Lets talk first about Illinois Department Of Revenue Employee Retention Credit :
Our team here what do these guys doing everybody in this space is helping teach people about ERC and uh always provide a beautiful breakfast and have individuals really learn about the program we need to head to the room where we have the ability to display 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 clients verifying that the check is on the way I indicate you understand if you just begin to look at a few of these here I suggest this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I indicate it’s just I imply think of the number of actual customers that went through the program yeah this is the very end this is the party at the end when the check is verified the numbers are verified and the check is on the mail in the mail from the IRS heading to the consumer so that’s how you have the ability to track it you know when you
get this you know the check is gone for sure and that’s when they pay so they don’t pay anything till they in fact receive the money they do not pay bottom line Wonder trust anything up until this letter is validated the check is on the way they deposit it into their checking account and they can genuinely trust Wonder trust that the process has actually been finished and how many you think 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 and that’s what you need 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 talking about something actually important today the worker retention credit which most of you have actually never ever become aware of I certainly hadn’t become aware of it up until extremely just recently and found out a lot about it because this is probably the lowest cost of capital for any small company anywhere
anytime if you have staff members in between five and five hundred so I’ve got the professional with me this is Josh Fox he’s the creator and CEO of bottom line Concepts they’re the biggest processor of these ERC credits this is a 170 page program so it’s hard this isn’t like PPP we just contact your bank supervisor and state give 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 spokesperson for this I like this program it’s disappearing very soon you got to learn all about it let’s talk worker retention credit Josh Fox what is an ERC let’s simply start there so during the Trump Administration when President Trump was enacted they created the cares Act and the cares act offered businesses 3 opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically 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 money payroll tax refund okay go on sorry I simply have to ensure we got that point I suggest that’s a big difference a loan versus cash cash I like money money that’s what we’re speaking 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 initial cares Act is the ERC and yes Kevin it is a beautiful tough check in the mail where you get real cash from the internal revenue service all right so let’s talk about how it works since 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 individuals on the cap table not for investors it’s for employees right you needed to have actually owned a business however 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 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 right so there were 6 quarters the program was open well walk us through the six quarters so you had quarters two 3 and 4 of 2020 and you had quarters one two and 3 of 2021. alright so that’s how it’s determined you have to be on the W-2 during that period now let’s talk my favorite part money just how much can you return per employee that was on a W-2 in those six quarters so the computation in 2020 to be specific Kevin is 50 of the employee’s salary to an optimum of 5 thousand dollars per staff member for the year of 2020 and in 2021 the numbers escalated to 70 of the staff member’s salary to an optimum of 7 thousand per quarter how did that happen um they simply altered the rules in.
2021 versus because 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 as much as five thousand Max and after that what takes place 21 000 Max in 2021 oh that’s how you create twenty 6 thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty 6 thousand dollars per worker that is since that’s a great deal of money it is now there’s a caveat 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 two you would lower the 26 000 so what we’re seeing usually Kevin is if you took PPP money somewhere around ten thousand dollars a person so let’s state hypothetically you owned a restaurant in New york city 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 internal revenue service so it’s big clearly now the big concern is why does nobody know about this due to the fact that appearance when I initially found out about this when I first satisfied Josh you know I’ve got great deals of investments in great deals of companies I’m a major advocate for entrepreneurship in America and make many numerous financial investments in business owners of which many suffered through the pandemic when I first found out about this I called BS I don’t think it because I use 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 been worthy of and we utilized them sensibly to survive throughout the pandemic so when I heard about this I stated nah it can’t hold 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 know that’s how misinformation is that there’s no information out there then a bunch of individuals informed me well you can’t get it because you took the PPP also not true so let’s ask Josh why does no one know about the worker retention credit you understand what’s fascinating you’re talking about the banks Kevin because in the PPP loan procedure 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 huge banks in our country and they would process process in Canada a pre-pp loan there’s no loans in Canada by the way it’s simply process procedure that’s all um and here there was turmoil due to the fact that remember in the original cares act you could refrain from doing 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 refraining from 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 actually she or he’s never done it previously 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 business your accountant no your accountant’s never done this prior to unless you have an account that went into this company and bottom line my firm Kevin has actually been in business because 2009 and we have actually been dealing with the federal government and the state government to recuperate cash for Fortune 500 Fortune 1000 business so a lot of our huge big corporate clients have actually worked with bottom line to recover other government programs we’ve done sales tax and use tax unemployment tax work opportunity tax credits research and development tax credits unclaimed home real estate tax all of these other federal government programs.
The worker retention tax credit is a broad based refundable tax credit designed to motivate.
companies to keep workers on their payroll. The credit is 50% of approximately $10,000 in incomes paid by an.
company whose business is totally or partly suspended because of COVID-19 or whose gross receipts.
decline by more than 50%.
1. The credit is available to all employers no matter size consisting of tax exempt companies. There are.
just two exceptions: (1) state and city governments and their instrumentalities and (2) small.
organizations who take Small company Loans.
2. To qualify, the company needs to meet one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the company’s company is fully or partly suspended by federal government order due to COVID-19.
during the calendar quarter or.
o the company’s gross invoices are listed below 50% of the equivalent quarter in 2019. As soon as the.
company’s gross receipts go above 80% of a comparable 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 earnings paid up to $10,000 in overall.
It is effective for earnings paid after March 13th and before December 31, 2020.
The definition of qualifying incomes varies by whether an employer had, typically, basically than.
100 employees in 2019.
Companies that focus on ERC filing support usually supply know-how and support to assist businesses navigate the intricate procedure of declaring the credit. They can provide numerous services, including:.
How is the employee retention credit calculated? Illinois Department Of Revenue Employee Retention Credit
Eligibility Evaluation: These companies will evaluate your service’s eligibility for the ERC based upon aspects such as your market, profits, and operations. If you fulfill the requirements for the credit and determine the optimum credit amount you can declare, they can assist identify.
Paperwork and Calculation: ERC filing services will assist in gathering the needed paperwork, such as payroll records and financial declarations, to support your claim. They will also help compute the credit amount based upon qualified wages and other qualifying expenditures.
Retroactive Claim Evaluation: If you are eligible to claim the ERC for prior quarters, these business can review your past payroll records and financials to identify possible opportunities for retroactive credits. They can assist you modify previous income tax return to declare these refunds.
Filing Assistance: Business specializing in ERC filings will prepare and send the needed forms and documents on your behalf. This includes finishing Form 941 or any other required tax forms.
Compliance and Updates: ERC guidelines and guidance have progressed gradually. These companies remain updated with the most recent changes and guarantee that your filings adhere to the most existing guidelines. If the Internal revenue service demands additional details or performs an audit related to your ERC claim, they can also offer ongoing support.
It is essential to research and vet any business using ERC filing support to guarantee their reliability and know-how. Try to find recognized companies with experience in tax and payroll services, or think about connecting to trusted accounting firms or tax professionals who provide ERC submitting support.
Bear in mind that while these companies can provide important help, it’s always a great concept to have a fundamental understanding of the ERC requirements and process yourself. This will help you make informed choices and make sure accurate filings.
The Worker Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief procedures. The goal of the ERC is to motivate organizations to keep and pay their staff members throughout the pandemic, even if their operations have been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is available to qualified companies, including for-profit services, tax-exempt companies, and specific governmental entities. To qualify, employers must meet one of two criteria:.
The business operations were totally or partially suspended due to a federal government order related to COVID-19.
Business experienced a considerable decrease in gross invoices. As discussed earlier, for 2021, a considerable decline is defined as a 20% decrease in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a considerable decrease is specified as a 20% decline in gross invoices compared to the exact same quarter in 2019, or a 20% decline in gross invoices compared to the instantly 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 portion (approximately 70%) of certified salaries paid to employees, consisting of specific health insurance costs. The optimum credit per staff member is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, businesses that got an Income Defense Program (PPP) loan were not eligible for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 enables businesses to declare the ERC even if they got a PPP loan. The very same incomes can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively expanded and enhanced, enabling qualified companies to claim the credit for qualified salaries paid as far back as March 13, 2020. This retroactive provision supplies a chance for companies to change prior-year income tax return and receive refunds.
Declaring the Credit: Companies can claim the ERC by reporting it on their employment tax returns, generally Form 941. The excess can be refunded to the employer if the credit exceeds the quantity of employment taxes owed.
It’s important to note that the ERC provisions and eligibility criteria have actually developed over time. The very best strategy is to seek advice from a tax expert or check out the official internal revenue service website for the most comprehensive and current info concerning the ERC, including any recent legal modifications or updates.
To receive the ERC, a business must fulfill among the following requirements:.
The business operations were completely or partially suspended due to a federal government order related to COVID-19.
Business experienced a substantial decrease in gross invoices. For 2021, a substantial decline is specified as a 20% decrease in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a significant 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 right away preceding quarter.
The ERC is offered to organizations of all sizes, consisting of tax-exempt companies, but there are some exceptions. Federal government entities and companies that got a PPP loan may have constraints on declaring the credit.
The procedure for claiming the ERC includes finishing the essential forms and including the credit on your work income tax return (normally Form 941). The exact time it takes to process the credit can vary based on a number of elements, including the intricacy of your organization and the workload of the internal revenue service. It’s recommended to speak with a tax professional for assistance specific to your situation.
There are several business that can assist with the procedure of claiming the ERC. These consist of accounting companies, tax advisory services, and payroll company. Some widely known business that provide help with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s recommended to research and get in touch with these companies straight to inquire about their fees and services.
Please keep in mind that the information supplied here is based on general understanding and might not reflect the most current updates or changes to the ERC. It is essential to talk to a tax expert or check out the official internal revenue service site for the most accurate and updated information regarding eligibility, declaring treatments, and readily available assistance.
Less than 100. The credit is based if the employer had 100 or fewer employees on average in 2019.
on earnings paid to all employees whether they actually worked or not. Simply put, even if the.
staff members worked full time and got paid for full-time work, the company still gets the credit.
Greater than 100. The credit is if the employer had more than 100 employees on average in 2019.
permitted just for incomes paid to staff members who did not work during the calendar quarter.
In both cases, “salaries” includes not just cash payments however also a part of the expense of employer.
provided health care. Illinois Department Of Revenue Employee Retention Credit
Companies can be immediately reimbursed for the credit by decreasing the quantity of payroll taxes they.