Lets talk first about Where Do I Claim The Employee Retention Credit :
Our team here what do these guys doing everyone in this room is helping teach individuals about ERC and uh constantly supply a beautiful breakfast and have people truly learn about the program we should head to the space where we are able to display some of the checks that we are getting for business and I want 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 clients verifying that the check is on the method I mean you understand if you just begin 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 mean it’s simply I indicate think of the number of real customers that went through the program yeah this is the very end this is the party at the end when the check is confirmed the numbers are verified and the check is on the mail in the mail from the internal revenue service heading to the consumer so that’s how you have the ability to track it you know when you
receive this you know the check is opted for sure and that’s when they pay so they do not pay anything up until they actually receive the money they do not pay bottom line Wonder trust anything till this letter is confirmed the check is on the way they transfer it into their checking account and they can really rely on Wonder trust that the process has been finished and the number of you believe you have actually processed since you started 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 require 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 important today the worker retention credit which most of you have never ever heard of I certainly had not heard of it till really recently and found out a lot about it because this is most likely the lowest expense of capital for any small business anywhere
anytime if you have workers between five and five hundred so I’ve got the specialist with me this is Josh Fox he’s the founder and CEO of bottom line Principles they’re the biggest processor of these ERC credits this is a 170 page program so it’s challenging this isn’t like PPP we simply contact 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 all of us about it and how to get it and why I’ve become yes the Ambassador and paid representative for this I enjoy this program it’s going away soon you got to find out everything about it let’s talk staff member retention credit Josh Fox what is an ERC let’s just begin there so during the Trump Administration when President Trump was enacted they developed 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 almost everybody it makes a big difference right there 2 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 okay go on sorry I just have to ensure we got that point I indicate that’s a big difference a loan versus money cash I like money money 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 original 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 talk about how it works since it sounds like to me if it’s a if it’s worker retention credit that person needed to be a staff member so I’m going to make the Assumption this money is not for the owner not for individuals on the cap table not for shareholders it’s for employees right you had to have owned a company but it’s based on you having W-2 workers 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 proper 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 2 and three of 2021. alright so that’s how it’s determined you have to be on the W-2 throughout that period now let’s talk my preferred part cash how much can you get back per employee that was on a W-2 in those 6 quarters so the computation in 2020 to be specific Kevin is 50 of the worker’s income to an optimum of 5 thousand dollars per staff member for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the staff member’s salary to an optimum of seven thousand per quarter how did that happen um they just changed the rules in.
2021 versus because the chaos of the pandemic so they wanted 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 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 five thousand in twenty twenty that’s twenty 6 thousand dollars per employee that is because that’s a lot of cash it is now there’s a caution here the PPP money would need to be minimized 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 cash someplace around 10 thousand dollars a person so let’s state hypothetically you owned a restaurant in New York City where I’m from and you had a hundred workers and you took PPP money you would still get a million dollar in the mail from the IRS so it’s big certainly now the big concern is why does nobody know about this because appearance when I first heard about this when I first met 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 many financial investments in business owners of which lots of suffered through the pandemic when I first heard about this I called BS I do not believe it since I utilize 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 deserved and we utilized them carefully to stay alive during the pandemic so when I became aware of this I said nah it can’t be true however when I dug around I even called to my political leader pals Governor Senators they didn’t learn about it I suggest that’s how you understand that’s how misinformation is that there’s no info out there then a bunch of people told me well you can’t get it because you took the PPP likewise not real so let’s ask Josh why does no one know about the employee retention credit you know what’s interesting you’re speaking about the banks Kevin since in the PPP loan process 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 nation and they would process process in Canada a pre-pp loan there’s no loans in Canada by the way it’s just procedure procedure that’s all um and here there was turmoil due to the fact that keep in mind in the original cares act you might not do 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 due to the fact that it’s not alone so you’re getting a tax refund so the government never ever made it clear to anyone about how to.
do this does your CFO understand how to do this not actually she or he’s never done it in the past do the banks do it nope the banks don’t do it the payroll companies yeah some of them are doing it as a payroll company your accounting professional no your accounting professional’s never done this before unless you have an account that went into this company and bottom line my firm Kevin has actually stayed 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 lot of our huge big business customers have actually dealt 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 property property tax all of these other government programs.
The worker retention tax credit is a broad based refundable tax credit developed to encourage.
companies to keep staff members on their payroll. The credit is 50% of up to $10,000 in earnings paid by an.
employer whose service 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 companies despite size including tax exempt companies. There are.
just two exceptions: (1) state and local governments and their instrumentalities and (2) little.
services who take Small company Loans.
2. To certify, the company has to satisfy one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the employer’s organization is totally or partly suspended by federal government order due to COVID-19.
throughout 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 receipts exceed 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 qualifying salaries paid up to $10,000 in overall.
It works for wages paid after March 13th and prior to December 31, 2020.
The definition of certifying wages differs by whether an employer had, typically, basically than.
100 staff members in 2019.
Companies that focus on ERC filing support generally provide proficiency and assistance to assist companies browse the intricate process of declaring the credit. They can offer different services, including:.
How is the employee retention credit calculated? Where Do I Claim The Employee Retention Credit
Eligibility Assessment: These companies will evaluate your service’s eligibility for the ERC based on aspects such as your industry, earnings, and operations. If you fulfill the requirements for the credit and determine the maximum credit quantity you can declare, they can assist identify.
Documentation and Calculation: ERC filing services will help in gathering the essential documents, such as payroll records and financial statements, to support your claim. They will also help calculate the credit quantity based on eligible incomes and other certifying expenses.
Retroactive Claim Evaluation: If you are qualified to declare the ERC for previous quarters, these companies can evaluate your previous payroll records and financials to identify potential opportunities for retroactive credits. They can help you modify previous tax returns to claim these refunds.
Filing Assistance: Business concentrating on ERC filings will prepare and send the essential forms and documentation on your behalf. This consists of finishing Kind 941 or any other necessary tax return.
Compliance and Updates: ERC regulations and guidance have evolved gradually. These business remain updated with the current modifications and guarantee that your filings comply with the most existing guidelines. They can also provide continuous support if the IRS demands additional details or conducts an audit related to your ERC claim.
It is very important to research study and vet any company offering ERC filing support to ensure their credibility and expertise. Look for recognized firms with experience in tax and payroll services, or consider connecting to relied on accounting firms or tax professionals who use ERC filing support.
Remember that while these companies can offer valuable assistance, it’s always an excellent idea to have a basic understanding of the ERC requirements and process yourself. This will assist you make informed decisions and make sure accurate filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief measures. The objective of the ERC is to motivate organizations to keep and pay their workers throughout the pandemic, even if their operations have actually been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is offered to qualified companies, including for-profit companies, tax-exempt organizations, and particular governmental entities. To certify, employers must satisfy one of two criteria:.
The business operations were completely or partly suspended due to a federal government order related to COVID-19.
The business experienced a considerable decline in gross invoices. As discussed previously, for 2021, a substantial decline is specified as a 20% decline in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a substantial decrease is defined as a 20% decrease in gross receipts compared to the very same quarter in 2019, or a 20% decline in gross invoices compared to the right away preceding quarter.
Credit Amount: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit quantity is equal to a portion (up to 70%) of certified wages paid to employees, consisting of specific health plan costs. 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, organizations that received an Income Defense Program (PPP) loan were not qualified for the ERC. However, legislation passed in late 2020 and extended in 2021 allows services to claim the ERC even if they got a PPP loan. The very same earnings can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively expanded and boosted, enabling eligible companies to declare the credit for certified salaries paid as far back as March 13, 2020. This retroactive arrangement supplies a chance for organizations to change prior-year income tax return and receive refunds.
Declaring the Credit: Employers can claim the ERC by reporting it on their work income tax return, usually Form 941. If the credit goes beyond the quantity of employment taxes owed, the excess can be reimbursed to the company.
It is essential to note that the ERC provisions and eligibility requirements have developed gradually. The very best strategy is to consult with a tax expert or visit the official IRS website for the most up-to-date and comprehensive info regarding the ERC, consisting of any current legal modifications or updates.
To get approved for the ERC, a service needs to meet one of the following requirements:.
The business operations were fully or partially suspended due to a federal government order related to COVID-19.
The business experienced a significant decline in gross receipts. For 2021, a significant decrease is specified as a 20% decline in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a considerable decrease is defined as a 20% decline in gross receipts 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 readily available to services of all sizes, consisting of tax-exempt companies, however there are some exceptions. For example, federal government entities and organizations that received a PPP loan might have restrictions on claiming the credit.
The procedure for declaring the ERC involves finishing the needed kinds and including the credit on your employment tax return (generally Type 941). The exact time it takes to process the credit can differ based upon numerous factors, including the complexity of your company and the workload of the internal revenue service. It’s advised to seek advice from a tax expert for assistance particular to your circumstance.
There are numerous companies that can assist with the procedure of declaring the ERC. These consist of accounting companies, tax advisory services, and payroll company. Some widely known business that provide assistance with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s suggested to research study and contact these companies straight to inquire about their costs and services.
Please keep in mind that the details supplied here is based upon basic understanding and may not show the most current updates or changes to the ERC. It is essential to speak with a tax expert or visit the main IRS website for the most updated and accurate info regarding eligibility, claiming procedures, and readily available support.
Less than 100. The credit is based if the employer had 100 or fewer workers on average in 2019.
on salaries paid to all workers whether they really worked or not. Simply put, even if the.
workers worked full time and made money for full time work, the employer still gets the credit.
Greater than 100. The credit is if the employer had more than 100 workers on average in 2019.
permitted only for incomes paid to employees who did not work during the calendar quarter.
In both cases, “salaries” includes not simply money payments but likewise a part of the cost of employer.
supplied health care. Where Do I Claim The Employee Retention Credit
Employers can be instantly compensated for the credit by lowering the quantity of payroll taxes they.