Lets talk first about Is There A Deadline To Claim The Employee Retention Credit :
Our group here what do these men doing everyone in this space is helping teach people about ERC and uh constantly provide a gorgeous breakfast and have people truly discover the program we need to head to the room where we are able to show some 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 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 method I mean you understand if you just start to take a 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 think of the number of actual customers 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 validated and the check is on the mail in the mail from the internal revenue service heading to the customer so that’s how you have the ability to track it you understand when you
get this you know the check is gone for sure and that’s when they pay so they do not pay anything up until they really get the cash they do not pay bottom line Wonder trust anything up until 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 how many you believe you have actually processed because you started this we have to do with 35 000 of these for
about six billion dollars wow so plainly they understand what they’re doing which’s what you need you need 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 Terrific here you’re at my YouTube channel we’re speaking about something truly crucial today the staff member retention credit which the majority of you have 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 due to the fact that this is probably the most affordable cost of capital for any small business anywhere
anytime if you have employees in between 5 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 Principles they’re the largest processor of these ERC credits this is a 170 page program so it’s not easy this isn’t like PPP we just call up your bank manager and say provide me a loan it doesn’t 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 have actually ended up being yes the Ambassador and paid spokesperson for this I enjoy this program it’s going away soon you got to learn all 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 came up with the cares Act and the cares act provided businesses 3 opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and almost everybody it makes a huge difference right there two of them are loans and one’s a refund precisely so the ERC is a refund that’s.
correct the money cash payroll tax refund okay go on sorry I simply need to make sure we got that point I mean that’s a huge difference a loan versus money cash I like money cash that’s what we’re discussing 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 hard check in the mail where you get real money from the IRS all right so let’s discuss how it works since it sounds like to me if it’s a if it’s staff member retention credit that person had to be a staff member so I’m going to make the Presumption this cash is not for the owner not for people on the cap table not for shareholders it’s for employees right you needed 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 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 have to be on payroll for the first six months of 2021 on the W-2 correct so there were six quarters the program was open well walk us through the six quarters so you had quarters 2 3 and four 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 throughout that duration now let’s talk my preferred part cash just how much can you return per worker that was on a W-2 in those 6 quarters so the computation in 2020 to be exact Kevin is 50 of the worker’s income to a maximum of 5 thousand dollars per staff member for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the employee’s income to a maximum of 7 thousand per quarter how did that occur um they just changed the rules in.
2021 versus since the chaos of the pandemic so they wanted 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 then what happens 21 000 Max in 2021 oh that’s how you create twenty six thousand twenty one thousand to twenty twenty one plus five 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 need to be minimized from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan two you would decrease the 26 000 so what we’re seeing on average Kevin is if you took PPP money somewhere around 10 thousand dollars a person so let’s state 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 internal revenue service so it’s huge undoubtedly now the huge concern is why does nobody know about this due to the fact that look when I initially found out about this when I initially fulfilled Josh you know I have actually got lots of financial investments in lots of business I’m a major advocate for entrepreneurship in America and make numerous numerous financial investments in business owners of which many suffered through the pandemic when I initially became aware of this I called BS I do not believe it since I use the PPP we went through the cash center Banks to get it it was very 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 stay alive during the pandemic so when I became aware of this I stated nah it can’t be true but when I dug around I even called to my political leader friends Governor Senators they didn’t know about it I imply that’s how you know that’s how misinformation is that there’s no information out there then a lot of people informed 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 know about the employee retention credit you know what’s intriguing you’re speaking about the banks Kevin because in the PPP loan process the federal government made it very clear that if you desired a PPP loan you would call Wells Fargo Citibank Bank of America any of the huge 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 process process that’s all um and here there was chaos since keep in mind in the initial cares act you could 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 refraining from doing ERC because it’s not alone so you’re getting a tax refund so the federal government never made it clear to anyone about how to.
do this does your CFO know how to do this not truly she or he’s never ever done it previously do the banks do it nope the banks don’t do it the payroll companies yeah a few of them are doing it as a payroll business your accountant no your accountant’s never done this before unless you have an account that entered into this company and bottom line my firm Kevin has stayed in business because 2009 and we’ve been dealing with the federal government and the state government to recover money for Fortune 500 Fortune 1000 business so a lot of our big big corporate clients have actually worked with bottom line to recover other federal government programs we’ve done sales tax and use tax unemployment tax work opportunity tax credits research and development tax credits unclaimed property property 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 employees on their payroll. The credit is 50% of approximately $10,000 in salaries paid by an.
company whose business is totally or partly suspended because of COVID-19 or whose gross invoices.
decline by more than 50%.
1. The credit is available to all companies despite size consisting of tax exempt companies. There are.
only two exceptions: (1) state and local governments and their instrumentalities and (2) small.
services who take Small Business Loans.
2. To certify, the company has to meet 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 company’s gross receipts are listed below 50% of the equivalent quarter in 2019. Once the.
company’s gross receipts exceed 80% of a comparable quarter in 2019 they no longer certify.
after the end of that quarter.
Estimation of the Credit.
The quantity of the credit is 50% of the certifying incomes paid up to $10,000 in total.
It works for earnings paid after March 13th and prior to December 31, 2020.
The meaning of qualifying incomes differs by whether a company had, usually, more or less than.
100 employees in 2019.
Companies that focus on ERC filing support usually supply know-how and support to assist companies navigate the complex procedure of declaring the credit. They can provide various services, consisting of:.
How is the employee retention credit calculated? Is There A Deadline To Claim The Employee Retention Credit
Eligibility Evaluation: These business will examine your organization’s eligibility for the ERC based on elements such as your market, income, and operations. If you satisfy the requirements for the credit and determine the optimum credit quantity you can claim, they can help figure out.
Documentation and Computation: ERC filing services will assist in collecting the needed documentation, such as payroll records and financial statements, to support your claim. They will also help compute the credit quantity based upon qualified salaries and other certifying costs.
Retroactive Claim Review: If you are eligible to declare the ERC for prior quarters, these companies can evaluate your previous payroll records and financials to identify possible opportunities for retroactive credits. They can assist you change previous tax returns to declare these refunds.
Filing Assistance: Business concentrating on ERC filings will prepare and submit the needed kinds and paperwork on your behalf. This consists of finishing Type 941 or any other required tax forms.
Compliance and Updates: ERC policies and assistance have actually progressed over time. These business remain upgraded with the latest changes and ensure that your filings abide by the most existing guidelines. If the Internal revenue service requests extra details or conducts an audit associated to your ERC claim, they can also offer continuous assistance.
It is necessary to research study and veterinarian any company providing ERC filing assistance to guarantee their trustworthiness and expertise. Search for recognized companies with experience in tax and payroll services, or consider reaching out to relied on accounting companies or tax experts who use ERC filing support.
Bear in mind that while these business can supply valuable support, it’s constantly an excellent concept to have a standard understanding of the ERC requirements and procedure yourself. This will help you make informed decisions and make sure accurate filings.
The Staff Member 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 motivate companies to retain and pay their staff members during the pandemic, even if their operations have actually been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is offered to eligible employers, consisting of for-profit companies, tax-exempt organizations, and certain governmental entities. To certify, companies need to satisfy one of two requirements:.
The business operations were fully or partially suspended due to a federal government order related to COVID-19.
Business experienced a significant decline in gross receipts. As discussed previously, 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 significant decline is specified as a 20% decrease in gross invoices compared to the very same quarter in 2019, or a 20% decline in gross receipts compared to the instantly preceding quarter.
Credit Amount: The ERC is a refundable tax credit that offsets the employer’s share of Social Security taxes. The credit amount amounts to a percentage (up to 70%) of qualified earnings paid to staff members, 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 Security Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 allows services to claim the ERC even if they got a PPP loan. The same incomes can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively expanded and enhanced, permitting qualified companies to claim the credit for qualified salaries paid as far back as March 13, 2020. This retroactive arrangement offers an opportunity for organizations to amend prior-year income tax return and get refunds.
Declaring the Credit: Companies can claim the ERC by reporting it on their employment income tax return, generally Form 941. If the credit goes beyond the quantity of employment taxes owed, the excess can be reimbursed to the company.
It is necessary to keep in mind that the ERC provisions and eligibility criteria have developed with time. The best strategy is to consult with a tax professional or visit the official IRS site for the most up-to-date and in-depth info regarding the ERC, including any recent legislative modifications or updates.
To get approved for the ERC, an organization needs to satisfy among the following criteria:.
Business operations were totally or partly suspended due to a federal government order related to COVID-19.
Business experienced a significant decrease in gross receipts. For 2021, a substantial decline is specified as a 20% decrease in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a significant decline is defined as a 20% decline in gross invoices compared to the same quarter in 2019, or a 20% decline in gross invoices compared to the right away preceding quarter.
The ERC is available to organizations of all sizes, including tax-exempt organizations, but there are some exceptions. For instance, federal government entities and services that received a PPP loan may have constraints on declaring the credit.
The process for declaring the ERC includes finishing the needed forms and including the credit on your employment tax return (usually Type 941). The exact time it requires to process the credit can differ based on several factors, including the intricacy of your company and the work of the IRS. It’s suggested to speak with a tax professional for assistance particular to your scenario.
There are a number of business that can aid with the process of declaring the ERC. These consist of accounting firms, tax advisory services, and payroll service providers. Some popular companies that provide help with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s recommended to research study and contact these companies directly to ask about their costs and services.
Please keep in mind that the information supplied here is based on basic understanding and may not reflect the most current updates or modifications to the ERC. It is very important to consult with a tax expert or check out the main internal revenue service website for the most accurate and current info regarding eligibility, claiming procedures, and readily available support.
Less than 100. If the employer had 100 or less staff members typically in 2019, then the credit is based.
on wages paid to all workers whether they actually worked or not. To put it simply, even if the.
staff members worked full-time and got paid for full-time work, the employer still gets the credit.
Greater than 100. If the company had more than 100 employees on average in 2019, then the credit is.
enabled only for earnings paid to employees who did not work during the calendar quarter.
In both cases, “earnings” includes not simply money payments however also a part of the expense of employer.
provided health care. Is There A Deadline To Claim The Employee Retention Credit
Employers can be right away reimbursed for the credit by lowering the quantity of payroll taxes they.