Lets talk first about Employee Retention Credit 2021 Third Quarter :
Our group here what do these men doing everyone in this space is assisting teach people about ERC and uh always offer a lovely breakfast and have people really learn more about the program we should head to the space where we have the ability to show a few of the checks that we are getting for business and I ‘d like to see that what is this this is uh hundreds of millions of dollars literally Kevin numerous countless dollars so these are duplicate copies of the letters that go to customers verifying that the check is on the way I mean you understand if you just begin to take a look at a few of these here I suggest this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I suggest it’s simply I imply think of 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 verified the numbers are validated and the check is on the mail in the mail from the IRS heading to the consumer so that’s how you have the ability to track it you know when you
get this you understand the check is gone for sure which’s when they pay so they don’t pay anything till they really get the cash they don’t pay bottom line Wonder trust anything until this letter is validated the check is on the way they deposit it into their checking account and they can genuinely rely on Wonder trust that the procedure has actually been ended up and the number of you think you have actually processed since you started this we have to do with 35 000 of these for
about 6 billion dollars wow so clearly they know what they’re doing and that’s what you need you need specialists 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 talking about something really important today the staff member retention credit which the majority of you have actually never ever become aware of I certainly hadn’t become aware of it until very recently and learned a lot about it because this is most likely the lowest expense of capital for any small business 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 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 simply call your bank supervisor and state 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 very soon you got to learn all about it let’s talk employee retention credit Josh Fox what is an ERC let’s just start there so throughout 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 practically everyone it makes a big distinction right there 2 of them are loans and one’s a refund exactly so the ERC is a refund that’s.
correct the money money payroll tax refund all right go on sorry I simply need to make certain we got that point I mean that’s a huge distinction a loan versus money money 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 initial cares Act is the ERC and yes Kevin it is a stunning difficult check in the mail where you get actual cash from the internal revenue service all right so let’s discuss how it works since it seems like to me if it’s a if it’s staff member retention credit that individual needed to be an employee so I’m going to make the Presumption this cash is not for the owner not for individuals on the cap table not for shareholders it’s for employees right you needed to have actually owned a business but it’s based on you having W-2 staff members 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 qualified so you have to be on payroll in 2020 on the W-2 and you have to be on payroll for the very first 6 months of 2021 on the W-2 appropriate so there were 6 quarters the program was open well stroll us through the six quarters so you had quarters two three and 4 of 2020 and you had quarters one two and three of 2021. alright so that’s how it’s determined you have to be on the W-2 during that period now let’s talk my favorite part money 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 precise 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 increased to 70 of the staff member’s wage to a maximum of 7 thousand per quarter how did that happen um they simply altered the rules in.
2021 versus because the mayhem of the pandemic so they wished to even get more to keep those staff members 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 after that what happens 21 000 Max in 2021 oh that’s how you come up with twenty 6 thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty 6 thousand dollars per employee that is since that’s a lot of cash it is now there’s a caution here the PPP cash would need to be lowered from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan 2 you would decrease the 26 000 so what we’re seeing usually Kevin is if you took PPP cash somewhere around 10 thousand dollars an individual so let’s state hypothetically you owned a dining establishment 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 substantial undoubtedly now the big concern is why does no one understand about this since look when I first found out about this when I initially met Josh you understand I have actually got lots of investments in lots of business I’m a major advocate for entrepreneurship in America and make numerous lots of financial investments in business owners of which lots of suffered through the pandemic when I first found out about this I called BS I don’t think it since I use the PPP we went through the money 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 utilized them wisely to stay alive throughout the pandemic so when I found out about this I stated nah it can’t be true however when I dug around I even called to my politician good friends Guv Senators they didn’t learn about it I mean that’s how you know that’s how false information is that there’s no info out there then a lot of individuals informed me well you can’t get it since you took the PPP likewise not true so let’s ask Josh why does no one understand about the worker retention credit you know what’s fascinating you’re talking about the banks Kevin since in the PPP loan process the federal government made it really clear that if you wanted a PPP loan you would call Wells Fargo Citibank Bank of America any of the big 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 procedure process that’s all um and here there was turmoil since remember in the initial cares act you might refrain from doing both programs so if you had actually done PPP you might not do ERC in the original program and when they changed the law in 2021 the banks were refraining from doing ERC since it’s not alone so you’re getting a tax refund so the federal government never ever made it clear to anybody about how to.
do this does your CFO know how to do this not really she or he’s never done it previously 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 business your accountant no your accountant’s never ever done this before unless you have an account that went into this company 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 government to recuperate cash for Fortune 500 Fortune 1000 companies so a great deal of our big huge corporate customers have actually dealt with bottom line to recuperate 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 worker retention tax credit is a broad based refundable tax credit designed to encourage.
companies to keep workers on their payroll. The credit is 50% of as much as $10,000 in earnings paid by an.
Since of COVID-19 or whose gross receipts, company whose company is totally or partially suspended.
decline by more than 50%.
1. The credit is available to all employers no matter size consisting of tax exempt companies. There are.
just two exceptions: (1) state and city governments and their instrumentalities and (2) little.
businesses who take Small company Loans.
2. To certify, the employer has to satisfy one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the employer’s service is completely or partially suspended by government order due to COVID-19.
during the calendar quarter or.
o the company’s gross receipts are below 50% of the similar quarter in 2019. Once the.
company’s gross invoices go above 80% of a comparable quarter in 2019 they no longer qualify.
after the end of that quarter.
Computation of the Credit.
The quantity of the credit is 50% of the certifying wages paid up to $10,000 in overall.
It works for incomes paid after March 13th and before December 31, 2020.
The meaning of certifying incomes differs by whether a company had, on average, more or less than.
100 employees in 2019.
Companies that specialize in ERC filing assistance normally offer expertise and support to assist services navigate the complex process of declaring the credit. They can provide numerous services, including:.
How is the employee retention credit calculated? Employee Retention Credit 2021 Third Quarter
Eligibility Assessment: These companies will assess your business’s eligibility for the ERC based upon factors such as your market, profits, and operations. They can assist determine if you fulfill the requirements for the credit and identify the optimum credit quantity you can declare.
Documents and Calculation: ERC filing services will help in collecting the essential documents, such as payroll records and financial declarations, to support your claim. They will likewise assist compute the credit amount based upon eligible incomes and other certifying expenses.
Retroactive Claim Review: If you are eligible to claim the ERC for previous quarters, these business can review your past payroll records and financials to identify possible opportunities for retroactive credits. They can help you change previous income tax return to claim these refunds.
Filing Assistance: Companies specializing in ERC filings will prepare and send the necessary types and paperwork in your place. This consists of completing Type 941 or any other necessary tax forms.
Compliance and Updates: ERC policies and guidance have actually evolved in time. These business stay upgraded with the most recent changes and guarantee that your filings adhere to the most current guidelines. If the IRS demands extra info or performs an audit related to your ERC claim, they can also supply ongoing assistance.
It’s important to research and vet any business using ERC filing support to guarantee their trustworthiness and proficiency. Search for recognized firms with experience in tax and payroll services, or consider connecting to relied on accounting firms or tax experts who offer ERC submitting assistance.
Remember that while these business can offer important assistance, it’s constantly a great idea to have a fundamental understanding of the ERC requirements and procedure yourself. This will help you make notified decisions and ensure accurate filings.
The Employee 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 organizations to keep and pay their employees during the pandemic, even if their operations have actually been impacted.
Here are some key points about the ERC:.
Eligibility: The ERC is offered to qualified companies, including for-profit companies, tax-exempt organizations, and certain governmental entities. To qualify, employers need to fulfill one of two criteria:.
The business operations were fully or partly suspended due to a government order related to COVID-19.
The business experienced a significant decrease in gross invoices. As discussed previously, for 2021, a significant decrease is defined as a 20% decrease in gross invoices 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 immediately preceding quarter.
Credit Amount: 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 (up to 70%) of qualified incomes paid to staff members, consisting of particular health insurance costs. The maximum credit per staff member is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: At first, services that received a Paycheck Protection Program (PPP) loan were not eligible for the ERC. However, legislation passed in late 2020 and extended in 2021 enables services to claim the ERC even if they received a PPP loan. The same salaries can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has actually been retroactively expanded and enhanced, permitting qualified employers to declare the credit for qualified earnings paid as far back as March 13, 2020. This retroactive arrangement provides a chance for organizations to change prior-year income tax return and get refunds.
Claiming the Credit: Companies can claim the ERC by reporting it on their work tax returns, usually Form 941. If the credit goes beyond the amount of employment taxes owed, the excess can be reimbursed to the employer.
It is very important to note that the ERC arrangements and eligibility requirements have progressed in time. The very best strategy is to speak with a tax expert or visit the main IRS website for the most current and in-depth info relating to the ERC, including any recent legal changes or updates.
To receive the ERC, a company must satisfy one of the following requirements:.
Business operations were totally or partly suspended due to a government order related to COVID-19.
Business experienced a considerable decrease in gross receipts. For 2021, a significant decline is specified as a 20% decline in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a substantial decrease is defined as a 20% decrease 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 offered to businesses of all sizes, including tax-exempt companies, however there are some exceptions. Federal government entities and organizations that got a PPP loan may have restrictions on declaring the credit.
The process for declaring the ERC includes completing the necessary types and consisting of the credit on your work income tax return (typically Type 941). The exact time it requires to process the credit can vary based on numerous aspects, consisting of the intricacy of your organization and the work of the internal revenue service. It’s advised to consult with a tax expert for guidance particular to your scenario.
There are numerous business that can aid with the procedure of claiming the ERC. These include accounting firms, tax advisory services, and payroll company. Some well-known companies that offer assistance with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s advisable to research study and call these business straight to ask about their services and fees.
Please keep in mind that the info provided here is based upon basic knowledge and might not reflect the most current updates or modifications to the ERC. It is very important to seek advice from a tax expert or visit the main IRS site for the most precise and up-to-date info relating to eligibility, declaring procedures, and available help.
Less than 100. If the employer had 100 or less employees typically in 2019, then the credit is based.
on incomes paid to all staff members whether they actually worked or not. Simply put, even if the.
workers 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 only for wages paid to employees who did not work throughout the calendar quarter.
In both cases, “wages” includes not simply money payments however likewise a portion of the expense of employer.
supplied health care. Employee Retention Credit 2021 Third Quarter
Companies can be instantly compensated for the credit by decreasing the amount of payroll taxes they.