Lets talk first about When Will I Receive Employee Retention Credit :
Our group here what do these people doing everyone in this space is helping teach individuals about ERC and uh constantly provide a gorgeous breakfast and have people really learn more about the program we should head to the room where we have the ability to show some of the checks that we are getting for companies and I ‘d like to see that what is this this is uh numerous millions of dollars actually Kevin hundreds of millions of dollars so these are replicate copies of the letters that go to customers verifying that the check is on the method I suggest you know if you simply start 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 indicate it’s just I imply consider the number of real 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 validated and the check is on the mail in the mail from the IRS heading to the client so that’s how you have the ability to track it you understand when you
receive this you understand the check is gone for sure which’s when they pay so they do not pay anything till they actually get the cash they don’t pay bottom line Wonder trust anything until this letter is validated the check is on the method they transfer it into their savings account and they can really trust Wonder trust that the procedure has actually been finished and how many you believe you’ve processed since you began 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 require you require professionals 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 Wonderful here you’re at my YouTube channel we’re talking about something actually essential today the worker retention credit which most of you have actually never heard of I definitely hadn’t become aware of it till extremely recently and learned a lot about it because this is most likely the most affordable cost of capital for any small company anywhere
anytime if you have workers in between five 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 biggest processor of these ERC credits this is a 170 page program so it’s not easy this isn’t like PPP we simply call your bank supervisor and say give me a loan it doesn’t work there’s not a loan it’s an application and Josh is going to inform all of us 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 going away very soon you got to find out all about it let’s talk employee retention credit Josh Fox what is an ERC let’s just begin there so throughout the Trump Administration when President Trump was enacted they came up with the cares Act and the cares act offered companies 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.
remedy the cash cash payroll tax refund fine go on sorry I simply need to make certain we got that point I indicate that’s a huge difference a loan versus cash money I like cash 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 initial cares Act is the ERC and yes Kevin it is a beautiful tough check in the mail where you get actual money from the internal revenue service all right so let’s discuss how it works due to the fact that it sounds like to me if it’s a if it’s employee retention credit that individual needed to be a staff member so I’m going to make the Assumption this money is not for the owner not for people on the cap table not for shareholders it’s for workers right you had to have owned a business however it’s based on you having W-2 workers 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 eligible 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 six quarters the program was open well stroll us through the 6 quarters so you had quarters two three and 4 of 2020 and you had quarters one 2 and three of 2021. fine so that’s how it’s measured you have to be on the W-2 throughout that period now let’s talk my favorite part cash how much can you return per employee that was on a W-2 in those six quarters so the estimation in 2020 to be specific Kevin is 50 of the staff member’s income to a maximum of 5 thousand dollars per employee for the year of 2020 and in 2021 the numbers escalated to 70 of the worker’s salary to an optimum of 7 thousand per quarter how did that happen um they just altered the rules in.
2021 versus because the turmoil 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 as much as five thousand Max and then what takes place 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 cash it is now there’s a caveat here the PPP cash would have to be decreased 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 cash somewhere around 10 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 employees and you took PPP money you would still get a million dollar in the mail from the internal revenue service so it’s big undoubtedly now the huge question is why does no one learn about this due to the fact that look when I initially found out about this when I first met Josh you know I’ve got great deals of financial investments in lots of companies I’m a significant supporter for entrepreneurship in America and make lots of lots of financial investments in entrepreneurs of which many suffered through the pandemic when I first found out about this I called BS I don’t believe it because 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 deserved and we utilized them carefully to survive during the pandemic so when I heard about this I stated nah it can’t hold true but when I dug around I even called to my politician buddies Governor 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 lot of people told me well you can’t get it since you took the PPP likewise not real so let’s ask Josh why does no one understand about the staff member retention credit you know what’s interesting you’re talking about the banks Kevin due to the fact that in the PPP loan procedure the federal government made it extremely 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 turmoil since remember in the initial cares act you could refrain from doing both programs so if you had done PPP you might not do ERC in the initial program and when they altered the law in 2021 the banks were refraining from doing ERC due to the fact that it’s not alone so you’re getting a tax refund so the federal government never 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 in the past 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 ever done this before unless you have an account that went into this service and bottom line my company Kevin has actually been in business because 2009 and we’ve been dealing with the federal government and the state government to recover cash for Fortune 500 Fortune 1000 business so a great deal of our big big corporate customers have dealt with bottom line to recuperate other federal government programs we have actually done sales tax and use tax joblessness tax work chance tax credits research and development tax credits unclaimed home real estate tax all of these other government programs.
The staff member 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 wages paid by an.
Due to the fact that of COVID-19 or whose gross invoices, company whose business is fully or partially suspended.
decline by more than 50%.
1. The credit is readily available to all companies regardless of size including tax exempt companies. There are.
just two exceptions: (1) state and city governments and their instrumentalities and (2) small.
services who take Small Business Loans.
2. To certify, the employer needs to meet one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the employer’s service is fully or partly suspended by federal government order due to COVID-19.
throughout the calendar quarter or.
o the employer’s gross receipts are below 50% of the comparable quarter in 2019. When the.
company’s gross receipts exceed 80% of a similar quarter in 2019 they no longer certify.
after the end of that quarter.
Computation of the Credit.
The quantity of the credit is 50% of the qualifying earnings paid up to $10,000 in total.
It is effective for wages paid after March 13th and prior to December 31, 2020.
The definition of qualifying incomes varies by whether an employer had, usually, more or less than.
100 workers in 2019.
Business that specialize in ERC filing help generally provide expertise and assistance to assist businesses browse the complex process of claiming the credit. They can provide numerous services, including:.
How is the employee retention credit calculated? When Will I Receive Employee Retention Credit
Eligibility Assessment: These business will assess your organization’s eligibility for the ERC based upon aspects such as your market, income, and operations. If you fulfill the requirements for the credit and determine the maximum credit amount you can claim, they can help figure out.
Documents and Calculation: ERC filing services will assist in gathering the needed documentation, such as payroll records and financial statements, to support your claim. They will also assist compute the credit amount based upon 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 identify prospective opportunities for retroactive credits. They can help you modify previous income tax return to declare these refunds.
Filing Assistance: Business concentrating on ERC filings will prepare and submit the needed forms and paperwork in your place. This includes finishing Type 941 or any other required tax forms.
Compliance and Updates: ERC policies and assistance have actually progressed gradually. These companies stay updated with the most recent modifications and make sure that your filings adhere to the most present guidelines. They can likewise offer continuous assistance if the IRS demands additional info or conducts an audit related to your ERC claim.
It is very important to research study and veterinarian any business providing ERC filing help to guarantee their credibility and know-how. Look for recognized firms with experience in tax and payroll services, or consider connecting to trusted accounting companies or tax professionals who offer ERC filing assistance.
Bear in mind that while these companies can supply valuable assistance, it’s constantly an excellent idea to have a basic understanding of the ERC requirements and process yourself. This will assist you make informed choices and make sure precise filings.
The Staff Member 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 employees during the pandemic, even if their operations have actually been affected.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is readily available to qualified companies, consisting of for-profit organizations, tax-exempt companies, and specific governmental entities. To qualify, employers must meet one of two requirements:.
Business operations were totally or partly suspended due to a federal government order related to COVID-19.
The business experienced a significant decline in gross receipts. As mentioned previously, for 2021, a considerable decline is specified as a 20% decline in gross receipts 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 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 (up to 70%) of qualified salaries paid to staff members, consisting of certain health insurance costs. The optimum credit per employee is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, services that received an Income Defense Program (PPP) loan were not eligible for the ERC. However, legislation passed in late 2020 and extended in 2021 permits companies to declare the ERC even if they received a PPP loan. Nevertheless, the same earnings can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively expanded and improved, allowing qualified employers to claim the credit for qualified wages paid as far back as March 13, 2020. This retroactive provision supplies a chance for services to modify prior-year tax returns and receive refunds.
Claiming the Credit: Companies can claim the ERC by reporting it on their work income tax return, typically Form 941. If the credit exceeds the quantity of employment taxes owed, the excess can be reimbursed to the employer.
It is essential to note that the ERC arrangements and eligibility criteria have developed with time. The very best strategy is to seek advice from a tax expert or go to the official internal revenue service site for the most detailed and updated details relating to the ERC, consisting of any recent legal modifications or updates.
To qualify for the ERC, an organization must satisfy one of the following criteria:.
Business operations were totally or partly suspended due to a government order related to COVID-19.
Business experienced a substantial decline in gross receipts. For 2021, a substantial decrease is defined as a 20% decline in gross invoices compared to the 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% decrease in gross invoices compared to the instantly preceding quarter.
The ERC is available to organizations of all sizes, consisting of tax-exempt organizations, but there are some exceptions. Government entities and companies that got a PPP loan might have constraints on declaring the credit.
The process for declaring the ERC includes finishing the required forms and including the credit on your employment income tax return (typically Kind 941). The exact time it takes to process the credit can differ based on numerous factors, consisting of the intricacy of your business and the work of the IRS. It’s suggested to speak with a tax professional for guidance specific to your circumstance.
There are numerous business that can help with the process of claiming the ERC. Some well-known companies that provide support with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the information provided here is based on basic knowledge and may not reflect the most current updates or modifications to the ERC. It’s important to seek advice from a tax professional or check out the official internal revenue service website for the most precise and current details regarding eligibility, declaring treatments, and readily available support.
Less than 100. If the employer had 100 or fewer employees on average in 2019, then the credit is based.
on earnings paid to all workers whether they really worked or not. In other words, even if the.
workers worked full time and got paid for full-time work, the company still gets the credit.
Greater than 100. If the employer had more than 100 employees on average in 2019, then the credit is.
permitted just for incomes paid to workers who did not work during the calendar quarter.
In both cases, “salaries” includes not simply cash payments however also a portion of the cost of company.
offered health care. When Will I Receive Employee Retention Credit
Employers can be instantly compensated for the credit by decreasing the quantity of payroll taxes they.