Lets talk first about Fica Tip Credit And Employee Retention Credit :
Our group here what do these people doing everybody in this room is assisting teach individuals about ERC and uh constantly supply a beautiful breakfast and have individuals truly learn more about the program we need to head to the space where we have the ability to display a few of the checks that we are getting for companies and I wish to see that what is this this is uh hundreds of millions of dollars literally 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 way I imply you know if you simply start to take a look at a few of these here I indicate 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 about the number of actual customers that went through the program yeah this is the very end this is the celebration at the end when the check is confirmed 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’re able to track it you know when you
get this you understand the check is chosen sure and that’s when they pay so they do not pay anything till they really receive the money they do not pay bottom line Wonder trust anything 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 process has been completed 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 six billion dollars wow so clearly they know what they’re doing and that’s what you need you require 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 Wonderful here you’re at my YouTube channel we’re discussing something actually crucial today the worker retention credit which the majority of you have actually never ever become aware of I definitely hadn’t heard of it till extremely just recently and learned a lot about it because this is most likely the most affordable expense of capital for any small business anywhere
anytime if you have staff members between five and five hundred so I have actually got the expert 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 difficult this isn’t like PPP we simply call up your bank manager and say give me a loan it does not 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 ended up being yes the Ambassador and paid spokesperson for this I like this program it’s going away soon you got to discover all about it let’s talk employee retention credit Josh Fox what is an ERC let’s simply begin there so during the Trump Administration when President Trump was enacted they created the cares Act and the cares act provided services three 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 two of them are loans and one’s a refund precisely so the ERC is a refund that’s.
correct the cash money payroll tax refund all right go on sorry I just have to make certain we got that point I suggest that’s a huge difference a loan versus money 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 initial cares Act is the ERC and yes Kevin it is a lovely hard check in the mail where you get real cash from the IRS all right so let’s speak about how it works since 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 cash is not for the owner not for individuals on the cap table not for shareholders it’s for staff members right you needed to have owned a service however it’s based upon you having W-2 staff members 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 eligible 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 six quarters the program was open well walk us through the six quarters so you had quarters two three and 4 of 2020 and you had quarters one 2 and three of 2021. all right so that’s how it’s determined you have to be on the W-2 during that duration now let’s talk my preferred part money just how much can you get back per employee that was on a W-2 in those six quarters so the computation in 2020 to be exact Kevin is 50 of the staff member’s wage to a maximum of 5 thousand dollars per worker for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the employee’s salary to a maximum of 7 thousand per quarter how did that take place um they just altered the rules in.
2021 versus since 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 five thousand Max and then what occurs 21 000 Max in 2021 oh that’s how you come up with twenty six thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty 6 thousand dollars per staff member that is because that’s a great deal of cash it is now there’s a caution here the PPP money would have to be decreased from the twenty six thousand dollars so if you took PPP loan one and PPP loan two you would minimize the 26 000 so what we’re seeing on average Kevin is if you took PPP money someplace around ten thousand dollars a person so let’s state hypothetically you owned a restaurant in New york city 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 internal revenue service so it’s huge undoubtedly now the big concern is why does nobody understand about this since appearance when I first found out about this when I initially satisfied Josh you understand I’ve got great deals of investments in lots of business I’m a significant advocate for entrepreneurship in America and make numerous numerous investments in entrepreneurs of which lots of suffered through the pandemic when I first heard about this I called BS I do not believe it since I use the PPP we went through the money 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 been worthy of and we utilized them carefully to survive throughout 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 good friends Governor Senators they didn’t know about it I suggest 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 because you took the PPP likewise not true so let’s ask Josh why does no one know about the employee retention credit you understand what’s intriguing you’re discussing the banks Kevin due to the fact that in the PPP loan process the federal government made it very clear that if you wanted a PPP loan you would call Wells Fargo Citibank Bank of America any of the big banks in our country and they would process procedure in Canada a pre-pp loan there’s no loans in Canada by the way it’s just procedure procedure that’s all um and here there was mayhem due to the fact that keep in mind in the initial cares act you could not do both programs so if you had done PPP you could not do ERC in the initial program and when they altered the law in 2021 the banks were refraining from 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 anyone about how to.
do this does your CFO know how to do this not actually she or he’s never ever done it previously do the banks do it nope the banks do not do it the payroll business yeah some of them are doing it as a payroll company your accounting professional no your accountant’s never done this prior to unless you have an account that entered into this organization and bottom line my company Kevin has actually stayed in business considering that 2009 and we have actually been dealing with the federal government and the state government to recover cash for Fortune 500 Fortune 1000 business so a lot of our big big business customers have dealt with bottom line to recuperate other federal government programs we have actually done sales tax and use tax unemployment tax work chance tax credits research and development tax credits unclaimed home real estate tax all of these other government programs.
The employee retention tax credit is a broad based refundable tax credit created to encourage.
companies to keep employees on their payroll. The credit is 50% of up to $10,000 in salaries paid by an.
company whose service is completely or partially suspended because of COVID-19 or whose gross receipts.
decline by more than 50%.
1. The credit is offered to all employers despite size consisting of tax exempt organizations. There are.
just two exceptions: (1) state and city governments and their instrumentalities and (2) small.
services who take Small company Loans.
2. To certify, the company needs to meet one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the company’s service 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 listed 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 qualify.
after completion of that quarter.
Calculation of the Credit.
The quantity of the credit is 50% of the qualifying salaries paid up to $10,000 in overall.
It works for salaries paid after March 13th and prior to December 31, 2020.
The definition of certifying wages differs by whether a company had, usually, basically than.
100 workers in 2019.
Business that focus on ERC filing help normally provide competence and support to help businesses browse the complex process of claiming the credit. They can offer numerous services, including:.
How is the employee retention credit calculated? Fica Tip Credit And Employee Retention Credit
Eligibility Evaluation: These companies will examine your business’s eligibility for the ERC based upon factors such as your industry, revenue, and operations. If you satisfy the requirements for the credit and identify the maximum credit quantity you can claim, they can assist determine.
Documentation and Estimation: ERC filing services will assist in gathering the essential documents, such as payroll records and monetary statements, to support your claim. They will likewise help determine the credit quantity based on eligible incomes and other qualifying expenditures.
Retroactive Claim Evaluation: If you are qualified to declare the ERC for previous quarters, these business can evaluate your past payroll records and financials to identify prospective chances for retroactive credits. They can help you amend previous income tax return to claim these refunds.
Filing Support: Companies focusing on ERC filings will prepare and send the needed forms and paperwork on your behalf. This includes completing Type 941 or any other necessary tax forms.
Compliance and Updates: ERC regulations and assistance have actually developed over time. These companies remain upgraded with the most recent changes and make sure that your filings abide by the most existing guidelines. They can also provide ongoing assistance if the IRS requests extra information or performs an audit related to your ERC claim.
It is necessary to research and vet any company using ERC filing help to guarantee their reliability and competence. Search for recognized companies with experience in tax and payroll services, or consider reaching out to relied on accounting companies or tax specialists who offer ERC filing assistance.
Keep in mind that while these business can provide important support, it’s always a great concept to have a basic understanding of the ERC requirements and procedure yourself. This will assist you make informed decisions and ensure precise filings.
The Employee Retention Credit (ERC) is a refundable tax credit presented by the U.S. government as part of COVID-19 relief procedures. The objective of the ERC is to encourage businesses to keep and pay their staff members during the pandemic, even if their operations have been impacted.
Here are some key points about the ERC:.
Eligibility: The ERC is readily available to qualified employers, consisting of for-profit organizations, tax-exempt companies, and certain governmental entities. To qualify, companies need to satisfy one of two criteria:.
The business operations were completely or partially suspended due to a government order related to COVID-19.
The business experienced a significant decline in gross receipts. As pointed out earlier, for 2021, a substantial decrease is specified as a 20% decrease in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a substantial decline is defined as a 20% decline in gross invoices compared to the exact same quarter in 2019, or a 20% decrease 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 quantity amounts to a portion (approximately 70%) of certified earnings paid to staff members, consisting of specific health insurance costs. The optimum 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, businesses that received a Paycheck Protection Program (PPP) loan were not eligible for the ERC. However, legislation passed in late 2020 and extended in 2021 permits organizations to claim the ERC even if they got a PPP loan. The very same earnings can not be utilized to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively expanded and enhanced, allowing eligible employers to declare the credit for certified incomes paid as far back as March 13, 2020. This retroactive arrangement supplies an opportunity for organizations to modify prior-year income tax return and receive refunds.
Claiming the Credit: Companies can declare the ERC by reporting it on their work income tax return, generally Type 941. If the credit surpasses the amount of employment taxes owed, the excess can be reimbursed to the company.
It is essential to note that the ERC provisions and eligibility requirements have actually progressed over time. The best course of action is to consult with a tax professional or go to the official IRS site for the most detailed and up-to-date details regarding the ERC, consisting of any recent legislative changes or updates.
To qualify for the ERC, a business must meet one of the following requirements:.
Business operations were completely or partially suspended due to a federal government order related to COVID-19.
Business experienced a substantial decline in gross receipts. For 2021, a considerable decrease is defined as a 20% decline in gross receipts compared to the 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 receipts compared to the immediately preceding quarter.
The ERC is offered to organizations of all sizes, consisting of tax-exempt companies, but there are some exceptions. Government entities and organizations that received a PPP loan may have limitations on claiming the credit.
The procedure for declaring the ERC involves finishing the necessary types and consisting of the credit on your employment income tax return (usually Form 941). The exact time it requires to process the credit can differ based upon a number of elements, including the complexity of your company and the work of the internal revenue service. It’s advised to talk to a tax professional for assistance particular to your circumstance.
There are a number of companies that can assist with the process of claiming the ERC. These consist of accounting firms, tax advisory services, and payroll service providers. Some well-known companies that use assistance with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s suggested to research study and contact these companies directly to inquire about their costs and services.
Please note that the info offered here is based upon general understanding and may not show the most recent updates or changes to the ERC. It is necessary to seek advice from a tax professional or go to the main internal revenue service site for the most current and precise info regarding eligibility, claiming procedures, and available support.
Less than 100. The credit is based if the employer had 100 or fewer employees on average in 2019.
on earnings paid to all staff members whether they really worked or not. Simply put, even if the.
staff members worked full-time and made money for full time work, the company still gets the credit.
Greater than 100. If the company had more than 100 staff members typically in 2019, then the credit is.
enabled only for salaries paid to staff members who did not work during the calendar quarter.
In both cases, “earnings” includes not just money payments however likewise a part of the cost of employer.
offered healthcare. Fica Tip Credit And Employee Retention Credit
Employers can be right away compensated for the credit by reducing the quantity of payroll taxes they.