Lets talk first about Does My Company Qualify For The Employee Retention Credit :
Our team here what do these people doing everybody in this room is helping teach individuals about ERC and uh constantly offer a beautiful breakfast and have people actually find out about the program we must head to the space 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 validating that the check is on the way I imply you know if you just start to look at some of these here I mean this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I indicate it’s just I indicate think about how many 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 consumer so that’s how you have the ability to track it you know when you
get this you understand the check is gone for sure and that’s when they pay so they do not pay anything till they in fact get the cash they do not pay bottom line Wonder trust anything up until this letter is verified the check is on the way they transfer 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’ve processed considering that you started this we’re about 35 000 of these for
about six billion dollars wow so plainly they know 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 Wonderful here you’re at my YouTube channel we’re speaking about something actually crucial today the employee retention credit which the majority of you have never heard of I definitely hadn’t become aware of it until extremely just recently and learned a lot about it because this is probably the lowest expense of capital for any small company anywhere
anytime if you have staff members 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 hard this isn’t like PPP we just call up your bank supervisor and state provide me a loan it does not 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 spokesperson for this I like this program it’s going away soon you got to learn 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 came up with the cares Act and the cares act used businesses 3 opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically everybody it makes a huge difference right there 2 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 okay go on sorry I just need to ensure we got that point I mean that’s a big distinction a loan versus money money I like money cash that’s what we’re speaking 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 original cares Act is the ERC and yes Kevin it is a gorgeous hard check in the mail where you get actual cash from the IRS all right so let’s discuss how it works due to the fact that it seems like to me if it’s a if it’s staff member retention credit that person had to be an employee 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 workers right you had to have owned an organization but it’s based on 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 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 correct so there were six 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 two and three of 2021. fine 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 worker that was on a W-2 in those 6 quarters so the computation in 2020 to be precise Kevin is 50 of the worker’s wage to an optimum of five thousand dollars per worker for the year of 2020 and in 2021 the numbers increased to 70 of the staff member’s income to an optimum of seven thousand per quarter how did that occur um they just changed the rules in.
2021 versus due to the fact that the turmoil of the pandemic so they wished 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 approximately 5 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 six thousand dollars per staff member that is since that’s a great deal of money it is now there’s a caveat 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 two you would decrease the 26 000 so what we’re seeing typically Kevin is if you took PPP money someplace around 10 thousand dollars an individual so let’s say hypothetically you owned a dining establishment 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 IRS so it’s substantial clearly now the huge question is why does nobody understand about this because look when I first became aware of this when I initially satisfied Josh you understand I have actually got lots of financial investments in lots of companies I’m a significant supporter for entrepreneurship in America and make lots of numerous financial investments in business owners of which lots of suffered through the pandemic when I first became aware of this I called BS I don’t believe it due to the fact that I utilize the PPP we went through the money center Banks to get it it was extremely easy to do we had our CEOs call the banks they got their loans and that were well deserved and we used them carefully to stay alive throughout the pandemic so when I became aware of this I said nah it can’t hold true but when I dug around I even contacted us to my political leader pals Guv Senators they didn’t understand about it I imply that’s how you know that’s how false information is that there’s no information out there then a bunch of people told me well you can’t get it since you took the PPP likewise not real so let’s ask Josh why does no one understand about the staff member retention credit you understand what’s fascinating you’re discussing the banks Kevin due to the fact that in the PPP loan procedure the federal government made it really clear that if you desired 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 simply procedure procedure that’s all um and here there was mayhem because keep in mind in the initial cares act you might not do both programs so if you had done PPP you could not do ERC in the initial program and when they altered 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 made it clear to anyone about how to.
do this does your CFO understand how to do this not truly he or she’s never ever done it in the past do the banks do it nope the banks don’t do it the payroll business yeah some of them are doing it as a payroll company your accounting professional no your accounting professional’s never ever done this prior to unless you have an account that went into this service and bottom line my firm Kevin has stayed in business since 2009 and we’ve been dealing with the federal government and the state federal government to recover money for Fortune 500 Fortune 1000 companies so a great deal of our huge huge business customers have actually worked with bottom line to recover other federal government programs we’ve 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 employee retention tax credit is a broad based refundable tax credit developed to motivate.
employers to keep employees on their payroll. The credit is 50% of as much as $10,000 in incomes paid by an.
Due to the fact that of COVID-19 or whose gross invoices, company whose company is fully or partly suspended.
decrease by more than 50%.
1. The credit is offered to all companies regardless of size consisting of tax exempt organizations. There are.
just two exceptions: (1) state and local governments and their instrumentalities and (2) small.
services who take Small company Loans.
2. To certify, the employer needs to meet one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the company’s organization is fully or partially suspended by federal government order due to COVID-19.
during the calendar quarter or.
o the employer’s gross receipts are listed below 50% of the similar quarter in 2019. As soon as the.
company’s gross invoices go above 80% of a similar quarter in 2019 they no longer certify.
after completion of that quarter.
Computation of the Credit.
The quantity of the credit is 50% of the qualifying incomes paid up to $10,000 in overall.
It is effective for earnings paid after March 13th and prior to December 31, 2020.
The definition of certifying earnings varies by whether an employer had, on average, more or less than.
100 employees in 2019.
Business that focus on ERC filing help generally supply know-how and assistance to assist organizations navigate the complicated process of declaring the credit. They can offer different services, including:.
How is the employee retention credit calculated? Does My Company Qualify For The Employee Retention Credit
Eligibility Assessment: These business will evaluate your business’s eligibility for the ERC based upon aspects such as your industry, income, and operations. If you meet the requirements for the credit and determine the optimum credit amount you can claim, they can assist determine.
Documents and Calculation: ERC filing services will assist in collecting the required paperwork, such as payroll records and monetary statements, to support your claim. They will also assist determine the credit quantity based upon qualified salaries and other certifying expenditures.
Retroactive Claim Evaluation: If you are eligible to claim the ERC for previous quarters, these business can evaluate your previous payroll records and financials to identify prospective chances for retroactive credits. They can help you change previous tax returns to declare these refunds.
Filing Support: Business focusing on ERC filings will prepare and send the required forms and documents in your place. This consists of finishing Type 941 or any other required tax return.
Compliance and Updates: ERC policies and assistance have evolved in time. These business remain updated with the most recent changes and ensure that your filings abide by the most present standards. If the Internal revenue service demands additional information or performs an audit associated to your ERC claim, they can likewise supply ongoing support.
It’s important to research and vet any company providing ERC filing assistance to ensure their credibility and knowledge. 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 submitting assistance.
Keep in mind that while these business can offer valuable assistance, it’s constantly a great concept to have a fundamental understanding of the ERC requirements and process yourself. This will help you make notified choices and make sure precise filings.
The Employee Retention Credit (ERC) is a refundable tax credit presented by the U.S. government as part of COVID-19 relief steps. The goal of the ERC is to encourage companies to retain and pay their workers throughout the pandemic, even if their operations have been impacted.
Here are some key points about the ERC:.
Eligibility: The ERC is offered to eligible employers, including for-profit businesses, tax-exempt organizations, and certain governmental entities. To qualify, companies need to 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 considerable decline in gross invoices. As discussed earlier, for 2021, a considerable decrease 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 specified 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 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 amounts to a percentage (approximately 70%) of certified incomes paid to employees, consisting of specific health plan costs. The maximum credit per worker is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: At first, services that received an Income Defense Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 enables organizations to claim the ERC even if they received a PPP loan. Nevertheless, the same wages can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively broadened and improved, allowing qualified companies to declare the credit for qualified salaries paid as far back as March 13, 2020. This retroactive arrangement provides an opportunity for services to modify prior-year tax returns and receive refunds.
Claiming the Credit: Employers can declare the ERC by reporting it on their employment income tax return, normally Form 941. If the credit exceeds the amount of work taxes owed, the excess can be refunded to the company.
It is essential to note that the ERC arrangements and eligibility criteria have actually progressed in time. The very best strategy is to consult with a tax expert or check out the official IRS website for the most detailed and up-to-date details relating to the ERC, including any recent legislative changes or updates.
To qualify for the ERC, an organization needs to satisfy among the following criteria:.
Business operations were fully or partially suspended due to a federal government order related to COVID-19.
The business experienced a significant decrease in gross receipts. For 2021, a considerable decline is defined as a 20% decrease in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a significant decrease is specified as a 20% decline in gross receipts compared to the same quarter in 2019, or a 20% decline in gross receipts compared to the right away preceding quarter.
The ERC is readily available to organizations of all sizes, consisting of tax-exempt organizations, but there are some exceptions. Government entities and services that received a PPP loan may have constraints on claiming the credit.
The process for declaring the ERC includes finishing the essential forms and consisting of the credit on your employment tax return (normally Form 941). The exact time it takes to process the credit can differ based upon a number of factors, consisting of the intricacy of your company and the workload of the IRS. It’s advised to talk to a tax professional for assistance specific to your circumstance.
There are a number of business that can help with the process of declaring the ERC. These consist of accounting companies, tax advisory services, and payroll provider. Some well-known business that use help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s suggested to research and call these companies directly to ask about their services and costs.
Please note that the info offered here is based on basic understanding and might not reflect the most current updates or changes to the ERC. It is necessary to speak with a tax professional or go to the official IRS website for the most precise and current info regarding eligibility, claiming treatments, and readily available assistance.
Less than 100. If the company had 100 or fewer staff members typically in 2019, then the credit is based.
on salaries paid to all employees whether they actually worked or not. In other words, even if the.
staff members worked full time and made money for full-time work, the employer still gets the credit.
Greater than 100. The credit is if the company had more than 100 workers on average in 2019.
enabled only for earnings paid to employees who did not work during the calendar quarter.
In both cases, “salaries” consists of not simply cash payments however also a portion of the cost of employer.
offered health care. Does My Company Qualify For The Employee Retention Credit
Employers can be immediately repaid for the credit by reducing the amount of payroll taxes they.