Lets talk first about What Are Qualified Wages For Employee Retention Credit :
Our team here what do these guys doing everyone in this room is assisting teach people about ERC and uh constantly offer a gorgeous breakfast and have individuals really learn more about the program we must head to the room where we are able to display some of the checks that we are getting for business and I ‘d like to see that what is this this is uh numerous millions of dollars literally Kevin hundreds of countless dollars so these are duplicate copies of the letters that go to clients confirming that the check is on the way I suggest you know if you simply start to look at some 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 just I imply consider how many real clients that went through the program yeah this is the very end this is the celebration 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 customer so that’s how you have the ability to track it you understand when you
receive this you know the check is opted for sure and that’s when they pay so they don’t pay anything until they actually receive the money they don’t pay bottom line Wonder trust anything until this letter is validated the check is on the way they transfer it into their savings account and they can truly rely on Wonder trust that the process has actually been completed and how many you think 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 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 discussing something really crucial today the staff member retention credit which the majority of you have actually never become aware of I certainly had not heard of it up until extremely 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 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 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 contact your bank manager and say 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’ve become yes the Ambassador and paid representative for this I love 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 during the Trump Administration when President Trump was enacted they created the cares Act and the cares act offered services three opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically everyone it makes a huge difference right there two of them are loans and one’s a refund precisely so the ERC is a refund that’s.
remedy the money money payroll tax refund alright go on sorry I simply have to make sure we got that point I imply that’s a big distinction a loan versus money money I like cash money that’s what we’re discussing 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 actual money from the IRS all right so let’s talk about how it works since it sounds like to me if it’s a if it’s employee retention credit that individual needed 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 investors it’s for workers right you had to have owned an organization however it’s based on you having W-2 employees 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 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 six months of 2021 on the W-2 right so there were 6 quarters the program was open well stroll us through the 6 quarters so you had quarters 2 3 and four of 2020 and you had quarters one two and 3 of 2021. alright so that’s how it’s determined you have to be on the W-2 throughout that duration now let’s talk my preferred part money how much can you return per staff member that was on a W-2 in those six quarters so the computation in 2020 to be specific Kevin is 50 of the employee’s salary to a maximum of five thousand dollars per staff member for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the staff member’s wage to an optimum of 7 thousand per quarter how did that take place um they simply changed the rules in.
2021 versus due to the fact that the chaos of the pandemic so they wanted to even get more to keep those workers 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 then 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 six thousand dollars per employee that is because that’s a great deal of money it is now there’s a caveat here the PPP money would need to be lowered 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 restaurant 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 obviously now the huge question is why does nobody know about this since look when I first found out about this when I initially satisfied Josh you understand I have actually got great deals of financial investments in great deals of business I’m a significant advocate for entrepreneurship in America and make numerous lots of financial investments in entrepreneurs of which lots of suffered through the pandemic when I initially found out about this I called BS I don’t think it because I utilize 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 which were well been worthy of and we used them carefully to survive during the pandemic so when I became aware of this I stated nah it can’t hold true however when I dug around I even contacted us to my political leader friends Guv Senators they didn’t know about it I suggest that’s how you understand that’s how false information is that there’s no info out there then a lot of people told me well you can’t get it because you took the PPP also not true so let’s ask Josh why does no one understand about the staff member retention credit you understand what’s fascinating you’re speaking about the banks Kevin because 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 just process procedure that’s all um and here there was chaos because remember in the original cares act you could not do both programs so if you had done PPP you might refrain from doing ERC in the original program and when they changed the law in 2021 the banks were refraining from doing ERC due to the fact that it’s not alone so you’re getting a tax refund so the federal government never made it clear to anybody about how to.
do this does your CFO understand how to do this not really he or she’s never done it previously 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 accountant’s never ever done this prior to unless you have an account that went into this service and bottom line my company Kevin has been in business because 2009 and we’ve been dealing with the federal government and the state government to recover cash for Fortune 500 Fortune 1000 companies so a great deal of our big huge corporate clients have actually dealt with bottom line to recover other federal government programs we’ve done sales tax and use tax unemployment tax work opportunity tax credits research and development tax credits unclaimed home property tax all of these other federal government programs.
The staff member 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 as much as $10,000 in salaries paid by an.
Because of COVID-19 or whose gross invoices, employer whose organization is completely or partially suspended.
decrease by more than 50%.
1. The credit is offered to all employers no matter size including tax exempt companies. There are.
just two exceptions: (1) state and local governments and their instrumentalities and (2) little.
organizations who take Small company Loans.
2. To certify, the employer has to meet one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the company’s organization is totally or partially suspended by government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross receipts are below 50% of the comparable quarter in 2019. As soon as the.
company’s gross receipts go above 80% of a similar quarter in 2019 they no longer certify.
after the end of that quarter.
Computation of the Credit.
The amount of the credit is 50% of the certifying earnings paid up to $10,000 in total.
It works for incomes paid after March 13th and before December 31, 2020.
The meaning of qualifying salaries differs by whether a company had, typically, more or less than.
100 workers in 2019.
Business that focus on ERC filing support normally supply competence and support to help businesses browse the complicated process of declaring the credit. They can use different services, including:.
How is the employee retention credit calculated? What Are Qualified Wages For Employee Retention Credit
Eligibility Assessment: These business will examine your company’s eligibility for the ERC based on elements such as your industry, income, and operations. They can help identify if you fulfill the requirements for the credit and recognize the maximum credit quantity you can claim.
Documents and Estimation: ERC filing services will assist in collecting the needed paperwork, such as payroll records and monetary declarations, to support your claim. They will likewise assist compute the credit quantity based upon eligible earnings and other qualifying expenses.
Retroactive Claim Evaluation: If you are eligible to declare the ERC for prior quarters, these business can review your past payroll records and financials to recognize potential opportunities for retroactive credits. They can assist you modify previous income tax return to declare these refunds.
Filing Support: Companies focusing on ERC filings will prepare and send the required kinds and documents in your place. This includes finishing Form 941 or any other necessary tax forms.
Compliance and Updates: ERC guidelines and assistance have progressed over time. These companies remain upgraded with the most recent changes and guarantee that your filings adhere to the most current standards. They can likewise offer continuous support if the internal revenue service demands extra information or performs an audit related to your ERC claim.
It is very important to research study and vet any company offering ERC filing help to guarantee their credibility and proficiency. Try to find recognized companies with experience in tax and payroll services, or think about connecting to trusted accounting companies or tax professionals who use ERC submitting support.
Bear in mind that while these business can offer valuable help, it’s constantly an excellent concept to have a basic understanding of the ERC requirements and process yourself. This will help you make informed decisions and make sure accurate filings.
The Employee Retention Credit (ERC) is a refundable tax credit presented by the U.S. federal government as part of COVID-19 relief steps. The goal of the ERC is to encourage businesses to keep and pay their staff members during the pandemic, even if their operations have actually been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is available to eligible companies, including for-profit businesses, tax-exempt companies, and particular governmental entities. To qualify, companies should fulfill one of two criteria:.
Business operations were totally or partly suspended due to a federal government order related to COVID-19.
Business experienced a substantial decline in gross invoices. As pointed out previously, for 2021, a significant decrease is defined as a 20% decrease in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a substantial decline is specified as a 20% decrease in gross receipts 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 amount is equal to a percentage (approximately 70%) of certified incomes paid to employees, including certain health insurance expenses. The optimum credit per worker is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, businesses that received an Income Defense Program (PPP) loan were not qualified for the ERC. However, legislation passed in late 2020 and extended in 2021 enables businesses to claim the ERC even if they got a PPP loan. The same salaries can not be utilized to claim both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively broadened and enhanced, permitting qualified employers to declare the credit for qualified earnings paid as far back as March 13, 2020. This retroactive provision provides an opportunity for services to change prior-year tax returns and receive refunds.
Declaring the Credit: Companies can claim the ERC by reporting it on their work tax returns, typically Type 941. If the credit surpasses the quantity of employment taxes owed, the excess can be refunded to the company.
It’s important to note that the ERC arrangements and eligibility criteria have developed gradually. The very best strategy is to talk to a tax professional or go to the official IRS website for the most detailed and up-to-date details concerning the ERC, consisting of any recent legal changes or updates.
To get approved for the ERC, a service needs to fulfill one of the following criteria:.
Business operations were totally or partially suspended due to a federal government order related to COVID-19.
Business experienced a considerable decrease in gross invoices. For 2021, a considerable decline is specified as a 20% decline in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a considerable decline is defined as a 20% decline in gross receipts compared to the exact same quarter in 2019, or a 20% decrease in gross invoices compared to the immediately preceding quarter.
The ERC is available to companies of all sizes, including tax-exempt organizations, but there are some exceptions. Government entities and companies that got a PPP loan may have limitations on claiming the credit.
The procedure for declaring the ERC includes finishing the necessary kinds and consisting of the credit on your employment tax return (generally Type 941). The exact time it takes to process the credit can differ based upon numerous elements, including the intricacy of your organization and the workload of the internal revenue service. It’s recommended to consult with a tax expert for assistance particular to your circumstance.
There are a number of business that can assist with the procedure of claiming the ERC. Some popular business that use support with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the information offered here is based on general understanding and may not reflect the most recent updates or changes to the ERC. It is very important to speak with a tax professional or go to the main internal revenue service website for the most accurate and updated information concerning eligibility, claiming procedures, and available assistance.
Less than 100. If the company had 100 or less staff members typically in 2019, then the credit is based.
on incomes paid to all workers whether they really 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 workers typically in 2019, then the credit is.
enabled just for salaries paid to workers who did not work throughout the calendar quarter.
In both cases, “wages” consists of not just money payments however also a part of the expense of employer.
offered healthcare. What Are Qualified Wages For Employee Retention Credit
Companies can be immediately reimbursed for the credit by minimizing the quantity of payroll taxes they.