Lets talk first about Qualified Disaster Employee Retention Credit :
Our group here what do these men doing everyone in this room is assisting teach individuals about ERC and uh constantly supply a lovely breakfast and have individuals truly learn about the program we must head to the room where we have the ability to show a few of the checks that we are getting for business and I wish to see that what is this this is uh numerous millions of dollars actually Kevin hundreds of countless dollars so these are replicate copies of the letters that go to customers verifying that the check is on the method I suggest you understand if you simply 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 mean it’s just I imply think about how many real customers 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 internal revenue service heading to the client so that’s how you have the ability to track it you know when you
receive this you know the check is opted for sure and that’s when they pay so they don’t pay anything up until they really receive the money they do not pay bottom line Wonder trust anything until this letter is validated the check is on the method they deposit it into their savings account and they can really trust Wonder trust that the process has actually been completed and the number of you believe you’ve processed since you began this we have to do with 35 000 of these for
about 6 billion dollars wow so clearly 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 talking about something really important today the employee retention credit which the majority of you have actually never ever become aware of I definitely had not become aware of it up until really recently and discovered a lot about it because this is probably the most affordable cost of capital for any small business anywhere
anytime if you have employees between 5 and five hundred so I’ve got the expert with me this is Josh Fox he’s the creator and CEO of bottom line Concepts they’re the largest processor of these ERC credits this is a 170 page program so it’s challenging this isn’t like PPP we simply call your bank manager and say provide me a loan it does not work there’s not a loan it’s an application and Josh is going to tell us all about it and how to get it and why I’ve become yes the Ambassador and paid spokesperson for this I love 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 simply begin there so during the Trump Administration when President Trump was enacted they created the cares Act and the cares act provided organizations 3 chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and almost everybody it makes a huge distinction 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 alright go on sorry I just need to make certain we got that point I suggest that’s a huge difference a loan versus cash money I like money money that’s what we’re talking 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 real cash from the IRS all right so let’s talk about how it works since it sounds like to me if it’s a if it’s worker retention credit that individual had to be a staff member so I’m going to make the Presumption this cash is not for the owner not for individuals on the cap table not for investors it’s for workers right you had to have actually owned an organization however it’s based upon you having W-2 staff members in America not 10.99. so 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 first 6 months of 2021 on the W-2 right so there were six 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 2 and three of 2021. fine so that’s how it’s determined you have to be on the W-2 during that period now let’s talk my preferred part cash just how much can you return per staff member that was on a W-2 in those 6 quarters so the calculation in 2020 to be exact Kevin is 50 of the worker’s salary to a maximum of 5 thousand dollars per worker for the year of 2020 and in 2021 the numbers increased to 70 of the worker’s wage to an optimum of seven thousand per quarter how did that take place um they simply changed the rules in.
2021 versus because 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 up to five thousand Max and then 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 five thousand in twenty twenty that’s twenty six thousand dollars per staff member that is since that’s a great deal of cash it is now there’s a caution here the PPP money would need to be decreased from the twenty six thousand dollars so if you took PPP loan one and PPP loan two you would reduce the 26 000 so what we’re seeing on average Kevin is if you took PPP cash somewhere 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 IRS so it’s huge clearly now the big question is why does nobody know about this because look when I initially became aware of this when I initially fulfilled Josh you know I have actually got great deals of investments in lots of companies I’m a major advocate for entrepreneurship in America and make lots of lots of financial investments in entrepreneurs of which many suffered through the pandemic when I first became aware of this I called BS I don’t think 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 which were well should have and we used them sensibly to stay alive during the pandemic so when I found out about this I stated nah it can’t hold true but when I dug around I even called to my politician 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 info out there then a bunch of individuals told me well you can’t get it due to the fact that you took the PPP likewise not true so let’s ask Josh why does nobody know about the employee retention credit you understand what’s intriguing 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 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 chaos because keep in mind in the original cares act you might refrain from doing both programs so if you had done PPP you could not do ERC in the initial program and when they changed the law in 2021 the banks were not doing ERC because it’s not alone so you’re getting a tax refund so the government never made it clear to any person about how to.
do this does your CFO know how to do this not truly he or she’s never done it before 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 done this prior to unless you have an account that went into this business and bottom line my firm Kevin has been in business since 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 great deal of our huge big corporate clients have dealt with bottom line to recover other government programs we have actually done sales tax and utilize tax joblessness tax work chance 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 encourage.
companies to keep workers on their payroll. The credit is 50% of up to $10,000 in earnings paid by an.
Because of COVID-19 or whose gross invoices, employer whose company is completely or partly suspended.
decline by more than 50%.
1. The credit is available to all companies despite size consisting of tax exempt organizations. There are.
only two exceptions: (1) state and local governments and their instrumentalities and (2) small.
companies who take Small company Loans.
2. To qualify, the company needs to satisfy one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the employer’s organization is fully or partly 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 equivalent quarter in 2019. Once the.
employer’s gross invoices exceed 80% of a similar 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 earnings paid up to $10,000 in overall.
It is effective for salaries paid after March 13th and prior to December 31, 2020.
The meaning of qualifying salaries varies by whether an employer had, typically, more or less than.
100 workers in 2019.
Companies that specialize in ERC filing help typically supply knowledge and assistance to assist companies navigate the intricate process of claiming the credit. They can offer numerous services, consisting of:.
How is the employee retention credit calculated? Qualified Disaster Employee Retention Credit
Eligibility Evaluation: These business will assess your business’s eligibility for the ERC based on factors such as your market, earnings, and operations. They can assist determine if you meet the requirements for the credit and determine the maximum credit quantity you can declare.
Documentation and Computation: ERC filing services will assist in collecting the required paperwork, such as payroll records and financial declarations, to support your claim. They will also help calculate the credit amount based upon eligible salaries and other qualifying expenses.
Retroactive Claim Review: If you are eligible to claim the ERC for previous quarters, these business can examine your past payroll records and financials to identify prospective chances for retroactive credits. They can help you amend previous income tax return to declare these refunds.
Filing Assistance: Companies concentrating on ERC filings will prepare and send the essential types and documentation in your place. This includes completing Kind 941 or any other required tax return.
Compliance and Updates: ERC regulations and guidance have evolved in time. These companies remain updated with the current changes and ensure that your filings adhere to the most existing guidelines. If the Internal revenue service requests additional details or carries out an audit related to your ERC claim, they can also offer ongoing assistance.
It’s important to research study and vet any company providing ERC filing help to guarantee their reliability and competence. Try to find recognized firms with experience in tax and payroll services, or consider reaching out to trusted accounting firms or tax specialists who offer ERC filing assistance.
Bear in mind that while these business can supply valuable support, it’s constantly a good concept to have a basic understanding of the ERC requirements and procedure yourself. This will assist you make notified choices and make sure 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 encourage businesses to retain and pay their staff members during the pandemic, even if their operations have been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is offered to eligible employers, including for-profit services, tax-exempt organizations, and certain governmental entities. To qualify, companies need to fulfill one of two requirements:.
The business operations were completely or partially suspended due to a government order related to COVID-19.
Business experienced a significant decline in gross receipts. As discussed earlier, for 2021, a significant decrease is specified as a 20% decline in gross receipts compared to the 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% decrease in gross invoices compared to the right away preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the employer’s share of Social Security taxes. The credit amount is equal to a portion (as much as 70%) of certified salaries paid to staff members, including particular health insurance expenditures. 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 qualified for the ERC. Legislation passed in late 2020 and extended in 2021 allows companies to declare 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 Arrangement: The ERC has been retroactively expanded and improved, allowing qualified employers to declare the credit for qualified earnings paid as far back as March 13, 2020. This retroactive arrangement provides an opportunity for services to change prior-year tax returns and receive refunds.
Declaring the Credit: Companies can claim the ERC by reporting it on their employment income tax return, typically Type 941. The excess can be refunded to the company if the credit surpasses the quantity of employment taxes owed.
It’s important to note that the ERC arrangements and eligibility criteria have actually evolved with time. The best course of action is to seek advice from a tax expert or go to the official internal revenue service website for the most detailed and current information concerning the ERC, including any current legislative modifications or updates.
To get approved for the ERC, a business should fulfill among the following criteria:.
The business operations were completely or partly suspended due to a federal government order related to COVID-19.
Business experienced a substantial decrease in gross invoices. For 2021, a considerable decrease is specified as a 20% decrease in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a considerable decline 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.
The ERC is available to businesses of all sizes, consisting of tax-exempt organizations, however there are some exceptions. Federal government entities and organizations that received a PPP loan might have constraints on claiming the credit.
The procedure for claiming the ERC involves completing the needed forms and including the credit on your employment income tax return (generally Form 941). The exact time it requires to process the credit can vary based on numerous aspects, consisting of the complexity of your organization and the workload of the IRS. It’s recommended to speak with a tax expert for guidance particular to your circumstance.
There are numerous companies that can assist with the procedure of declaring the ERC. Some well-known companies that provide assistance with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the information offered here is based upon basic understanding and might not show the most recent updates or changes to the ERC. It is very important to consult with a tax professional or go to the main internal revenue service website for the most current and accurate information regarding eligibility, declaring treatments, and offered support.
Less than 100. The credit is based if the company had 100 or fewer staff members on average in 2019.
on incomes paid to all employees whether they actually worked or not. In other words, even if the.
employees worked full-time and got paid 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 just for earnings paid to workers who did not work during the calendar quarter.
In both cases, “incomes” consists of not simply cash payments but also a portion of the cost of employer.
supplied healthcare. Qualified Disaster Employee Retention Credit
Employers can be right away reimbursed for the credit by lowering the amount of payroll taxes they.