Lets talk first about Employee Retention Credit For Nonprofits :
Our group here what do these people doing everybody in this space is assisting teach people about ERC and uh constantly provide a stunning breakfast and have people actually learn about the program we need to head to the room where we have the ability to display some of the checks that we are getting for business and I want to see that what is this this is uh numerous countless dollars literally Kevin numerous millions of dollars so these are replicate copies of the letters that go to customers confirming that the check is on the way I indicate you know if you just start 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 imply it’s just I indicate think of how many real clients that went through the program yeah this is the very end this is the celebration at the end when the check is validated the numbers are verified and the check is on the mail in the mail from the internal revenue service heading to the customer so that’s how you’re able to track it you know when you
receive this you understand the check is gone for sure which’s when they pay so they do not pay anything up until they in fact receive the money they do not pay bottom line Wonder trust anything till this letter is validated the check is on the way they deposit it into their bank account and they can truly trust Wonder trust that the procedure has actually been ended up and how many you think you’ve processed considering that you began this we’re about 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 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 Fantastic here you’re at my YouTube channel we’re speaking about something really important today the worker retention credit which most of you have never become aware of I definitely hadn’t heard of it until very recently and found out a lot about it because this is probably the most affordable expense of capital for any small business anywhere
anytime if you have staff members between 5 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 biggest processor of these ERC credits this is a 170 page program so it’s not easy 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 inform us all about it and how to get it and why I’ve become yes the Ambassador and paid representative for this I enjoy this program it’s going away soon you got to find out all about it let’s talk worker retention credit Josh Fox what is an ERC let’s just start there so throughout the Trump Administration when President Trump was enacted they created the cares Act and the cares act used services 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.
correct the money cash payroll tax refund all right go on sorry I just have to ensure we got that point I mean that’s a huge distinction a loan versus cash money I like cash cash that’s what we’re speaking about okay 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 original cares Act is the ERC and yes Kevin it is a gorgeous difficult check in the mail where you get actual money from the IRS all right so let’s discuss how it works because it seems 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 Presumption this money is not for the owner not for individuals on the cap table not for shareholders it’s for employees right you had to have owned a service however it’s based on you having W-2 employees in America not 10.99. As long as you had W-2 staff members 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 6 quarters so you had quarters 2 three and four of 2020 and you had quarters one 2 and 3 of 2021. alright so that’s how it’s measured you need to be on the W-2 during that duration now let’s talk my favorite part money how much can you get back per staff member that was on a W-2 in those six quarters so the computation in 2020 to be exact Kevin is 50 of the worker’s income to a maximum of five thousand dollars per worker for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the employee’s income to a maximum of 7 thousand per quarter how did that happen um they just changed the rules in.
2021 versus due to the fact that 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 after that 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 employee that is since that’s a lot 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 2 you would lower the 26 000 so what we’re seeing on average Kevin is if you took PPP cash someplace around 10 thousand dollars an individual so let’s say hypothetically you owned a dining establishment in New York 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 huge clearly now the huge question is why does nobody learn about this since appearance when I initially found out about this when I first fulfilled Josh you understand I’ve got great deals of investments in lots of companies I’m a major advocate for entrepreneurship in America and make numerous lots of investments in entrepreneurs of which numerous suffered through the pandemic when I initially found out about this I called BS I don’t believe it due to the fact that I utilize the PPP we went through the money 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 should have and we used them sensibly to stay alive during the pandemic so when I became aware of this I stated nah it can’t hold true however when I dug around I even called to my political leader buddies Guv Senators they didn’t learn about it I mean that’s how you understand that’s how misinformation is that there’s no details out there then a lot of individuals told me well you can’t get it since you took the PPP also not true so let’s ask Josh why does no one learn about the employee retention credit you know what’s fascinating you’re discussing the banks Kevin because 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 big 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 since remember in the original cares act you could refrain from doing both programs so if you had actually done PPP you might not do ERC in the original program and when they altered 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 ever made it clear to anyone about how to.
do this does your CFO know 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 companies yeah some of them are doing it as a payroll business your accounting professional no your accounting professional’s never done this before unless you have an account that entered into this service and bottom line my firm Kevin has actually stayed in business given that 2009 and we’ve been dealing with the federal government and the state federal government to recover money for Fortune 500 Fortune 1000 business so a great deal of our huge huge corporate customers 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 property property tax all of these other government programs.
The staff member retention tax credit is a broad based refundable tax credit created to motivate.
employers to keep employees on their payroll. The credit is 50% of as much as $10,000 in incomes paid by an.
company whose service is completely or partially suspended because of COVID-19 or whose gross receipts.
decrease by more than 50%.
1. The credit is available to all employers regardless of size including tax exempt companies. There are.
only 2 exceptions: (1) state and local governments and their instrumentalities and (2) little.
services who take Small Business Loans.
2. To certify, the employer has to fulfill one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the company’s business is totally or partly suspended by government order due to COVID-19.
throughout the calendar quarter or.
o the employer’s gross invoices are below 50% of the equivalent quarter in 2019. As soon as the.
employer’s gross receipts go above 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 qualifying incomes paid up to $10,000 in total.
It is effective for incomes paid after March 13th and prior to December 31, 2020.
The definition of qualifying earnings varies by whether an employer had, usually, more or less than.
100 employees in 2019.
Business that focus on ERC filing help normally offer expertise and support to assist businesses browse the complicated procedure of claiming the credit. They can offer various services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit For Nonprofits
Eligibility Assessment: These business will examine your organization’s eligibility for the ERC based on elements such as your market, income, and operations. If you fulfill the requirements for the credit and recognize the optimum credit quantity you can declare, they can assist figure out.
Documentation and Calculation: ERC filing services will assist in gathering the needed documentation, such as payroll records and monetary statements, to support your claim. They will also assist compute the credit quantity based upon qualified salaries and other certifying expenses.
Retroactive Claim Evaluation: If you are qualified to claim the ERC for previous quarters, these business can review your previous payroll records and financials to recognize potential opportunities for retroactive credits. They can help you modify previous income tax return to claim these refunds.
Filing Help: Business specializing in ERC filings will prepare and send the essential kinds and documentation in your place. This consists of completing Kind 941 or any other necessary tax forms.
Compliance and Updates: ERC policies and assistance have actually evolved over time. These business remain updated with the latest changes and ensure that your filings comply with the most present guidelines. If the Internal revenue service requests additional details or carries out an audit related to your ERC claim, they can likewise provide ongoing support.
It is essential to research and vet any business offering ERC filing help to ensure their credibility and competence. Try to find recognized companies with experience in tax and payroll services, or think about connecting to relied on accounting firms or tax specialists who provide ERC submitting assistance.
Keep in mind that while these business can provide valuable support, it’s constantly an excellent idea to have a basic understanding of the ERC requirements and process yourself. This will assist you make informed decisions and make sure accurate filings.
The Employee 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 businesses to keep and pay their workers during the pandemic, even if their operations have been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is available to eligible employers, consisting of for-profit companies, tax-exempt organizations, and certain governmental entities. To qualify, employers must fulfill one of two criteria:.
The business operations were totally or partly suspended due to a government order related to COVID-19.
Business experienced a significant decline in gross receipts. 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 considerable decrease is defined as a 20% decrease in gross receipts compared to the exact same quarter in 2019, or a 20% decrease 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 amount is equal to a percentage (as much as 70%) of qualified wages paid to employees, consisting of certain health plan costs. The maximum credit per worker is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: At first, services that got a Paycheck Defense Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 enables services to declare the ERC even if they got a PPP loan. Nevertheless, the same earnings can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively expanded and boosted, permitting eligible employers to declare the credit for certified earnings paid as far back as March 13, 2020. This retroactive provision provides a chance for organizations to amend prior-year tax returns and receive refunds.
Declaring the Credit: Companies can declare the ERC by reporting it on their work tax returns, usually Form 941. The excess can be refunded to the employer if the credit goes beyond the amount of employment taxes owed.
It’s important to keep in mind that the ERC provisions and eligibility criteria have actually evolved over time. The very best course of action is to consult with a tax professional or visit the official internal revenue service site for the most in-depth and up-to-date details concerning the ERC, consisting of any current legal changes or updates.
To qualify for the ERC, a service should satisfy among the following criteria:.
The business operations were totally or partly suspended due to a government order related to COVID-19.
The business experienced a considerable decline in gross receipts. For 2021, a considerable decline is defined as a 20% decline in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a considerable decrease is specified as a 20% decline in gross receipts compared to the very same quarter in 2019, or a 20% decline in gross invoices compared to the immediately preceding quarter.
The ERC is available to companies of all sizes, including tax-exempt companies, but there are some exceptions. Federal government entities and organizations that got a PPP loan may have constraints on claiming the credit.
The process for declaring the ERC includes finishing the needed types and including the credit on your employment tax return (usually Form 941). The exact time it requires to process the credit can vary based on a number of elements, including the complexity of your service and the workload of the internal revenue service. It’s recommended to speak with a tax professional for assistance particular to your circumstance.
There are numerous business that can help with the procedure of claiming the ERC. Some widely known business that provide support with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the details offered here is based on general understanding and might not show the most current updates or changes to the ERC. It is essential to speak with a tax expert or visit the main internal revenue service website for the most accurate and current details regarding eligibility, claiming procedures, and offered support.
Less than 100. The credit is based if the company had 100 or less employees on average in 2019.
on salaries paid to all employees whether they in fact worked or not. Simply put, even if the.
employees worked full time and earned money for full-time work, the company still gets the credit.
Greater than 100. If the employer had more than 100 employees usually in 2019, then the credit is.
enabled only for wages paid to staff members who did not work during the calendar quarter.
In both cases, “wages” consists of not just cash payments however also a portion of the expense of company.
provided health care. Employee Retention Credit For Nonprofits
Employers can be instantly reimbursed for the credit by decreasing the amount of payroll taxes they.