings can not be utilized to claim both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively broadened and improved, enabling qualified companies to declare the credit for certified wages paid as far back as March 13, 2020. This retroactive provision offers an opportunity for services to modify prior-year income tax return and get refunds.
Declaring the Credit: Companies can declare the ERC by reporting it on their work tax returns, usually Kind 941. The excess can be reimbursed to the employer if the credit exceeds the amount of work taxes owed.
It is essential to note that the ERC arrangements and eligibility requirements have actually evolved over time. The best strategy is to consult with a tax expert or visit the main IRS website for the most updated and detailed details relating to the ERC, including any current legal changes or updates.
To get approved for the ERC, a company must meet among the following requirements:.
Business operations were fully or partially suspended due to a government order related to COVID-19.
Business experienced a significant decrease in gross invoices. For 2021, a considerable decline is defined as a 20% decline in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a considerable decrease is specified as a 20% decline in gross invoices compared to the very same quarter in 2019, or a 20% decline in gross receipts compared to the right away preceding quarter.
The ERC is offered to organizations of all sizes, consisting of tax-exempt companies, but there are some exceptions. For instance, federal government entities and companies that got a PPP loan might have limitations on declaring the credit.
The procedure for declaring the ERC includes finishing the necessary kinds and including the credit on your employment tax return (generally Kind 941). The exact time it takes to process the credit can vary based on several elements, consisting of the complexity of your organization and the workload of the internal revenue service. It’s suggested to speak with a tax professional for guidance specific to your circumstance.
There are a number of business that can aid with the process of claiming the ERC. These include accounting companies, tax advisory services, and payroll company. Some well-known business that use support with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s a good idea to research and get in touch with these companies straight to ask about their services and fees.
Please note that the info provided here is based on general knowledge and might not show the most recent updates or modifications to the ERC. It is very important to seek advice from a tax professional or visit the official IRS site for the most updated and accurate information relating to eligibility, claiming treatments, and available assistance.
Less than 100. The credit is based if the company had 100 or fewer workers on average in 2019.
on incomes paid to all employees whether they really worked or not. To put it simply, even if the.
employees worked full-time and earned money for full-time work, the company still gets the credit.
Greater than 100. If the company had more than 100 employees on average in 2019, then the credit is.
permitted just for incomes paid to employees who did not work during the calendar quarter.
In both cases, “wages” consists of not simply money payments however also a part of the expense of company.
supplied healthcare. Unclaimed Employee Retention Credits
Companies can be instantly reimbursed for the credit by minimizing the quantity of payroll taxes they.