Lets talk first about What Is Refundable Portion Of Employee Retention Credit :
Our group here what do these guys doing everybody in this room is assisting teach people about ERC and uh constantly provide a gorgeous breakfast and have individuals actually learn about the program we need to head to the space where we are able to display some of the checks that we are getting for business and I wish to see that what is this this is uh hundreds of millions of dollars literally Kevin numerous countless dollars so these are replicate copies of the letters that go to customers verifying that the check is on the way I mean you know if you simply begin 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 simply 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 verified the numbers are verified 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
get this you understand the check is opted for sure which’s when they pay so they don’t pay anything until they actually 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 checking account and they can truly rely on Wonder trust that the procedure has actually been completed and the number of you believe you’ve processed since you began this we’re about 35 000 of these for
about six billion dollars wow so plainly 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 Fantastic here you’re at my YouTube channel we’re discussing something actually essential today the staff member retention credit which the majority of you have never ever become aware of I definitely had not heard of it till extremely just recently and discovered a lot about it because this is probably the most affordable cost of capital for any small business anywhere
anytime if you have employees between five and five hundred so I’ve got the professional 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 difficult this isn’t like PPP we just call up your bank manager 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 all of us 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 going away very soon you got to find out everything about it let’s talk employee retention credit Josh Fox what is an ERC let’s simply begin there so throughout the Trump Administration when President Trump was enacted they developed the cares Act and the cares act used organizations 3 opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly everybody it makes a huge distinction right there two 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 ensure we got that point I mean that’s a huge difference a loan versus money cash I like money money that’s what we’re talking 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 beautiful hard check in the mail where you get actual cash 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 worker retention credit that individual 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 company however it’s based on you having W-2 staff members in America not 10.99. so as long as you had W-2 staff members and you paid federal payroll taxes that’s why you would be qualified so you need 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 correct so there were six quarters the program was open well walk us through the 6 quarters so you had quarters 2 three and 4 of 2020 and you had quarters one two and 3 of 2021. fine so that’s how it’s determined you have to be on the W-2 during that duration now let’s talk my preferred part money how much can you get back per employee that was on a W-2 in those six quarters so the computation in 2020 to be exact Kevin is 50 of the employee’s wage to a maximum of five thousand dollars per worker for the year of 2020 and in 2021 the numbers escalated to 70 of the employee’s salary to an optimum of 7 thousand per quarter how did that happen um they simply changed the rules in.
2021 versus due to the fact that the turmoil 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 5 thousand Max and then what takes place 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 six thousand dollars per staff member that is because that’s a great deal of cash it is now there’s a caveat here the PPP money would have to be decreased 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 typically Kevin is if you took PPP cash somewhere around ten thousand dollars a person so let’s say hypothetically you owned a restaurant 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 internal revenue service so it’s huge undoubtedly now the big concern is why does nobody learn about this due to the fact that look when I first became aware of this when I initially satisfied Josh you understand I’ve got great deals of investments in great deals of business I’m a major supporter for entrepreneurship in America and make numerous lots of investments in business owners of which many suffered through the pandemic when I initially heard about this I called BS I do not think it because I use the PPP we went through the cash center Banks to get it it was extremely easy to do we had our CEOs call the banks they got their loans which were well been worthy of and we utilized them carefully to survive throughout the pandemic so when I found out about this I stated nah it can’t be true but when I dug around I even contacted us to my politician pals Governor Senators they didn’t know about it I indicate that’s how you know that’s how misinformation is that there’s no information out there then a bunch of individuals told me well you can’t get it due to the fact that you took the PPP also not real so let’s ask Josh why does no one understand about the employee retention credit you understand what’s fascinating you’re speaking about the banks Kevin since 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 country and they would process procedure 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 because keep in mind in the initial cares act you might not do both programs so if you had actually done PPP you might refrain from doing ERC in the initial program and when they changed 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 any person about how to.
do this does your CFO know how to do this not truly 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 a few of them are doing it as a payroll company your accountant no your accountant’s never ever done this before unless you have an account that entered into this company and bottom line my firm Kevin has actually stayed in business given that 2009 and we’ve been working with the federal government and the state federal government to recuperate money for Fortune 500 Fortune 1000 business so a great deal of our huge big corporate customers have worked with bottom line to recuperate other government programs we have actually done sales tax and utilize tax joblessness tax work opportunity tax credits research and development tax credits unclaimed property 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 earnings paid by an.
company whose business is totally or partly suspended because of COVID-19 or whose gross receipts.
decrease by more than 50%.
1. The credit is available to all employers no matter size consisting of tax exempt organizations. There are.
just 2 exceptions: (1) state and city governments and their instrumentalities and (2) little.
organizations 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 employer’s company is completely or partially suspended by government order due to COVID-19.
during the calendar quarter or.
o the employer’s gross receipts are listed below 50% of the equivalent quarter in 2019. Once the.
company’s gross receipts exceed 80% of an equivalent quarter in 2019 they no longer qualify.
after completion of that quarter.
Calculation of the Credit.
The quantity of the credit is 50% of the certifying salaries paid up to $10,000 in overall.
It is effective for salaries paid after March 13th and before December 31, 2020.
The meaning of qualifying earnings varies by whether a company had, on average, basically than.
100 workers in 2019.
Companies that concentrate on ERC filing support normally provide competence and assistance to help organizations browse the intricate process of declaring the credit. They can provide various services, including:.
How is the employee retention credit calculated? What Is Refundable Portion Of Employee Retention Credit
Eligibility Assessment: These business will assess your company’s eligibility for the ERC based upon aspects such as your market, revenue, and operations. If you fulfill the requirements for the credit and determine the maximum credit amount you can claim, they can assist determine.
Paperwork and Estimation: ERC filing services will help in collecting the needed documentation, such as payroll records and financial statements, to support your claim. They will also assist determine the credit amount based upon eligible earnings and other qualifying costs.
Retroactive Claim Evaluation: If you are eligible to claim the ERC for prior quarters, these business can evaluate your past payroll records and financials to determine possible opportunities for retroactive credits. They can help you modify previous tax returns to declare these refunds.
Filing Help: Companies concentrating on ERC filings will prepare and submit the necessary forms and documentation on your behalf. This includes finishing Type 941 or any other required tax return.
Compliance and Updates: ERC regulations and assistance have evolved gradually. These business stay upgraded with the current changes and guarantee that your filings adhere to the most existing guidelines. If the Internal revenue service requests extra info or performs an audit related to your ERC claim, they can likewise offer continuous assistance.
It’s important to research and veterinarian any business using ERC filing support to guarantee their credibility and know-how. Try to find recognized companies with experience in tax and payroll services, or think about connecting to trusted accounting firms or tax experts who use ERC submitting support.
Keep in mind that while these companies can supply important support, it’s always an excellent idea to have a basic understanding of the ERC requirements and process yourself. This will assist you make notified decisions and guarantee accurate filings.
The Staff Member 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 staff members during the pandemic, even if their operations have actually been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is readily available to qualified companies, consisting of for-profit organizations, tax-exempt companies, and particular governmental entities. To certify, companies need to fulfill one of two criteria:.
Business operations were totally or partly suspended due to a government order related to COVID-19.
The business experienced a considerable decline in gross invoices. As discussed previously, for 2021, a significant decline is specified as a 20% decrease in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a substantial decrease is specified as a 20% decrease in gross invoices compared to the same quarter in 2019, or a 20% decline in gross invoices compared to the immediately preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit amount is equal to a portion (approximately 70%) of qualified wages paid to employees, consisting of certain health insurance expenditures. The maximum 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 got an Income Protection Program (PPP) loan were not eligible for the ERC. However, legislation passed in late 2020 and extended in 2021 allows companies to declare the ERC even if they got a PPP loan. However, the same earnings can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively broadened and enhanced, allowing eligible employers to declare the credit for qualified earnings paid as far back as March 13, 2020. This retroactive arrangement offers an opportunity for organizations to modify prior-year income tax return and get refunds.
Declaring the Credit: Companies can declare the ERC by reporting it on their employment tax returns, typically Form 941. If the credit surpasses the amount of employment taxes owed, the excess can be reimbursed to the employer.
It is essential to note that the ERC provisions and eligibility requirements have actually evolved gradually. The best strategy is to speak with a tax professional or go to the main IRS website for the most comprehensive and current information regarding the ERC, consisting of any current legal modifications or updates.
To get approved for the ERC, a company must fulfill one of the following criteria:.
The business operations were totally or partly suspended due to a government order related to COVID-19.
Business experienced a substantial decrease in gross invoices. For 2021, a considerable decline is defined as a 20% decrease in gross receipts compared to the exact 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.
The ERC is available to organizations of all sizes, including tax-exempt organizations, but there are some exceptions. Federal government entities and companies that received a PPP loan may have limitations on declaring the credit.
The process for declaring the ERC includes finishing the required types and consisting of the credit on your employment tax return (typically 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 company and the work of the internal revenue service. It’s advised to consult with a tax professional for guidance specific to your circumstance.
There are numerous companies that can assist with the procedure of declaring the ERC. Some popular business that offer help with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the info supplied here is based on general understanding and might not show the most recent updates or modifications to the ERC. It is essential to talk to a tax professional or go to the main internal revenue service site for the most accurate and current details concerning eligibility, claiming procedures, and available assistance.
Less than 100. The credit is based if the employer 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.
workers worked full-time and earned money for full time work, the company still gets the credit.
Greater than 100. If the employer had more than 100 staff members usually in 2019, then the credit is.
enabled just for salaries paid to workers who did not work during the calendar quarter.
In both cases, “wages” consists of not simply money payments but also a portion of the cost of employer.
offered healthcare. What Is Refundable Portion Of Employee Retention Credit
Employers can be right away compensated for the credit by lowering the quantity of payroll taxes they.