Lets talk first about Employee Retention Credit Gross Receipts Cash Or Accrual Basis :
Our team here what do these men doing everyone in this space is assisting teach people about ERC and uh always provide a stunning breakfast and have individuals really discover the program we need to head to the room where we have the ability to display a few 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 actually Kevin numerous countless dollars so these are replicate copies of the letters that go to customers verifying that the check is on the method I imply you understand if you just begin to look at a few of these here I indicate this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I mean it’s just I imply consider the number of real clients 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 customer so that’s how you have the ability to track it you know when you
receive this you understand the check is chosen sure which’s when they pay so they don’t pay anything till they really receive the money they don’t pay bottom line Wonder trust anything up until this letter is confirmed the check is on the method they deposit it into their bank account and they can genuinely trust Wonder trust that the process has been finished and how many you think you have actually 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 need 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 talking about something actually essential today the employee retention credit which the majority of you have never become aware of I certainly had not heard of it up until very recently and found out a lot about it due to the fact that this is most likely the lowest expense of capital for any small company anywhere
anytime if you have workers between five and five hundred so I have actually got the expert with me this is Josh Fox he’s the founder and CEO of bottom line Concepts they’re the biggest processor of these ERC credits this is a 170 page program so it’s not easy this isn’t like PPP we just phone your bank supervisor and say provide me a loan it does not work there’s not a loan it’s an application and Josh is going to inform us all 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 all about it let’s talk worker retention credit Josh Fox what is an ERC let’s just start there so during the Trump Administration when President Trump was enacted they developed the cares Act and the cares act used businesses three chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly everyone it makes a big difference right there 2 of them are loans and one’s a refund exactly so the ERC is a refund that’s.
fix the money money payroll tax refund alright go on sorry I just have to make certain we got that point I suggest that’s a huge distinction a loan versus cash cash I like money money that’s what we’re talking about alright 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 difficult check in the mail where you get actual money from the internal revenue service all right so let’s talk about how it works due to the fact that it sounds like to me if it’s a if it’s staff member retention credit that individual needed to be a worker 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 staff members right you had to have actually 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 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 walk us through the six quarters so you had quarters 2 three and 4 of 2020 and you had quarters one two and three of 2021. all right so that’s how it’s determined you need to be on the W-2 throughout that duration now let’s talk my preferred part money how much can you return per staff member that was on a W-2 in those six quarters so the estimation in 2020 to be exact Kevin is 50 of the worker’s wage to a maximum of five thousand dollars per worker for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the worker’s salary to a maximum of seven thousand per quarter how did that take place um they just altered the rules in.
2021 versus because the mayhem of the pandemic so they wished 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 5 thousand Max and then what occurs 21 000 Max in 2021 oh that’s how you develop twenty 6 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 because that’s a great deal of cash it is now there’s a caveat here the PPP money would need to be lowered from the twenty six thousand dollars so if you took PPP loan one and PPP loan 2 you would lower the 26 000 so what we’re seeing on average Kevin is if you took PPP money somewhere around ten thousand dollars an individual so let’s state hypothetically you owned a dining establishment 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 IRS so it’s big undoubtedly now the huge question is why does nobody learn about this due to the fact that appearance when I first found out about this when I first 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 many investments in business owners of which numerous suffered through the pandemic when I initially found out about this I called BS I don’t believe it due to the fact that 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 and that were well deserved 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 called to my politician good friends Guv Senators they didn’t learn about it I suggest that’s how you understand 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 due to the fact that you took the PPP also not real so let’s ask Josh why does nobody learn about the staff member retention credit you know what’s fascinating you’re discussing the banks Kevin since 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 big banks in our nation 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 since remember in the initial cares act you could refrain from doing both programs so if you had done PPP you might refrain from doing 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 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 previously do the banks do it nope the banks do not do it the payroll companies yeah some of them are doing it as a payroll business your accounting professional no your accountant’s never ever done this prior to unless you have an account that went into this organization and bottom line my firm Kevin has been in business considering that 2009 and we’ve been working with the federal government and the state federal government to recover cash for Fortune 500 Fortune 1000 business so a lot of our huge big business clients have 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 real estate tax all of these other federal government programs.
The staff member retention tax credit is a broad based refundable tax credit developed to motivate.
employers to keep workers on their payroll. The credit is 50% of as much as $10,000 in earnings paid by an.
company whose organization is completely or partly suspended because of COVID-19 or whose gross receipts.
decrease by more than 50%.
1. The credit is available to all companies despite size including tax exempt companies. There are.
only 2 exceptions: (1) state and local governments and their instrumentalities and (2) small.
businesses who take Small company Loans.
2. To certify, the company needs to fulfill one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the employer’s organization is totally or partly suspended by government order due to COVID-19.
throughout the calendar quarter or.
o the employer’s gross invoices are below 50% of the similar quarter in 2019. As soon as the.
employer’s gross invoices exceed 80% of a comparable 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 certifying wages paid up to $10,000 in overall.
It is effective for earnings paid after March 13th and before December 31, 2020.
The definition of certifying earnings varies by whether a company had, usually, more or less than.
100 employees in 2019.
Companies that concentrate on ERC filing help normally offer proficiency and assistance to help companies navigate the intricate process of declaring the credit. They can provide different services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit Gross Receipts Cash Or Accrual Basis
Eligibility Evaluation: These companies will assess your organization’s eligibility for the ERC based upon aspects such as your industry, revenue, and operations. If you fulfill the requirements for the credit and recognize the maximum credit amount you can declare, they can assist identify.
Documents and Calculation: ERC filing services will help in collecting the necessary paperwork, such as payroll records and financial declarations, to support your claim. They will also assist calculate the credit amount based on eligible incomes and other qualifying costs.
Retroactive Claim Review: If you are eligible to declare the ERC for prior quarters, these business can review your previous payroll records and financials to determine possible opportunities for retroactive credits. They can assist you change prior tax returns to declare these refunds.
Filing Assistance: Companies concentrating on ERC filings will prepare and submit the essential kinds and documents in your place. This consists of completing Kind 941 or any other required tax forms.
Compliance and Updates: ERC regulations and assistance have actually developed over time. These companies stay upgraded with the most recent modifications and make sure that your filings comply with the most existing standards. They can also offer continuous assistance if the internal revenue service demands additional details or performs an audit related to your ERC claim.
It is essential to research and vet any company using ERC filing assistance to ensure their credibility and competence. 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 filing support.
Keep in mind that while these companies can provide important help, it’s always a good concept to have a standard understanding of the ERC requirements and process yourself. This will help you make notified decisions and ensure accurate filings.
The Employee Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief measures. The goal of the ERC is to motivate companies to maintain and pay their workers during the pandemic, even if their operations have actually been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is offered to eligible companies, consisting of for-profit organizations, tax-exempt organizations, and particular governmental entities. To certify, companies should satisfy one of two criteria:.
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 receipts. As mentioned earlier, for 2021, a significant decrease is defined as a 20% decrease in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a significant decrease is defined as a 20% decline in gross invoices compared to the same quarter in 2019, or a 20% decrease 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 quantity is equal to a portion (up to 70%) of certified earnings paid to staff members, consisting of particular health insurance expenses. 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 received a Paycheck Defense Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 allows services to declare the ERC even if they got a PPP loan. The same earnings can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively expanded and enhanced, permitting eligible employers to declare the credit for certified wages paid as far back as March 13, 2020. This retroactive provision supplies a chance for companies to modify prior-year income tax return and get refunds.
Claiming the Credit: Employers can claim the ERC by reporting it on their employment tax returns, typically Kind 941. The excess can be reimbursed to the company if the credit surpasses the amount of work taxes owed.
It’s important to note that the ERC arrangements and eligibility requirements have evolved in time. The best course of action is to seek advice from a tax professional or go to the official internal revenue service site for the most updated and comprehensive details relating to the ERC, consisting of any recent legislative changes or updates.
To receive the ERC, an organization needs to fulfill one of the following requirements:.
The business operations were totally or partially suspended due to a federal government order related to COVID-19.
Business experienced a substantial decline in gross invoices. For 2021, a substantial decrease is defined as a 20% decrease in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a significant decline is specified as a 20% decline in gross invoices compared to the very same quarter in 2019, or a 20% decrease in gross receipts compared to the right away preceding quarter.
The ERC is offered to companies of all sizes, including tax-exempt organizations, however there are some exceptions. Federal government entities and businesses that received a PPP loan might have constraints on claiming the credit.
The process for declaring the ERC includes finishing the necessary types and consisting of the credit on your work tax return (usually Kind 941). The exact time it takes to process the credit can vary based on a number of factors, including the intricacy of your business and the work of the IRS. It’s advised to consult with a tax expert for assistance particular to your situation.
There are a number of business that can help with the procedure of claiming the ERC. Some popular companies that offer support with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the information offered here is based on general knowledge and may not reflect the most recent updates or modifications to the ERC. It is very important to seek advice from a tax professional or go to the main IRS site for the most current and precise info concerning eligibility, claiming procedures, and offered assistance.
Less than 100. If the employer had 100 or fewer employees typically in 2019, then the credit is based.
on incomes paid to all workers whether they really worked or not. Simply put, even if the.
staff members worked full time and made money for full-time work, the company 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 throughout the calendar quarter.
In both cases, “incomes” consists of not simply money payments however likewise a part of the cost of employer.
offered healthcare. Employee Retention Credit Gross Receipts Cash Or Accrual Basis
Employers can be instantly repaid for the credit by reducing the amount of payroll taxes they.