Lets talk first about Employee Retention Credit 2021 3Rd Quarter :
Our team here what do these people doing everyone in this room is assisting teach people about ERC and uh constantly offer a lovely breakfast and have individuals really learn about the program we must head to the space where we are able to show some of the checks that we are getting for business and I want to see that what is this this is uh hundreds of countless dollars actually Kevin hundreds of millions of dollars so these are replicate copies of the letters that go to clients confirming that the check is on the method I suggest you understand if you simply begin 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 suggest it’s just I suggest think about the number of actual 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 client 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 until they really receive the money they do not pay bottom line Wonder trust anything until this letter is confirmed the check is on the way they transfer it into their savings account and they can really trust Wonder trust that the process has been finished and how many you believe you’ve processed given that you started this we have to do with 35 000 of these for
about six billion dollars wow so clearly they understand what they’re doing and that’s what you require you need experts 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 Terrific here you’re at my YouTube channel we’re speaking about something actually important today the staff member retention credit which most of you have never ever heard of I certainly had not become aware of it till really just recently and found out a lot about it since this is most likely the lowest cost of capital for any small company anywhere
anytime if you have staff members between 5 and five hundred so I have actually got the professional with me this is Josh Fox he’s the creator and CEO of bottom line Ideas they’re the largest processor of these ERC credits this is a 170 page program so it’s difficult this isn’t like PPP we just phone your bank supervisor and state provide me a loan it does not 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 ended up being yes the Ambassador and paid representative for this I love this program it’s going away 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 during the Trump Administration when President Trump was enacted they came up with 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 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.
remedy the cash cash payroll tax refund alright go on sorry I simply have to make certain we got that point I imply that’s a big difference a loan versus money money I like money money that’s what we’re speaking 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 real money from the internal revenue service 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 person had to be an employee so I’m going to make the Presumption 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 actually owned an organization however it’s based upon you having W-2 employees in America not 10.99. 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 have to be on payroll for the first 6 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 two 3 and four of 2020 and you had quarters one two and 3 of 2021. all right so that’s how it’s determined you need to be on the W-2 throughout that duration now let’s talk my favorite part money how much can you get back per employee that was on a W-2 in those 6 quarters so the calculation in 2020 to be specific Kevin is 50 of the employee’s wage to a maximum of five thousand dollars per staff member for the year of 2020 and in 2021 the numbers escalated to 70 of the staff member’s wage to an optimum of seven thousand per quarter how did that take place um they just changed the rules in.
2021 versus because 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 up to 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 staff member that is because that’s a great deal of money it is now there’s a caution here the PPP money would have to be decreased from the twenty 6 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 money somewhere around ten 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 staff members and you took PPP cash you would still get a million dollar in the mail from the IRS so it’s substantial undoubtedly now the big question is why does nobody understand about this because look when I initially became aware of this when I initially met Josh you understand I have actually got great deals of financial investments in lots of companies I’m a major supporter for entrepreneurship in America and make numerous many financial investments in entrepreneurs of which lots of suffered through the pandemic when I first became aware of this I called BS I don’t believe it since I utilize the PPP we went through the cash center Banks to get it it was really easy to do we had our CEOs call the banks they got their loans which were well should have and we utilized them sensibly to stay alive throughout the pandemic so when I found out about this I stated nah it can’t be true but when I dug around I even called to my political leader buddies Guv Senators they didn’t learn about it I imply that’s how you understand that’s how false information is that there’s no information out there then a bunch of people told me well you can’t get it because you took the PPP also not real so let’s ask Josh why does nobody know about the employee retention credit you understand what’s fascinating 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 just procedure process that’s all um and here there was mayhem due to the fact that keep in mind in the original cares act you might 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 federal government never made it clear to anybody about how to.
do this does your CFO know how to do this not really he or she’s never done it in the past do the banks do it nope the banks do not do it the payroll companies yeah a few of them are doing it as a payroll company your accountant no your accounting professional’s never done this before unless you have an account that went into this business and bottom line my firm Kevin has stayed in business considering that 2009 and we have actually been working with the federal government and the state federal government to recuperate cash for Fortune 500 Fortune 1000 companies so a lot of our huge big business customers have worked with bottom line to recuperate other federal government programs we’ve done sales tax and use tax unemployment tax work chance tax credits research and development tax credits unclaimed property property tax all of these other federal government programs.
The employee retention tax credit is a broad based refundable tax credit developed to encourage.
companies to keep employees on their payroll. The credit is 50% of approximately $10,000 in earnings paid by an.
Since of COVID-19 or whose gross invoices, employer whose company is completely or partially suspended.
decline by more than 50%.
Availability.
1. The credit is available to all employers despite size consisting of tax exempt organizations. There are.
only two exceptions: (1) state and city governments and their instrumentalities and (2) small.
businesses who take Small Business Loans.
2. To qualify, the company has to satisfy one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the company’s organization is totally or partially suspended by federal government order due to COVID-19.
during the calendar quarter or.
o the company’s gross receipts are below 50% of the equivalent quarter in 2019. When the.
employer’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 amount of the credit is 50% of the certifying incomes paid up to $10,000 in overall.
It is effective for wages paid after March 13th and prior to December 31, 2020.
The meaning of qualifying wages varies by whether an employer had, usually, more or less than.
100 workers in 2019.
Companies that specialize in ERC filing support normally offer knowledge and support to assist organizations browse the complicated procedure of claiming the credit. They can provide numerous services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit 2021 3Rd Quarter
Eligibility Evaluation: These companies will assess your organization’s eligibility for the ERC based upon aspects such as your market, revenue, and operations. If you satisfy the requirements for the credit and identify the maximum credit quantity you can claim, they can assist determine.
Paperwork and Computation: ERC filing services will assist in collecting the essential documentation, such as payroll records and monetary declarations, to support your claim. They will likewise assist calculate the credit amount based on eligible salaries and other certifying costs.
Retroactive Claim Review: If you are qualified to claim the ERC for previous quarters, these companies can review your past payroll records and financials to identify potential chances for retroactive credits. They can help you change prior tax returns to declare these refunds.
Filing Support: Companies specializing in ERC filings will prepare and send the essential kinds and paperwork on your behalf. This consists of completing Kind 941 or any other necessary tax return.
Compliance and Updates: ERC policies and assistance have actually evolved in time. These companies remain upgraded with the latest modifications and make sure that your filings comply with the most present standards. If the IRS demands extra information or performs an audit associated to your ERC claim, they can likewise offer continuous assistance.
It’s important to research study and veterinarian any business using ERC filing help to guarantee their trustworthiness and expertise. Try to find recognized firms with experience in tax and payroll services, or think about reaching out to relied on accounting firms or tax specialists who offer ERC filing support.
Bear in mind that while these companies can provide important support, it’s always a great concept to have a basic understanding of the ERC requirements and process yourself. This will assist you make informed choices and guarantee precise filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit introduced by the U.S. federal government as part of COVID-19 relief procedures. The goal of the ERC is to encourage businesses to retain and pay their staff members throughout the pandemic, even if their operations have actually been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is offered to eligible companies, including for-profit businesses, tax-exempt companies, and specific governmental entities. To qualify, companies need to fulfill one of two criteria:.
The business operations were completely or partially suspended due to a federal government order related to COVID-19.
The business experienced a significant decline in gross invoices. As discussed previously, for 2021, a substantial decline is defined as a 20% decline in gross invoices compared to the exact 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 invoices compared to the right away preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit amount is equal to a portion (as much as 70%) of certified salaries paid to employees, including particular health insurance expenses. The maximum credit per employee is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, companies that got a Paycheck Protection Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 permits businesses to claim the ERC even if they received a PPP loan. The exact same salaries can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively expanded and enhanced, permitting qualified companies to claim the credit for qualified earnings paid as far back as March 13, 2020. This retroactive arrangement supplies an opportunity for businesses to modify prior-year income tax return and receive refunds.
Claiming the Credit: Employers can claim the ERC by reporting it on their employment tax returns, typically Form 941. The excess can be refunded to the company if the credit goes beyond the amount of work taxes owed.
It is essential to note that the ERC provisions and eligibility criteria have evolved with time. The very best strategy is to speak with a tax professional or check out the official IRS site for the most in-depth and up-to-date details concerning the ERC, including any recent legal changes or updates.
To qualify for the ERC, a company needs to satisfy one of 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 invoices. For 2021, a significant decrease is specified as a 20% decrease in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a significant decrease is specified as a 20% decline in gross receipts 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, including tax-exempt organizations, however there are some exceptions. Government entities and companies that received a PPP loan may have constraints on declaring the credit.
The procedure for claiming the ERC involves completing the necessary types and including the credit on your employment income tax return (generally Kind 941). The exact time it requires to process the credit can vary based upon numerous elements, consisting of the complexity of your business and the workload of the internal revenue service. It’s advised to seek advice from a tax professional for guidance particular to your situation.
There are numerous business that can assist with the process of declaring the ERC. Some popular companies that offer help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the info supplied here is based upon general knowledge and might not reflect the most recent updates or modifications to the ERC. It is necessary to speak with a tax professional or go to the official IRS site for the most precise and up-to-date information regarding eligibility, claiming treatments, and offered help.
Less than 100. If the employer had 100 or fewer workers on average in 2019, then the credit is based.
on salaries paid to all staff members whether they actually worked or not. To put it simply, even if the.
workers worked full-time and earned money 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.
permitted just for wages paid to staff members who did not work throughout the calendar quarter.
In both cases, “earnings” consists of not just cash payments but also a portion of the expense of company.
supplied health care. Employee Retention Credit 2021 3Rd Quarter
Payment.
Companies can be immediately compensated for the credit by decreasing the quantity of payroll taxes they.