Lets talk first about Controlled Group Employee Retention Credit :
Our group here what do these people doing everybody in this space is assisting teach individuals about ERC and uh constantly offer a beautiful breakfast and have individuals actually discover the program we need to head to the room where we have the ability to show some of the checks that we are getting for business and I want to see that what is this this is uh numerous millions of dollars literally Kevin numerous millions of dollars so these are replicate copies of the letters that go to customers confirming that the check is on the method I suggest you understand if you simply 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 imply it’s simply I suggest 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 confirmed and the check is on the mail in the mail from the internal revenue service heading to the client 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 which’s when they pay so they don’t pay anything up until they really receive the money they don’t pay bottom line Wonder trust anything till this letter is validated the check is on the method they transfer it into their bank account and they can really trust Wonder trust that the procedure has actually been completed and the number of you think you have actually processed since you began this we’re about 35 000 of these for
about 6 billion dollars wow so plainly they know what they’re doing and that’s what you require 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 Fantastic here you’re at my YouTube channel we’re discussing something really essential today the employee retention credit which the majority of you have never ever become aware of I definitely hadn’t become aware of it till really just recently and discovered a lot about it since this is probably the lowest cost of capital for any small business anywhere
anytime if you have staff members 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 challenging this isn’t like PPP we just call your bank supervisor and state offer me a loan it doesn’t 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 spokesperson for this I love this program it’s disappearing very soon you got to learn everything about it let’s talk worker 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 offered businesses 3 chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically everyone it makes a big distinction right there two of them are loans and one’s a refund exactly so the ERC is a refund that’s.
correct the cash money payroll tax refund all right go on sorry I simply need to make certain we got that point I indicate that’s a huge difference a loan versus cash cash I like cash cash that’s what we’re discussing 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 cash from the IRS all right so let’s talk about how it works due to the fact that it seems like to me if it’s a if it’s employee retention credit that person needed to be an employee so I’m going to make the Assumption this cash is not for the owner not for individuals on the cap table not for investors it’s for workers right you needed to have owned an organization but it’s based upon you having W-2 workers in America not 10.99. As long as you had W-2 staff members 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 very first 6 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 two three and 4 of 2020 and you had quarters one 2 and 3 of 2021. fine 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 cash how much can you return per worker that was on a W-2 in those 6 quarters so the calculation in 2020 to be precise Kevin is 50 of the employee’s wage to a maximum of 5 thousand dollars per worker for the year of 2020 and in 2021 the numbers increased to 70 of the employee’s wage to a maximum of seven thousand per quarter how did that happen um they simply altered 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 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 then what takes place 21 000 Max in 2021 oh that’s how you come up with twenty 6 thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty six thousand dollars per employee that is since that’s a lot of money it is now there’s a caveat here the PPP cash would need to be lowered from the twenty six thousand dollars so if you took PPP loan one and PPP loan 2 you would decrease the 26 000 so what we’re seeing usually Kevin is if you took PPP cash somewhere around 10 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 staff members and you took PPP money you would still get a million dollar in the mail from the internal revenue service so it’s big obviously now the huge question is why does no one know about this because appearance when I initially became aware of this when I initially fulfilled Josh you know I’ve got lots of financial investments in great deals of companies I’m a major advocate for entrepreneurship in America and make lots of lots of investments in business owners of which lots of suffered through the pandemic when I initially became aware of this I called BS I do not think it since I use the PPP we went through the money 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 should have and we used them wisely to survive throughout the pandemic so when I became aware of this I stated nah it can’t be true however when I dug around I even called to my political leader good friends Governor Senators they didn’t learn about it I mean that’s how you know 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 likewise not true so let’s ask Josh why does no one know about the staff member retention credit you know what’s intriguing you’re talking about the banks Kevin since in the PPP loan process the federal government made it really clear that if you wanted a PPP loan you would call Wells Fargo Citibank Bank of America any of the big 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 process that’s all um and here there was mayhem since keep in mind in the original cares act you might not do both programs so if you had actually 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 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 any person about how to.
do this does your CFO understand how to do this not actually she or he’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 business your accountant no your accounting professional’s never done this prior to unless you have an account that went into this organization and bottom line my firm Kevin has stayed in business considering that 2009 and we’ve been working with the federal government and the state government to recover money for Fortune 500 Fortune 1000 companies so a great deal of our huge big corporate customers have actually worked with bottom line to recover other government programs we’ve 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 government programs.
The employee retention tax credit is a broad based refundable tax credit created to encourage.
companies to keep staff members on their payroll. The credit is 50% of up to $10,000 in incomes paid by an.
employer whose business is completely or partially suspended because of COVID-19 or whose gross receipts.
decrease by more than 50%.
1. The credit is available to all companies despite size consisting of tax exempt organizations. There are.
just two exceptions: (1) state and local governments and their instrumentalities and (2) little.
businesses who take Small company Loans.
2. To qualify, the employer needs to fulfill one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the employer’s service is completely or partly suspended by federal government order due to COVID-19.
throughout the calendar quarter or.
o the employer’s gross receipts are below 50% of the equivalent quarter in 2019. As soon as the.
company’s gross receipts exceed 80% of an equivalent quarter in 2019 they no longer qualify.
after the end of that quarter.
Calculation of the Credit.
The quantity of the credit is 50% of the qualifying incomes paid up to $10,000 in total.
It is effective for salaries 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.
Business that specialize in ERC filing support normally supply knowledge and assistance to help companies browse the complicated procedure of claiming the credit. They can use numerous services, consisting of:.
How is the employee retention credit calculated? Controlled Group Employee Retention Credit
Eligibility Assessment: These business will assess your business’s eligibility for the ERC based upon elements such as your market, income, and operations. They can help determine if you satisfy the requirements for the credit and recognize the optimum credit quantity you can claim.
Paperwork and Estimation: ERC filing services will help in gathering the essential documents, such as payroll records and financial statements, to support your claim. They will likewise assist compute the credit quantity based on qualified earnings and other qualifying expenses.
Retroactive Claim Evaluation: If you are eligible to declare the ERC for previous quarters, these business can review your previous payroll records and financials to identify prospective chances for retroactive credits. They can assist you modify prior tax returns to declare these refunds.
Filing Support: Business focusing on ERC filings will prepare and submit the necessary kinds and paperwork in your place. This includes completing Form 941 or any other required tax return.
Compliance and Updates: ERC regulations and guidance have developed with time. These business remain updated with the latest modifications and make sure that your filings abide by the most current guidelines. If the IRS requests additional details or conducts an audit associated to your ERC claim, they can also supply ongoing assistance.
It is essential to research study and veterinarian any company using ERC filing assistance to guarantee their trustworthiness and know-how. Try to find established firms with experience in tax and payroll services, or think about connecting to relied on accounting firms or tax professionals who use ERC submitting support.
Bear in mind that while these companies can offer valuable assistance, it’s constantly a great idea to have a basic understanding of the ERC requirements and procedure yourself. This will assist you make notified choices and guarantee 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 procedures. The objective of the ERC is to motivate organizations to keep and pay their employees throughout the pandemic, even if their operations have actually been affected.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is offered to eligible companies, consisting of for-profit services, tax-exempt companies, and particular governmental entities. To certify, companies should satisfy one of two criteria:.
Business operations were totally or partially suspended due to a government order related to COVID-19.
Business experienced a substantial decline in gross receipts. As discussed earlier, for 2021, a significant decrease is defined as a 20% decrease in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a significant decline is defined as a 20% decrease in gross invoices compared to the same quarter in 2019, or a 20% decline in gross receipts 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 quantity is equal to a percentage (as much as 70%) of certified wages paid to staff members, consisting of certain health plan expenditures. 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, companies that got an Income Security Program (PPP) loan were not eligible for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 enables services to claim the ERC even if they got a PPP loan. The very same wages can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively broadened and improved, enabling eligible employers to claim the credit for qualified salaries paid as far back as March 13, 2020. This retroactive arrangement supplies an opportunity for organizations to modify prior-year income tax return and receive refunds.
Claiming the Credit: Employers can declare the ERC by reporting it on their employment income tax return, usually Form 941. The excess can be reimbursed to the company if the credit exceeds the amount of employment taxes owed.
It is essential to note that the ERC provisions and eligibility criteria have actually developed gradually. The best strategy is to seek advice from a tax professional or visit the official IRS website for the most current and in-depth info regarding the ERC, including any recent legal modifications or updates.
To receive the ERC, a service must fulfill among the following requirements:.
The business operations were totally or partly suspended due to a government order related to COVID-19.
The business experienced a considerable decrease in gross receipts. For 2021, a considerable decline is defined as a 20% decline in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a substantial decline is defined as a 20% decrease in gross receipts compared to the exact same quarter in 2019, or a 20% decline in gross receipts compared to the instantly preceding quarter.
The ERC is readily available to organizations of all sizes, consisting of tax-exempt organizations, but there are some exceptions. Federal government entities and services that received a PPP loan might have limitations on claiming the credit.
The procedure for claiming the ERC includes finishing the needed types and consisting of the credit on your employment income tax return (normally Form 941). The exact time it requires to process the credit can vary based upon a number of aspects, including the intricacy of your business and the workload of the IRS. It’s advised to speak with a tax professional for guidance specific to your scenario.
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 provider. Some well-known business that provide assistance with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s recommended to research and get in touch with these business straight to inquire about their services and charges.
Please note that the info supplied here is based upon general understanding and may not show the most recent updates or changes to the ERC. It is necessary to seek advice from a tax professional or go to the main internal revenue service site for the most current and accurate details concerning eligibility, claiming procedures, and readily available support.
Less than 100. The credit is based if the company had 100 or fewer workers on average in 2019.
on earnings paid to all employees whether they really 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.
allowed only for earnings paid to workers who did not work during the calendar quarter.
In both cases, “salaries” includes not just money payments but also a portion of the expense of employer.
supplied health care. Controlled Group Employee Retention Credit
Employers can be immediately compensated for the credit by reducing the quantity of payroll taxes they.