Lets talk first about Employee Retention Credit And Ppp Loan :
Our team here what do these guys doing everybody in this room is assisting teach individuals about ERC and uh always supply a gorgeous breakfast and have people truly find out about the program we must head to the space where we have the ability to show some of the checks that we are getting for companies and I wish 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 confirming that the check is on the way I mean you know if you just begin to 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 indicate it’s just I suggest consider how many actual clients that went through the program yeah this is the very end this is the party at the end when the check is validated the numbers are verified 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 understand the check is opted 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 up until this letter is verified the check is on the way they transfer it into their checking account and they can really rely on Wonder trust that the procedure has been completed and the number of you think you’ve processed since you started this we’re about 35 000 of these for
about six billion dollars wow so clearly they understand what they’re doing which’s what you require you need 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 Terrific here you’re at my YouTube channel we’re discussing something actually essential today the worker retention credit which most of you have never become aware of I definitely had not heard of it till extremely just recently and learned a lot about it since this is most likely the most affordable expense of capital for any small company anywhere
anytime if you have employees between 5 and five hundred so I’ve got the specialist 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 hard this isn’t like PPP we simply phone your bank manager 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’ve become yes the Ambassador and paid spokesperson for this I like this program it’s going away very soon you got to discover everything 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 created the cares Act and the cares act provided businesses three opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically everybody it makes a big distinction right there 2 of them are loans and one’s a refund precisely so the ERC is a refund that’s.
fix the money money payroll tax refund okay go on sorry I just have to make certain we got that point I suggest that’s a big difference a loan versus money cash I like money cash that’s what we’re discussing 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 IRS all right so let’s talk about how it works due to the fact that it seems like to me if it’s a if it’s employee retention credit that person had to be a staff member 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 a service 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 first six months of 2021 on the W-2 appropriate so there were 6 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 two and three of 2021. alright 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 get back per staff member that was on a W-2 in those 6 quarters so the estimation in 2020 to be exact Kevin is 50 of the staff member’s salary to a maximum of 5 thousand dollars per employee for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the employee’s salary to an optimum of seven thousand per quarter how did that take place um they simply altered the rules in.
2021 versus because the chaos of the pandemic so they wanted 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 up to five thousand Max and then what occurs 21 000 Max in 2021 oh that’s how you develop twenty six thousand twenty one thousand to twenty twenty one plus five thousand in twenty twenty that’s twenty 6 thousand dollars per employee that is since that’s a great deal of money it is now there’s a caution here the PPP money would have to be reduced 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 usually Kevin is if you took PPP money somewhere around 10 thousand dollars an individual so let’s state hypothetically you owned a restaurant 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 huge certainly now the huge concern is why does nobody understand about this since appearance when I initially heard about this when I initially met Josh you understand I’ve got lots of financial investments in lots of business I’m a significant supporter for entrepreneurship in America and make many numerous investments in entrepreneurs of which lots of suffered through the pandemic when I initially found out about this I called BS I do not believe it due to the fact that I utilize 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 which were well should have and we used them wisely to stay alive throughout the pandemic so when I found out about this I said nah it can’t be true but when I dug around I even called to my political leader pals 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 details out there then a lot of individuals informed me well you can’t get it since you took the PPP likewise not real so let’s ask Josh why does no one learn about the staff member retention credit you understand what’s interesting you’re speaking about the banks Kevin since in the PPP loan procedure 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 huge 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 process procedure that’s all um and here there was mayhem because keep in mind in the original cares act you could refrain from doing both programs so if you had actually done PPP you could not do ERC in the initial program and when they changed the law in 2021 the banks were refraining from doing ERC because it’s not alone so you’re getting a tax refund so the federal government never ever made it clear to anyone about how to.
do this does your CFO know how to do this not actually she or he’s never done it before do the banks do it nope the banks don’t do it the payroll business yeah a few of them are doing it as a payroll business your accountant 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 since 2009 and we have actually been working with the federal government and the state government to recuperate cash for Fortune 500 Fortune 1000 companies so a great deal of our huge huge corporate clients have actually worked with bottom line to recuperate other federal government programs we’ve done sales tax and utilize tax joblessness tax work opportunity tax credits research and development tax credits unclaimed home property tax all of these other government programs.
The staff member retention tax credit is a broad based refundable tax credit developed to motivate.
companies to keep workers on their payroll. The credit is 50% of approximately $10,000 in earnings paid by an.
employer whose organization is fully or partially suspended because of COVID-19 or whose gross invoices.
decrease by more than 50%.
1. The credit is readily available to all companies regardless of size consisting of tax exempt organizations. There are.
only 2 exceptions: (1) state and local governments and their instrumentalities and (2) small.
organizations who take Small Business Loans.
2. To certify, the employer has to meet one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the employer’s organization is totally 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 similar quarter in 2019. When the.
company’s gross receipts go above 80% of an equivalent quarter in 2019 they no longer certify.
after completion of that quarter.
Calculation of the Credit.
The quantity of the credit is 50% of the certifying salaries paid up to $10,000 in overall.
It is effective for earnings paid after March 13th and before December 31, 2020.
The definition of qualifying earnings differs by whether an employer had, usually, more or less than.
100 staff members in 2019.
Companies that focus on ERC filing assistance typically provide competence and assistance to help organizations browse the complex procedure of claiming the credit. They can provide different services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit And Ppp Loan
Eligibility Evaluation: These business will examine your service’s eligibility for the ERC based on aspects such as your market, profits, and operations. If you fulfill the requirements for the credit and recognize the maximum credit amount you can declare, they can assist determine.
Paperwork and Calculation: ERC filing services will assist in gathering the essential paperwork, such as payroll records and monetary statements, to support your claim. They will likewise help determine the credit amount based on qualified wages and other qualifying expenses.
Retroactive Claim Review: If you are qualified to declare the ERC for prior quarters, these companies can evaluate your previous payroll records and financials to identify possible opportunities for retroactive credits. They can assist you change prior tax returns to declare these refunds.
Filing Support: Companies concentrating on ERC filings will prepare and submit the required forms and documents on your behalf. This consists of finishing Kind 941 or any other necessary tax forms.
Compliance and Updates: ERC guidelines and assistance have developed with time. These companies remain upgraded with the most recent modifications and ensure that your filings adhere to the most current standards. If the IRS requests additional information or carries out an audit related to your ERC claim, they can likewise supply continuous assistance.
It is necessary to research study and veterinarian any company offering ERC filing help to ensure their credibility and know-how. Look for recognized companies with experience in tax and payroll services, or consider reaching out to trusted accounting companies or tax specialists who offer ERC filing assistance.
Bear in mind that while these business can supply important help, it’s always a great concept to have a fundamental understanding of the ERC requirements and process yourself. This will assist you make notified choices and ensure accurate 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 companies to maintain and pay their employees during the pandemic, even if their operations have actually been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is readily available to qualified companies, including for-profit organizations, tax-exempt companies, and particular governmental entities. To qualify, employers should fulfill one of two requirements:.
Business operations were totally or partially suspended due to a government order related to COVID-19.
The business experienced a significant decrease in gross receipts. As discussed previously, for 2021, a substantial decline is specified as a 20% decrease in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a considerable 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 immediately preceding quarter.
Credit Amount: The ERC is a refundable tax credit that offsets the employer’s share of Social Security taxes. The credit amount amounts to a portion (as much as 70%) of certified wages paid to staff members, including specific health insurance costs. The maximum credit per employee is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: At first, companies that got an Income Defense Program (PPP) loan were not qualified for the ERC. However, legislation passed in late 2020 and extended in 2021 permits organizations to claim the ERC even if they received a PPP loan. However, the exact same earnings can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has actually been retroactively broadened and enhanced, allowing eligible employers to declare the credit for qualified salaries paid as far back as March 13, 2020. This retroactive provision supplies an opportunity for organizations to amend prior-year income tax return and receive refunds.
Declaring the Credit: Companies can claim the ERC by reporting it on their employment tax returns, usually Form 941. If the credit exceeds the quantity of work taxes owed, the excess can be refunded to the company.
It is very important to keep in mind that the ERC provisions and eligibility criteria have actually evolved with time. The best strategy is to talk to a tax expert or go to the main internal revenue service site for the most up-to-date and detailed details relating to the ERC, including any recent legislative changes or updates.
To receive the ERC, a company should 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 decline in gross receipts. For 2021, a considerable decline is defined as a 20% decline in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a considerable decrease is defined as a 20% decrease in gross invoices compared to the same quarter in 2019, or a 20% decline in gross receipts compared to the immediately preceding quarter.
The ERC is readily available to businesses of all sizes, including tax-exempt organizations, but there are some exceptions. Federal government entities and services that got a PPP loan might have limitations on claiming the credit.
The process for declaring the ERC includes finishing the required kinds and including the credit on your work income tax return (usually Form 941). The exact time it requires to process the credit can vary based upon numerous factors, including the intricacy of your service and the work of the internal revenue service. It’s advised to consult with a tax professional for assistance specific to your situation.
There are several companies that can help with the procedure of claiming the ERC. Some well-known business that offer help with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the details offered here is based on basic understanding and might not show the most recent updates or modifications to the ERC. It’s important to speak with a tax expert or go to the official IRS site for the most accurate and up-to-date information relating to eligibility, declaring treatments, and available help.
Less than 100. The credit is based if the employer had 100 or less workers on average in 2019.
on salaries paid to all employees whether they in fact worked or not. In other words, even if the.
employees worked full-time and earned money for full-time work, the employer still gets the credit.
Greater than 100. If the company had more than 100 staff members usually in 2019, then the credit is.
allowed only for incomes paid to staff members who did not work during the calendar quarter.
In both cases, “earnings” includes not simply cash payments but likewise a part of the expense of employer.
provided healthcare. Employee Retention Credit And Ppp Loan
Employers can be instantly compensated for the credit by reducing the amount of payroll taxes they.