Lets talk first about Employee Retention Credit Private Equity :
Our group here what do these guys doing everyone in this room is helping teach people about ERC and uh always provide a stunning breakfast and have people really find out 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 actually Kevin numerous countless dollars so these are duplicate copies of the letters that go to clients confirming that the check is on the method I mean you know if you simply begin to look at a few of these here I imply this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I indicate it’s just I indicate think of the number of real clients that went through the program yeah this is the very end this is the party at the end when the check is verified 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 have the ability to track it you know when you
get this you know the check is chosen sure and that’s when they pay so they do not pay anything until they really get the money they don’t pay bottom line Wonder trust anything till this letter is verified the check is on the way they deposit it into their savings account and they can really trust Wonder trust that the process has actually been completed and how many you think you’ve processed since you started this we’re about 35 000 of these for
about six billion dollars wow so plainly they understand what they’re doing which’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 discussing something truly essential today the employee retention credit which most of you have actually never become aware of I certainly had not heard of it up until extremely just recently and discovered a lot about it because this is most likely the lowest expense of capital for any small company anywhere
anytime if you have workers in between five and five hundred so I’ve got the professional with me this is Josh Fox he’s the founder and CEO of bottom line Principles 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 simply call up your bank supervisor and state give me a loan it doesn’t work there’s not a loan it’s an application and Josh is going to tell us all about it and how to get it and why I have actually ended up being yes the Ambassador and paid representative for this I like this program it’s disappearing soon you got to discover everything about it let’s talk worker retention credit Josh Fox what is an ERC let’s just begin there so throughout the Trump Administration when President Trump was enacted they came up with the cares Act and the cares act offered organizations 3 opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and almost everybody it makes a big distinction right there two of them are loans and one’s a refund precisely so the ERC is a refund that’s.
fix the money cash payroll tax refund alright go on sorry I simply have to make sure we got that point I mean that’s a huge distinction a loan versus cash money I like money money that’s what we’re speaking about 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 original cares Act is the ERC and yes Kevin it is a lovely hard check in the mail where you get actual money from the internal revenue service all right so let’s talk about how it works because it seems like to me if it’s a if it’s employee retention credit that individual had to be a worker so I’m going to make the Presumption this cash is not for the owner not for people on the cap table not for investors it’s for employees right you needed to have owned a business but it’s based on you having W-2 staff members in America not 10.99. so as long as you had W-2 employees and you paid federal payroll taxes that’s why you would be eligible so you need 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 6 quarters the program was open well walk us through the six quarters so you had quarters 2 three and 4 of 2020 and you had quarters one two and three of 2021. all right so that’s how it’s determined you have to be on the W-2 throughout that period now let’s talk my preferred part cash how much can you get back per worker that was on a W-2 in those 6 quarters so the computation in 2020 to be exact Kevin is 50 of the employee’s wage to an optimum of 5 thousand dollars per staff member for the year of 2020 and in 2021 the numbers increased to 70 of the employee’s salary to a maximum of seven thousand per quarter how did that occur um they simply altered the rules in.
2021 versus due to the fact that the turmoil of the pandemic so they wanted 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 5 thousand Max and then what takes place 21 000 Max in 2021 oh that’s how you develop twenty 6 thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty six thousand dollars per staff member that is because that’s a lot of cash it is now there’s a caveat here the PPP cash would have to be minimized from the twenty six thousand dollars so if you took PPP loan one and PPP loan 2 you would reduce the 26 000 so what we’re seeing typically Kevin is if you took PPP money somewhere around ten 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 workers and you took PPP money you would still get a million dollar in the mail from the IRS so it’s substantial undoubtedly now the huge question is why does no one understand about this due to the fact that appearance when I initially found out about this when I first fulfilled Josh you understand I’ve got great deals of financial investments in lots of companies I’m a significant supporter for entrepreneurship in America and make lots of numerous investments in entrepreneurs of which lots of suffered through the pandemic when I initially became aware of this I called BS I don’t believe it since I utilize 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 and that were well deserved and we utilized them sensibly to survive throughout the pandemic so when I became aware of this I said nah it can’t be true however when I dug around I even contacted us to my politician friends Guv Senators they didn’t know about it I indicate that’s how you understand that’s how false information is that there’s no details out there then a lot of people informed me well you can’t get it since you took the PPP also 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 talking about the banks Kevin since in the PPP loan process the federal government made it really clear that if you desired 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 just procedure process that’s all um and here there was mayhem since remember in the initial cares act you might not do both programs so if you had actually done PPP you could not do 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 ever made it clear to anyone about how to.
do this does your CFO understand how to do this not actually he or she’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 accountant no your accounting professional’s never done this prior to unless you have an account that went into this service and bottom line my firm Kevin has actually stayed in business since 2009 and we have actually been dealing with the federal government and the state government to recuperate cash for Fortune 500 Fortune 1000 business so a lot of our huge big business customers have worked with bottom line to recuperate other federal government programs we have actually done sales tax and use tax joblessness tax work opportunity 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 motivate.
employers to keep staff members on their payroll. The credit is 50% of up to $10,000 in earnings paid by an.
company whose business is fully or partly suspended because of COVID-19 or whose gross receipts.
decline by more than 50%.
1. The credit is offered to all companies regardless of size including tax exempt companies. There are.
just 2 exceptions: (1) state and city governments and their instrumentalities and (2) small.
companies who take Small Business Loans.
2. To qualify, the employer needs to fulfill one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the company’s business is totally or partly suspended by government order due to COVID-19.
during the calendar quarter or.
o the company’s gross invoices are below 50% of the comparable quarter in 2019. Once the.
employer’s gross invoices exceed 80% of an equivalent quarter in 2019 they no longer certify.
after completion of that quarter.
Estimation of the Credit.
The quantity of the credit is 50% of the qualifying earnings paid up to $10,000 in overall.
It works for wages paid after March 13th and before December 31, 2020.
The definition of certifying wages varies by whether a company had, usually, basically than.
100 staff members in 2019.
Business that specialize in ERC filing help generally supply competence and assistance to assist services navigate the complicated process of claiming the credit. They can offer various services, consisting of:.
How is the employee retention credit calculated? Employee Retention Credit Private Equity
Eligibility Assessment: These business will evaluate your organization’s eligibility for the ERC based upon aspects such as your industry, revenue, and operations. They can assist figure out if you satisfy the requirements for the credit and identify the optimum credit amount you can declare.
Documentation and Estimation: ERC filing services will assist in collecting the required documentation, such as payroll records and financial statements, to support your claim. They will also assist compute the credit quantity based upon eligible incomes and other qualifying expenditures.
Retroactive Claim Evaluation: If you are eligible to declare the ERC for prior quarters, these companies can review your previous payroll records and financials to determine potential opportunities for retroactive credits. They can assist you change previous tax returns to claim these refunds.
Filing Help: Companies concentrating on ERC filings will prepare and submit the necessary forms and documentation in your place. This includes finishing Kind 941 or any other required tax return.
Compliance and Updates: ERC policies and guidance have evolved with time. These business stay updated with the latest modifications and ensure that your filings adhere to the most present standards. If the Internal revenue service demands additional info or conducts an audit related to your ERC claim, they can also provide continuous assistance.
It is necessary to research and vet any business offering ERC filing help to guarantee their reliability and know-how. Search for established companies with experience in tax and payroll services, or think about connecting to trusted accounting firms or tax specialists who use ERC submitting assistance.
Keep in mind that while these business can supply valuable help, it’s always a good idea to have a standard understanding of the ERC requirements and process yourself. This will help you make informed decisions and ensure 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 objective of the ERC is to motivate services to keep and pay their workers throughout the pandemic, even if their operations have been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is offered to eligible employers, including for-profit services, tax-exempt organizations, and particular governmental entities. To qualify, companies should fulfill one of two criteria:.
Business operations were totally or partly suspended due to a federal government order related to COVID-19.
Business experienced a considerable decrease in gross receipts. As pointed out earlier, for 2021, a substantial decline is defined as a 20% decline in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a significant decline is defined as a 20% decline in gross receipts compared to the same quarter in 2019, or a 20% decline in gross receipts compared to the instantly 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 (up to 70%) of certified wages paid to workers, consisting of particular health plan expenses. 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, companies that got an Income Protection Program (PPP) loan were not eligible for the ERC. However, legislation passed in late 2020 and extended in 2021 allows companies to claim the ERC even if they received a PPP loan. The very same incomes can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively expanded and improved, enabling eligible employers to claim the credit for certified salaries paid as far back as March 13, 2020. This retroactive arrangement supplies an opportunity for services to modify prior-year income tax return and receive refunds.
Declaring the Credit: Companies can claim the ERC by reporting it on their employment income tax return, usually Form 941. If the credit goes beyond the amount of work taxes owed, the excess can be refunded to the employer.
It’s important to keep in mind that the ERC arrangements and eligibility criteria have developed over time. The very best strategy is to talk to a tax expert or check out the main IRS website for the most comprehensive and current details regarding the ERC, including any current legal modifications or updates.
To get approved for the ERC, a company should satisfy one of the following requirements:.
Business operations were completely or partially suspended due to a government order related to COVID-19.
The business experienced a considerable decline in gross invoices. For 2021, a considerable decline is specified as a 20% decline in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a considerable decline is defined as a 20% decrease in gross invoices compared to the exact same quarter in 2019, or a 20% decrease in gross receipts compared to the right away preceding quarter.
The ERC is offered to organizations of all sizes, consisting of tax-exempt companies, but there are some exceptions. For example, government entities and services that got a PPP loan might have constraints on declaring the credit.
The procedure for declaring the ERC includes completing the needed types and including the credit on your employment tax return (typically Form 941). The exact time it takes to process the credit can vary based on numerous factors, including the intricacy of your business and the work of the internal revenue service. It’s recommended to consult with a tax expert for guidance particular to your circumstance.
There are a number of business that can help with the process of declaring the ERC. Some popular business that use support with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the details provided here is based on basic knowledge and might not show the most recent updates or changes to the ERC. It is essential to seek advice from a tax professional or go to the main IRS website for the most updated and accurate details regarding eligibility, declaring treatments, and readily available support.
Less than 100. The credit is based if the employer had 100 or less staff members on average in 2019.
on incomes paid to all employees whether they actually worked or not. In other words, even if the.
workers worked full time and earned money for full time work, the company still gets the credit.
Greater than 100. The credit is if the employer had more than 100 staff members on average in 2019.
permitted only for wages paid to staff members who did not work during the calendar quarter.
In both cases, “earnings” includes not simply money payments but also a part of the expense of company.
provided healthcare. Employee Retention Credit Private Equity
Employers can be instantly compensated for the credit by reducing the quantity of payroll taxes they.