Lets talk first about Instructions For Employee Retention Credit :
Our group here what do these men doing everyone in this room is assisting teach people about ERC and uh constantly supply a beautiful breakfast and have individuals truly find out about the program we need to head to the room where we are able to display a few of the checks that we are getting for companies and I want to see that what is this this is uh hundreds of millions of dollars actually Kevin hundreds of millions of dollars so these are replicate copies of the letters that go to clients verifying that the check is on the way I suggest you understand 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 imply consider how many actual customers that went through the program yeah this is the very end this is the celebration at the end when the check is confirmed the numbers are confirmed 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
receive this you understand the check is gone for sure which’s when they pay so they don’t pay anything until they really receive the money they don’t pay bottom line Wonder trust anything till this letter is confirmed the check is on the method they transfer it into their checking account and they can really trust Wonder trust that the process has actually been finished and the number of you think you have actually processed because you began this we’re about 35 000 of these for
about 6 billion dollars wow so plainly they understand what they’re doing and that’s what you require you require specialists on the other end of the phone to process this and get it to where you get one of these that’s what matters all right Mr Fantastic here you’re at my YouTube channel we’re discussing something really essential today the staff member retention credit which most of you have never ever become aware of I certainly hadn’t heard of it up until really just recently and discovered a lot about it because this is most likely the most affordable expense of capital for any small business anywhere
anytime if you have workers in between 5 and five hundred so I’ve got the expert with me this is Josh Fox he’s the founder and CEO of bottom line Ideas 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 just phone 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 inform us all about it and how to get it and why I’ve become yes the Ambassador and paid representative for this I like this program it’s disappearing 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 start there so throughout the Trump Administration when President Trump was enacted they came up with 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 practically everyone it makes a huge difference right there 2 of them are loans and one’s a refund precisely so the ERC is a refund that’s.
correct the cash money payroll tax refund all right go on sorry I just need to make sure we got that point I indicate that’s a big distinction a loan versus cash money I like cash cash that’s what we’re speaking about 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 hard check in the mail where you get real cash from the IRS all right so let’s talk about how it works because it sounds like to me if it’s a if it’s employee retention credit that person had to be a worker so I’m going to make the Assumption this money is not for the owner not for people on the cap table not for investors it’s for workers right you had to have actually owned an organization but it’s based upon you having W-2 staff members in America not 10.99. so as long as you had W-2 workers 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 need to be on payroll for the first 6 months of 2021 on the W-2 appropriate so there were 6 quarters the program was open well stroll us through the 6 quarters so you had quarters 2 three and 4 of 2020 and you had quarters one two and 3 of 2021. fine so that’s how it’s measured you have to be on the W-2 during that period now let’s talk my favorite part money just how much can you get back per worker that was on a W-2 in those six quarters so the calculation in 2020 to be precise Kevin is 50 of the worker’s income to an optimum of five thousand dollars per worker for the year of 2020 and in 2021 the numbers escalated to 70 of the worker’s wage to an optimum of 7 thousand per quarter how did that take place um they just altered the rules in.
2021 versus due to the fact that the chaos 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 approximately five thousand Max and after that what happens 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 six thousand dollars per worker that is since that’s a lot of money it is now there’s a caution here the PPP money would have to be reduced from the twenty 6 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 someplace around ten thousand dollars a person so let’s state hypothetically you owned a dining establishment in New york city City where I’m from and you had a hundred workers and you took PPP cash you would still get a million dollar in the mail from the internal revenue service so it’s huge undoubtedly now the huge concern is why does nobody understand about this since look when I first heard about this when I initially met Josh you understand I’ve got great deals of financial investments in great deals of companies I’m a major advocate for entrepreneurship in America and make lots of numerous investments in entrepreneurs of which numerous suffered through the pandemic when I first heard about this I called BS I don’t believe it because I use the PPP we went through the money center Banks to get it it was very easy to do we had our CEOs call the banks they got their loans which were well should have and we utilized them carefully to stay alive throughout the pandemic so when I found out about this I stated nah it can’t be true however when I dug around I even contacted us to my politician friends Guv Senators they didn’t learn about it I indicate that’s how you know that’s how misinformation is that there’s no details out there then a bunch of individuals informed me well you can’t get it since you took the PPP likewise not real so let’s ask Josh why does nobody understand about the employee retention credit you know what’s interesting you’re talking about the banks Kevin because in the PPP loan process the federal government made it extremely clear that if you wanted a PPP loan you would call Wells Fargo Citibank Bank of America any of the big banks in our country and they would process procedure 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 mayhem since keep in mind in the initial cares act you could not do both programs so if you had actually done PPP you could refrain from doing 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 anybody about how to.
do this does your CFO understand how to do this not really he or she’s never ever done it in the past do the banks do it nope the banks do not do it the payroll business yeah some of them are doing it as a payroll company your accountant 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 actually stayed in business because 2009 and we’ve been dealing with the federal government and the state government to recuperate cash for Fortune 500 Fortune 1000 business so a great deal of our big huge business customers have worked with bottom line to recover other government programs we’ve done sales tax and utilize tax joblessness tax work chance tax credits research and development tax credits unclaimed property real estate tax all of these other government programs.
The employee retention tax credit is a broad based refundable tax credit designed to motivate.
companies to keep staff members on their payroll. The credit is 50% of approximately $10,000 in incomes paid by an.
company whose service is fully or partly suspended because of COVID-19 or whose gross invoices.
decrease by more than 50%.
1. The credit is offered to all companies no matter size consisting of tax exempt companies. There are.
only two exceptions: (1) state and city governments and their instrumentalities and (2) small.
services who take Small Business Loans.
2. To qualify, the employer needs to fulfill one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the employer’s organization is totally or partially suspended by government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross receipts are listed below 50% of the equivalent quarter in 2019. When the.
company’s gross invoices go above 80% of an equivalent quarter in 2019 they no longer qualify.
after the end of that quarter.
Calculation of the Credit.
The amount of the credit is 50% of the qualifying incomes paid up to $10,000 in overall.
It works for earnings paid after March 13th and before December 31, 2020.
The definition of certifying earnings varies by whether a company had, on average, more or less than.
100 workers in 2019.
Companies that focus on ERC filing help normally supply proficiency and support to assist companies navigate the complicated procedure of declaring the credit. They can provide various services, consisting of:.
How is the employee retention credit calculated? Instructions For Employee Retention Credit
Eligibility Assessment: These business will examine your organization’s eligibility for the ERC based upon aspects such as your market, profits, and operations. If you meet the requirements for the credit and determine the maximum credit amount you can claim, they can assist figure out.
Documentation and Computation: ERC filing services will help in gathering the essential paperwork, such as payroll records and monetary statements, to support your claim. They will also assist calculate the credit quantity based upon qualified earnings and other certifying expenditures.
Retroactive Claim Review: If you are qualified to declare the ERC for previous quarters, these companies can evaluate your past payroll records and financials to identify possible opportunities for retroactive credits. They can assist you change previous income tax return to claim these refunds.
Filing Help: Companies focusing on ERC filings will prepare and send the required kinds and paperwork on your behalf. This consists of finishing Type 941 or any other required tax forms.
Compliance and Updates: ERC guidelines and guidance have evolved in time. These companies remain upgraded with the most recent modifications and make sure that your filings abide by the most current guidelines. They can likewise offer continuous assistance if the internal revenue service requests additional information or carries out an audit related to your ERC claim.
It’s important to research and vet any business providing ERC filing support to guarantee their trustworthiness and know-how. Look for established firms with experience in tax and payroll services, or consider connecting to trusted accounting companies or tax specialists who use ERC submitting support.
Keep in mind that while these business can offer important help, it’s always a great concept to have a standard understanding of the ERC requirements and process yourself. This will help you make informed choices 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 steps. The goal of the ERC is to motivate services to maintain and pay their workers throughout the pandemic, even if their operations have been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is offered to qualified companies, consisting of for-profit organizations, tax-exempt organizations, and certain governmental entities. To certify, companies should satisfy one of two requirements:.
The business operations were completely or partially suspended due to a federal government order related to COVID-19.
The business experienced a substantial decrease in gross receipts. As pointed out previously, for 2021, a significant decline is defined as a 20% decrease in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a considerable decrease is defined as a 20% decrease in gross receipts compared to the same quarter in 2019, or a 20% decrease in gross receipts compared to the instantly preceding quarter.
Credit Amount: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit amount amounts to a percentage (approximately 70%) of certified salaries paid to workers, consisting of particular health insurance expenditures. 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: Initially, services that received a Paycheck Protection Program (PPP) loan were not qualified for the ERC. However, legislation passed in late 2020 and extended in 2021 allows organizations to claim the ERC even if they got a PPP loan. Nevertheless, 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 companies to claim the credit for certified earnings paid as far back as March 13, 2020. This retroactive arrangement provides an opportunity for organizations to amend prior-year income tax return and get refunds.
Declaring the Credit: Companies can declare the ERC by reporting it on their employment income tax return, normally Form 941. The excess can be refunded to the employer if the credit goes beyond the amount of work taxes owed.
It is essential to note that the ERC provisions and eligibility requirements have actually developed gradually. The best strategy is to seek advice from a tax professional or check out the official internal revenue service website for the most up-to-date and in-depth details concerning the ERC, including any current legal changes or updates.
To qualify for the ERC, a company should satisfy among the following requirements:.
Business operations were fully or partially suspended due to a federal government order related to COVID-19.
Business experienced a significant decline in gross invoices. For 2021, a substantial decline is specified as a 20% decline in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a considerable decrease is specified as a 20% decrease in gross invoices compared to the same quarter in 2019, or a 20% decrease in gross receipts compared to the immediately preceding quarter.
The ERC is readily available to organizations of all sizes, consisting of tax-exempt companies, however there are some exceptions. Federal government entities and services that got a PPP loan may have constraints on claiming the credit.
The procedure for claiming the ERC includes finishing the needed types and consisting of the credit on your work tax return (usually Type 941). The exact time it requires to process the credit can differ based upon a number of factors, including the complexity of your service and the work of the internal revenue service. It’s advised to consult with a tax professional for guidance particular to your scenario.
There are numerous companies that can assist with the process of claiming the ERC. Some popular business that use support with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the information offered here is based on general knowledge and might not reflect the most current updates or modifications to the ERC. It is essential to seek advice from a tax expert or visit the main internal revenue service website for the most accurate and current info relating to eligibility, claiming treatments, and offered help.
Less than 100. If the company had 100 or less staff members usually in 2019, then the credit is based.
on incomes paid to all workers whether they really worked or not. In other words, even if the.
employees 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 staff members on average in 2019.
enabled just for earnings paid to staff members who did not work during the calendar quarter.
In both cases, “wages” includes not just money payments but also a part of the expense of employer.
offered health care. Instructions For Employee Retention Credit
Companies can be instantly repaid for the credit by reducing the amount of payroll taxes they.