Lets talk first about Covid Related Employee Retention Credits :
Our group here what do these men doing everyone in this space is assisting teach people about ERC and uh always provide a lovely breakfast and have individuals truly learn more about the program we must head to the space where we are able 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 countless dollars literally Kevin numerous millions of dollars so these are duplicate copies of the letters that go to customers confirming that the check is on the way I indicate you understand if you just begin to take a look at some of these here I suggest this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I mean it’s simply I imply consider how many real clients that went through the program yeah this is the very end this is the party 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 customer so that’s how you’re able to track it you understand when you
receive this you know the check is gone for sure which’s when they pay so they don’t pay anything up until they actually receive the cash they do not pay bottom line Wonder trust anything till this letter is verified the check is on the method they transfer it into their checking account and they can truly trust Wonder trust that the procedure has been finished and the number of you think you have actually processed because you started this we’re about 35 000 of these for
about 6 billion dollars wow so plainly they know what they’re doing and that’s what you require 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 Wonderful here you’re at my YouTube channel we’re talking about something actually essential today the employee retention credit which the majority of you have never ever become aware of I certainly hadn’t heard of it until really just recently and learned a lot about it due to the fact that this is most likely the most affordable expense of capital for any small business anywhere
anytime if you have staff members between five and five hundred so I’ve got the specialist 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 contact 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 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 just begin there so during the Trump Administration when President Trump was enacted they created the cares Act and the cares act provided organizations three 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 2 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 simply have to make sure we got that point I suggest that’s a huge difference a loan versus cash money I like cash money that’s what we’re talking 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 initial cares Act is the ERC and yes Kevin it is a beautiful tough check in the mail where you get real money from the internal revenue service all right so let’s speak about how it works since it seems like to me if it’s a if it’s staff member retention credit that individual had to be a staff member so I’m going to make the Assumption this cash is not for the owner not for individuals on the cap table not for shareholders it’s for staff members right you needed 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 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 6 months of 2021 on the W-2 proper so there were 6 quarters the program was open well walk us through the six quarters so you had quarters 2 3 and 4 of 2020 and you had quarters one two and 3 of 2021. alright so that’s how it’s measured you have to be on the W-2 during that duration now let’s talk my favorite part cash how much can you return per staff member that was on a W-2 in those six quarters so the calculation in 2020 to be exact Kevin is 50 of the staff member’s wage to an optimum of five thousand dollars per staff member for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the worker’s salary to a maximum of seven thousand per quarter how did that occur um they just changed the rules in.
2021 versus since the mayhem 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 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 5 thousand in twenty twenty that’s twenty six thousand dollars per worker that is since that’s a lot of cash it is now there’s a caveat here the PPP money would need to be minimized 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 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 workers and you took PPP cash you would still get a million dollar in the mail from the IRS so it’s huge obviously now the big concern is why does nobody understand about this because appearance when I initially became aware of this when I initially satisfied Josh you know I have actually got lots of financial investments in lots of companies I’m a significant supporter for entrepreneurship in America and make many numerous investments in business owners of which numerous suffered through the pandemic when I first heard about this I called BS I do not believe it because 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 and that were well should have and we used them sensibly to survive throughout the pandemic so when I heard about this I stated nah it can’t be true however when I dug around I even called to my politician pals Guv Senators they didn’t know about it I imply that’s how you know that’s how false information is that there’s no details out there then a bunch of individuals informed me well you can’t get it due to the fact that you took the PPP likewise not real so let’s ask Josh why does no one know about the employee retention credit you understand what’s interesting you’re talking 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 procedure 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 due to the fact that keep in mind in the initial cares act you might refrain from doing both programs so if you had done PPP you could refrain from doing ERC in the initial program and when they altered the law in 2021 the banks were not doing ERC since it’s not alone so you’re getting a tax refund so the government never ever 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 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 business your accounting professional no your accountant’s never ever done this prior to unless you have an account that entered into this service and bottom line my company Kevin has actually stayed in business given that 2009 and we have actually been dealing with the federal government and the state federal government to recover cash for Fortune 500 Fortune 1000 companies so a great deal of our big big business clients have dealt with bottom line to recover other federal government programs we have actually done sales tax and use tax unemployment tax work opportunity 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 as much as $10,000 in earnings paid by an.
Due to the fact that of COVID-19 or whose gross receipts, company whose business is completely or partly suspended.
decline by more than 50%.
1. The credit is offered to all employers regardless of size including tax exempt organizations. There are.
only two exceptions: (1) state and city governments and their instrumentalities and (2) little.
services who take Small Business Loans.
2. To qualify, the employer has to meet one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the company’s company is fully or partially suspended by federal government order due to COVID-19.
throughout the calendar quarter or.
o the employer’s gross receipts are listed below 50% of the similar quarter in 2019. When the.
employer’s gross invoices exceed 80% of a comparable quarter in 2019 they no longer qualify.
after completion of that quarter.
Estimation of the Credit.
The amount of the credit is 50% of the qualifying earnings paid up to $10,000 in overall.
It is effective for earnings paid after March 13th and prior to December 31, 2020.
The meaning of qualifying wages varies by whether an employer had, on average, basically than.
100 employees in 2019.
Business that specialize in ERC filing help normally provide knowledge and support to assist companies navigate the complex procedure of declaring the credit. They can use various services, including:.
How is the employee retention credit calculated? Covid Related Employee Retention Credits
Eligibility Evaluation: These companies will assess your business’s eligibility for the ERC based upon factors such as your industry, income, and operations. They can assist figure out if you fulfill the requirements for the credit and identify the maximum credit amount you can claim.
Paperwork and Calculation: ERC filing services will assist in collecting the needed paperwork, such as payroll records and monetary declarations, to support your claim. They will likewise assist calculate the credit quantity based upon qualified wages and other qualifying expenses.
Retroactive Claim Review: If you are qualified to declare the ERC for previous quarters, these business can review your previous payroll records and financials to recognize possible chances for retroactive credits. They can assist you modify prior income tax return to declare these refunds.
Filing Assistance: Business specializing in ERC filings will prepare and submit the essential types and paperwork in your place. This includes completing Form 941 or any other necessary tax forms.
Compliance and Updates: ERC regulations and guidance have actually developed gradually. These companies stay upgraded with the current modifications and make sure that your filings adhere to the most present guidelines. They can likewise supply continuous assistance if the internal revenue service requests additional information or performs an audit related to your ERC claim.
It is essential to research study and vet any business offering ERC filing support to ensure their credibility and knowledge. Search for established companies with experience in tax and payroll services, or consider connecting to trusted accounting firms or tax experts who use ERC submitting assistance.
Bear in mind that while these business can provide valuable support, it’s constantly a good concept to have a fundamental understanding of the ERC requirements and procedure yourself. This will assist you make informed decisions and guarantee precise filings.
The Worker Retention Credit (ERC) is a refundable tax credit presented by the U.S. government as part of COVID-19 relief measures. The objective of the ERC is to encourage services 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 readily available to qualified employers, including for-profit organizations, tax-exempt companies, and certain governmental entities. To qualify, employers need to fulfill one of two requirements:.
Business operations were totally or partially suspended due to a federal government order related to COVID-19.
Business experienced a substantial decline in gross invoices. As discussed earlier, for 2021, a considerable decline is specified as a 20% decrease in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a substantial decline is defined as a 20% decrease in gross receipts compared to the same quarter in 2019, or a 20% decline 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 amounts to a percentage (as much as 70%) of certified incomes paid to employees, including particular health plan expenditures. The optimum credit per worker is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, services that got an Income Protection Program (PPP) loan were not qualified for the ERC. However, legislation passed in late 2020 and extended in 2021 allows companies to declare the ERC even if they received a PPP loan. However, the exact same incomes can not be utilized to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively expanded and boosted, permitting qualified employers to declare the credit for qualified incomes paid as far back as March 13, 2020. This retroactive provision offers a chance for services to modify prior-year income tax return and get refunds.
Claiming the Credit: Companies can declare the ERC by reporting it on their employment income tax return, normally Kind 941. If the credit surpasses the quantity of work taxes owed, the excess can be refunded to the company.
It is essential to note that the ERC provisions and eligibility criteria have progressed over time. The best course of action is to talk to a tax professional or check out the official IRS site for the most in-depth and updated information relating to the ERC, including any current legislative changes or updates.
To get approved for the ERC, a business needs to satisfy one of the following requirements:.
The business operations were totally or partially suspended due to a government order related to COVID-19.
The business experienced a significant decline 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 significant decline is defined as a 20% decline in gross receipts compared to the exact same quarter in 2019, or a 20% decrease in gross receipts compared to the instantly preceding quarter.
The ERC is available to services of all sizes, including tax-exempt organizations, but there are some exceptions. For example, federal government entities and businesses that got a PPP loan might have restrictions on declaring the credit.
The process for declaring the ERC includes completing the needed forms and consisting of the credit on your employment tax return (typically Form 941). The exact time it takes to process the credit can vary based on a number of factors, including the intricacy of your organization and the work of the IRS. It’s suggested to talk to a tax professional for assistance particular to your scenario.
There are several companies that can assist with the procedure of declaring the ERC. These include accounting firms, tax advisory services, and payroll service providers. Some well-known business that offer help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s a good idea to research and contact these companies directly to inquire about their costs and services.
Please note that the information provided here is based upon basic knowledge and may not show the most current updates or modifications to the ERC. It is necessary to seek advice from a tax professional or check out the main IRS site for the most updated and precise info relating to eligibility, claiming treatments, and available support.
Less than 100. If the company had 100 or fewer staff members usually in 2019, then the credit is based.
on incomes paid to all workers whether they in fact worked or not. Simply put, even if the.
staff members worked full-time and earned money for full-time work, the company still gets the credit.
Greater than 100. The credit is if the company had more than 100 workers on average in 2019.
permitted just for salaries paid to employees who did not work throughout the calendar quarter.
In both cases, “salaries” includes not simply cash payments however likewise a part of the expense of employer.
offered health care. Covid Related Employee Retention Credits
Employers can be immediately repaid for the credit by decreasing the amount of payroll taxes they.