Lets talk first about Gross Receipts Decline For Employee Retention Credit :
Our group here what do these men doing everyone in this room is helping teach individuals about ERC and uh constantly provide a stunning breakfast and have individuals really learn more about the program we should head to the room where we are able to show a few of the checks that we are getting for companies and I ‘d like to see that what is this this is uh hundreds of countless dollars actually Kevin hundreds of countless dollars so these are duplicate copies of the letters that go to customers verifying that the check is on the way I suggest you understand if you simply begin to look at some of these here I mean this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I suggest it’s simply I mean think of how many real customers 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 validated 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 know when you
receive this you know the check is chosen sure and that’s when they pay so they don’t pay anything till they in fact receive the money they do not pay bottom line Wonder trust anything until this letter is validated the check is on the method they deposit it into their bank account and they can truly trust Wonder trust that the process has been completed and how many you believe you’ve processed considering that you started this we have to do with 35 000 of these for
about 6 billion dollars wow so plainly they understand what they’re doing and that’s what you require you need specialists 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 talking about 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 really recently and learned a lot about it since this is most likely the lowest expense of capital for any small business anywhere
anytime if you have workers between five and five hundred so I’ve 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 not easy this isn’t like PPP we just call your bank manager and state offer 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 become yes the Ambassador and paid representative for this I enjoy this program it’s going away soon you got to learn everything about it let’s talk staff member retention credit Josh Fox what is an ERC let’s just start there so during the Trump Administration when President Trump was enacted they came up with the cares Act and the cares act offered companies 3 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 difference 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 alright go on sorry I just have to ensure we got that point I indicate that’s a huge difference a loan versus money cash I like money cash that’s what we’re speaking about fine 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 stunning hard check in the mail where you get actual cash 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 worker retention credit that person needed to be a staff member so I’m going to make the Assumption this cash is not for the owner not for individuals on the cap table not for shareholders it’s for employees right you had to have actually owned a company but it’s based upon you having W-2 workers in America not 10.99. As long as you had W-2 workers 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 appropriate so there were six quarters the program was open well stroll us through the six quarters so you had quarters 2 three and 4 of 2020 and you had quarters one two and 3 of 2021. alright 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 return per employee that was on a W-2 in those 6 quarters so the estimation in 2020 to be precise Kevin is 50 of the employee’s salary 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 staff member’s wage to a maximum of seven thousand per quarter how did that occur um they simply altered the rules in.
2021 versus since the chaos of the pandemic so they wanted to even get more to keep those workers on payroll 100 so if you can get 5 000 per person Max in twenty that was 50 in 2020 approximately five thousand Max and then what happens 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 employee that is since that’s a lot of money it is now there’s a caveat here the PPP cash 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 typically Kevin is if you took PPP money somewhere around ten thousand dollars a person 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 money you would still get a million dollar in the mail from the internal revenue service so it’s substantial obviously now the huge question is why does no one understand about this because appearance when I initially heard about this when I first fulfilled Josh you know I’ve got lots of investments in lots of companies I’m a major supporter for entrepreneurship in America and make many numerous financial investments in business owners of which numerous suffered through the pandemic when I first became aware of this I called BS I do not 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 been worthy of and we used them carefully to stay alive during the pandemic so when I found out about this I stated nah it can’t hold true but when I dug around I even contacted us to my politician good friends Governor Senators they didn’t understand about it I indicate that’s how you understand that’s how false information is that there’s no information out there then a bunch of people told me well you can’t get it since you took the PPP likewise not real so let’s ask Josh why does nobody learn about the worker retention credit you understand what’s fascinating you’re talking about the banks Kevin because in the PPP loan procedure 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 nation and they would process process in Canada a pre-pp loan there’s no loans in Canada by the way it’s just process process that’s all um and here there was chaos since keep in mind in the initial cares act you might refrain from doing both programs so if you had actually done PPP you could refrain from doing ERC in the initial program and when they altered the law in 2021 the banks were not doing ERC because it’s not alone so you’re getting a tax refund so the government never ever made it clear to anyone about how to.
do this does your CFO understand how to do this not truly 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 a few of them are doing it as a payroll company your accountant no your accounting professional’s never done this before unless you have an account that entered into this business and bottom line my company Kevin has been in business because 2009 and we have actually been dealing with the federal government and the state government to recuperate money for Fortune 500 Fortune 1000 companies so a great deal of our big big corporate customers have actually worked with bottom line to recuperate other government programs we’ve done sales tax and use tax unemployment tax work chance tax credits research and development tax credits unclaimed home property tax all of these other government programs.
The worker retention tax credit is a broad based refundable tax credit designed to encourage.
companies to keep staff members on their payroll. The credit is 50% of as much as $10,000 in salaries paid by an.
Due to the fact that of COVID-19 or whose gross receipts, company whose business is completely or partly suspended.
decrease by more than 50%.
1. The credit is offered to all companies no matter size consisting of tax exempt companies. There are.
just two exceptions: (1) state and local governments and their instrumentalities and (2) little.
services who take Small company Loans.
2. To certify, the employer needs to meet one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the employer’s company 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. When the.
employer’s gross invoices exceed 80% of an equivalent quarter in 2019 they no longer qualify.
after completion of that quarter.
Computation of the Credit.
The amount of the credit is 50% of the certifying earnings paid up to $10,000 in total.
It is effective for wages paid after March 13th and before December 31, 2020.
The definition of qualifying salaries varies by whether an employer had, usually, basically than.
100 workers in 2019.
Companies that specialize in ERC filing support normally offer proficiency and support to assist businesses navigate the complicated process of claiming the credit. They can use numerous services, including:.
How is the employee retention credit calculated? Gross Receipts Decline For Employee Retention Credit
Eligibility Evaluation: These companies will evaluate your organization’s eligibility for the ERC based upon factors such as your market, earnings, and operations. If you meet the requirements for the credit and recognize the maximum credit quantity you can declare, they can assist identify.
Documentation and Calculation: ERC filing services will help in collecting the required paperwork, such as payroll records and financial declarations, to support your claim. They will likewise help determine the credit amount based on eligible salaries and other certifying expenditures.
Retroactive Claim Review: If you are eligible to claim the ERC for prior quarters, these companies can evaluate your past payroll records and financials to recognize prospective opportunities for retroactive credits. They can help you modify prior tax returns to claim these refunds.
Filing Help: Business focusing on ERC filings will prepare and send the needed types and paperwork on your behalf. This consists of finishing Kind 941 or any other required tax forms.
Compliance and Updates: ERC regulations and assistance have actually progressed gradually. These business remain updated with the latest modifications and ensure that your filings comply with the most existing guidelines. If the Internal revenue service demands additional details or performs an audit related to your ERC claim, they can likewise supply continuous assistance.
It is essential to research and vet any business providing ERC filing assistance to ensure their credibility and proficiency. Search for established companies with experience in tax and payroll services, or think about connecting to relied on accounting firms or tax experts who provide ERC filing assistance.
Remember that while these business can provide important assistance, it’s always an excellent idea to have a standard understanding of the ERC requirements and process yourself. This will help you make informed decisions and make sure accurate filings.
The Employee Retention Credit (ERC) is a refundable tax credit presented by the U.S. government as part of COVID-19 relief measures. The goal of the ERC is to encourage services to maintain and pay their employees during the pandemic, even if their operations have been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is available to eligible companies, consisting of for-profit services, tax-exempt organizations, and particular governmental entities. To certify, companies must satisfy one of two criteria:.
The business operations were completely or partially suspended due to a government order related to COVID-19.
Business experienced a significant decline in gross invoices. As discussed previously, for 2021, a substantial decline is defined as a 20% decline in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a substantial decline is specified as a 20% decline in gross receipts compared to the very same quarter in 2019, or a 20% decline in gross receipts 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 quantity is equal to a percentage (as much as 70%) of certified salaries paid to employees, consisting of particular health insurance 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: Initially, services that got a Paycheck Defense Program (PPP) loan were not eligible for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 enables companies to claim the ERC even if they got a PPP loan. Nevertheless, the same earnings can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively expanded and enhanced, enabling qualified employers to declare the credit for qualified earnings 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: Employers can declare the ERC by reporting it on their work income tax return, typically Type 941. If the credit goes beyond the quantity of work taxes owed, the excess can be reimbursed to the company.
It is essential to note that the ERC provisions and eligibility criteria have developed over time. The very best course of action is to consult with a tax expert or go to the main internal revenue service site for the most up-to-date and in-depth information regarding the ERC, including any recent legal changes or updates.
To get approved for the ERC, a service should meet one of the following criteria:.
Business operations were completely or partly suspended due to a federal government order related to COVID-19.
The business experienced a significant decrease in gross invoices. For 2021, a significant decrease is specified as a 20% decrease in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a considerable decline is specified as a 20% decline in gross receipts compared to the very same quarter in 2019, or a 20% decrease in gross invoices compared to the right away preceding quarter.
The ERC is available to organizations of all sizes, including tax-exempt organizations, but there are some exceptions. For example, government entities and services that got a PPP loan may have restrictions on declaring the credit.
The procedure for claiming the ERC includes completing the required kinds and including the credit on your work tax return (generally Form 941). The exact time it requires to process the credit can vary based upon numerous aspects, consisting of the intricacy of your organization and the workload of the IRS. It’s advised to seek advice from a tax expert for assistance particular to your circumstance.
There are several business that can help with the procedure of claiming the ERC. Some popular business that provide assistance with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please keep in mind that the info offered here is based on basic knowledge and might not show the most recent updates or modifications to the ERC. It is essential to seek advice from a tax expert or check out the main IRS site for the most current and precise details regarding eligibility, claiming procedures, and offered support.
Less than 100. If the employer had 100 or fewer staff members typically in 2019, then the credit is based.
on wages paid to all staff members whether they in fact worked or not. Simply put, even if the.
employees worked full time and made money for full-time work, the employer still gets the credit.
Greater than 100. The credit is if the employer had more than 100 staff members on average in 2019.
enabled just for incomes paid to staff members who did not work during the calendar quarter.
In both cases, “salaries” consists of not simply cash payments however likewise a part of the cost of company.
supplied health care. Gross Receipts Decline For Employee Retention Credit
Companies can be instantly repaid for the credit by lowering the quantity of payroll taxes they.