Lets talk first about When Will Employee Retention Credit Be Paid :
Our team here what do these men doing everybody in this room is assisting teach individuals about ERC and uh always provide a beautiful breakfast and have individuals really learn more about the program we must head to the space where we are able to show some of the checks that we are getting for business and I want to see that what is this this is uh hundreds of countless dollars literally Kevin numerous millions of dollars so these are replicate copies of the letters that go to customers validating that the check is on the way I indicate you know if you simply start 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 imply it’s simply I suggest think of how many real 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 IRS heading to the client so that’s how you have the ability to track it you understand when you
get this you understand the check is chosen sure which’s when they pay so they do not pay anything up until they actually receive the cash they do not pay bottom line Wonder trust anything up until this letter is verified the check is on the way they deposit it into their bank account and they can genuinely rely on Wonder trust that the procedure has been completed and the number of you believe you have actually processed considering that you started this we’re about 35 000 of these for
about 6 billion dollars wow so clearly 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 Wonderful here you’re at my YouTube channel we’re speaking about something really important today the staff member retention credit which the majority of you have actually never ever heard of I definitely had not become aware of it up until very just recently and discovered a lot about it due to the fact that this is most likely the lowest cost of capital for any small business anywhere
anytime if you have staff members in between 5 and five hundred so I have actually got the specialist with me this is Josh Fox he’s the founder and CEO of bottom line Principles 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 call up your bank supervisor and say 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 ended up being yes the Ambassador and paid representative for this I enjoy this program it’s disappearing very soon you got to discover all about it let’s talk worker retention credit Josh Fox what is an ERC let’s simply begin there so during 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 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 cash payroll tax refund all right go on sorry I just need to make certain we got that point I suggest that’s a big distinction a loan versus cash cash I like money cash that’s what we’re discussing 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 initial cares Act is the ERC and yes Kevin it is a stunning hard check in the mail where you get real cash from the internal revenue service all right so let’s talk about 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 staff member so I’m going to make the Presumption this money is not for the owner not for people on the cap table not for investors it’s for employees right you needed to have actually owned a company 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 need to be on payroll for the 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 two 3 and 4 of 2020 and you had quarters one 2 and 3 of 2021. alright so that’s how it’s measured you need to be on the W-2 during that duration now let’s talk my preferred part cash how much can you get back per staff member that was on a W-2 in those 6 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 worker for the year of 2020 and in 2021 the numbers escalated to 70 of the staff member’s wage to an optimum of 7 thousand per quarter how did that happen um they just altered 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 workers 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 takes place 21 000 Max in 2021 oh that’s how you develop twenty six thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty six thousand dollars per worker that is since that’s a lot of cash it is now there’s a caution here the PPP money would have to be decreased from the twenty six thousand dollars so if you took PPP loan one and PPP loan 2 you would minimize the 26 000 so what we’re seeing typically Kevin is if you took PPP money someplace around 10 thousand dollars a person so let’s say hypothetically you owned a restaurant in New york city City where I’m from and you had a hundred workers and you took PPP cash you would still get a million dollar in the mail from the IRS so it’s huge obviously now the huge question is why does no one know about this due to the fact that look when I first heard about this when I first met Josh you understand I’ve got great deals of investments in great deals of companies I’m a major advocate for entrepreneurship in America and make many lots of financial investments in entrepreneurs of which many suffered through the pandemic when I initially heard about this I called BS I do not think it since I utilize the PPP we went through the money center Banks to get it it was very easy to do we had our CEOs call the banks they got their loans which were well should have and we utilized them sensibly to survive throughout the pandemic so when I heard about this I said nah it can’t be true but when I dug around I even contacted us to my politician friends Guv Senators they didn’t understand about it I suggest that’s how you understand 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 true so let’s ask Josh why does no one learn about the staff member retention credit you know what’s fascinating you’re discussing the banks Kevin due to the fact that in the PPP loan process the federal government made it very clear that if you wanted 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 procedure that’s all um and here there was mayhem due to the fact that remember in the initial cares act you might not do both programs so if you had actually done PPP you could not do ERC in the initial 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 ever made it clear to anybody about how to.
do this does your CFO understand how to do this not really she or he’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 ever done this prior to unless you have an account that entered into this business and bottom line my firm Kevin has actually stayed in business considering that 2009 and we’ve been dealing with the federal government and the state federal government to recuperate cash for Fortune 500 Fortune 1000 business so a lot of our huge huge business customers have dealt with bottom line to recover other federal government programs we have actually done sales tax and use tax unemployment tax work chance 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.
employers to keep workers on their payroll. The credit is 50% of up to $10,000 in earnings paid by an.
employer whose organization is fully or partly suspended because of COVID-19 or whose gross invoices.
decline by more than 50%.
1. The credit is offered to all employers no matter size including tax exempt organizations. There are.
just 2 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 satisfy one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the employer’s organization is totally or partly 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 comparable quarter in 2019. When the.
employer’s gross invoices 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 incomes 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 earnings differs by whether a company had, usually, more or less than.
100 staff members in 2019.
Business that focus on ERC filing help generally supply expertise and support to assist services browse the complicated procedure of claiming the credit. They can provide numerous services, consisting of:.
How is the employee retention credit calculated? When Will Employee Retention Credit Be Paid
Eligibility Assessment: These business will evaluate your company’s eligibility for the ERC based on elements such as your industry, profits, and operations. If you fulfill the requirements for the credit and determine the maximum credit amount you can claim, they can help identify.
Documentation and Estimation: ERC filing services will assist in collecting the required paperwork, such as payroll records and financial declarations, to support your claim. They will also assist calculate the credit quantity based on qualified wages and other qualifying costs.
Retroactive Claim Review: If you are eligible to claim the ERC for prior quarters, these business can examine your past payroll records and financials to identify prospective chances for retroactive credits. They can help you modify prior income tax return to declare these refunds.
Filing Assistance: Companies specializing in ERC filings will prepare and send the required types and documentation on your behalf. This includes completing Type 941 or any other required tax forms.
Compliance and Updates: ERC policies and guidance have developed with time. These business stay updated with the latest modifications and make sure that your filings comply with the most current standards. If the IRS requests extra info or performs an audit related to your ERC claim, they can likewise supply continuous support.
It is very important to research and veterinarian any business offering ERC filing assistance to guarantee their credibility and competence. Look for established firms with experience in tax and payroll services, or think about reaching out to relied on accounting companies or tax experts who use ERC filing support.
Remember that while these companies can offer important support, 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 precise filings.
The Employee Retention Credit (ERC) is a refundable tax credit presented by the U.S. federal government as part of COVID-19 relief measures. The objective of the ERC is to motivate services to keep and pay their workers during the pandemic, even if their operations have been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is offered to eligible employers, including for-profit companies, tax-exempt companies, and specific governmental entities. To qualify, employers must meet one of two criteria:.
The business operations were fully or partly suspended due to a federal government order related to COVID-19.
The business experienced a substantial decrease in gross receipts. As discussed earlier, for 2021, a substantial decline is specified as a 20% decrease in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a substantial decline is specified as a 20% decrease in gross invoices compared to the very same quarter in 2019, or a 20% decline 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 amount amounts to a percentage (up to 70%) of qualified incomes paid to staff members, consisting of certain 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: At first, businesses that received an Income Security Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 enables companies to claim the ERC even if they received a PPP loan. The same incomes can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has actually been retroactively expanded and improved, allowing eligible employers to declare the credit for qualified salaries paid as far back as March 13, 2020. This retroactive arrangement supplies an opportunity for services to change prior-year tax returns and get refunds.
Declaring the Credit: Employers can declare the ERC by reporting it on their employment tax returns, usually Kind 941. If the credit exceeds the quantity of employment taxes owed, the excess can be refunded to the company.
It is very important to keep in mind that the ERC arrangements and eligibility requirements have progressed over time. The best course of action is to talk to a tax expert or check out the official internal revenue service site for the most updated and detailed information concerning the ERC, including any recent legal changes or updates.
To qualify for the ERC, a service must meet one of the following criteria:.
The business operations were fully or partially suspended due to a government order related to COVID-19.
The business experienced a substantial decline in gross invoices. For 2021, a significant decline is defined as a 20% decline in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a considerable decline is specified as a 20% decline in gross receipts compared to the very same quarter in 2019, or a 20% decrease in gross invoices compared to the instantly preceding quarter.
The ERC is offered to companies of all sizes, including tax-exempt organizations, however there are some exceptions. For instance, federal government entities and organizations that got a PPP loan might have restrictions on declaring the credit.
The procedure for claiming the ERC includes completing the needed forms and including the credit on your employment income tax return (usually Form 941). The exact time it requires to process the credit can vary based on a number of elements, consisting of the intricacy of your company and the workload of the IRS. It’s recommended to talk to a tax professional for assistance specific to your circumstance.
There are several business that can help with the procedure of declaring the ERC. Some well-known companies that offer help with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the details supplied here is based upon general understanding and may not reflect the most recent updates or modifications to the ERC. It’s important to talk to a tax expert or visit the main IRS site for the most precise and updated details relating to eligibility, claiming treatments, and available help.
Less than 100. The credit is based if the employer had 100 or less staff members on average in 2019.
on wages paid to all workers whether they in fact worked or not. Simply put, even if the.
staff members worked full-time and earned money for full time work, the company still gets the credit.
Greater than 100. The credit is if the employer had more than 100 staff members on average in 2019.
permitted only for wages paid to staff members who did not work throughout the calendar quarter.
In both cases, “wages” consists of not just cash payments however also a portion of the expense of company.
offered health care. When Will Employee Retention Credit Be Paid
Companies can be instantly repaid for the credit by reducing the amount of payroll taxes they.