Lets talk first about How To Apply Employee Retention Credit :
Our team here what do these men doing everybody in this space is helping teach individuals about ERC and uh always supply a beautiful breakfast and have individuals really discover the program we must head to the space where we have the ability to show a few of the checks that we are getting for business and I wish to see that what is this this is uh numerous countless dollars literally Kevin hundreds of countless dollars so these are duplicate copies of the letters that go to clients confirming that the check is on the way I imply you know if you just begin to take a look at a few of these here I mean this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I imply it’s just I imply consider how many actual customers that went through the program yeah this is the very end this is the celebration at the end when the check is verified the numbers are verified 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 opted for sure and that’s when they pay so they don’t pay anything till they actually receive the cash they don’t pay bottom line Wonder trust anything until this letter is validated the check is on the way they transfer it into their bank account and they can truly rely on Wonder trust that the process has actually been finished and how many you think you have actually processed considering that you started this we’re about 35 000 of these for
about six billion dollars wow so clearly they know what they’re doing which’s what you need you require 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 speaking about something truly essential today the worker retention credit which the majority of you have never heard of I definitely had not become aware of it until really recently and learned a lot about it since this is probably the lowest cost of capital for any small company anywhere
anytime if you have staff members in between 5 and five hundred so I’ve got the professional with me this is Josh Fox he’s the creator and CEO of bottom line Concepts 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 just contact your bank manager and say provide me a loan it does not work there’s not a loan it’s an application and Josh is going to inform all of us about it and how to get it and why I have actually become yes the Ambassador and paid spokesperson for this I like this program it’s disappearing very soon you got to discover all about it let’s talk staff member retention credit Josh Fox what is an ERC let’s simply start there so throughout the Trump Administration when President Trump was enacted they came up with the cares Act and the cares act provided services 3 chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically everyone 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.
fix the cash money payroll tax refund fine go on sorry I simply have to ensure we got that point I mean that’s a big difference a loan versus cash money I like cash cash that’s what we’re talking about 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 original cares Act is the ERC and yes Kevin it is a lovely difficult check in the mail where you get actual money from the internal revenue service all right so let’s discuss how it works because it seems like to me if it’s a if it’s worker retention credit that person had to be an employee so I’m going to make the Presumption this money is not for the owner not for individuals on the cap table not for investors it’s for staff members right you had to have owned a service however it’s based on you having W-2 workers in America not 10.99. so 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 very first six months of 2021 on the W-2 proper so there were six 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 3 of 2021. okay so that’s how it’s determined you need to be on the W-2 during that duration now let’s talk my favorite part money just how much can you return per employee that was on a W-2 in those 6 quarters so the calculation in 2020 to be specific Kevin is 50 of the staff member’s income to an optimum of 5 thousand dollars per staff member for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the worker’s wage to an optimum of seven thousand per quarter how did that happen um they just changed the rules in.
2021 versus since the mayhem 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 approximately 5 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 staff member that is since that’s a lot of money it is now there’s a caveat 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 2 you would minimize the 26 000 so what we’re seeing usually Kevin is if you took PPP cash somewhere 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 workers 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 question is why does nobody know about this since appearance when I initially became aware of this when I initially met Josh you understand I have actually got lots of financial investments in lots of business I’m a major supporter for entrepreneurship in America and make lots of many investments in business owners of which many suffered through the pandemic when I first heard about this I called BS I don’t believe it because I use 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 been worthy of and we used them carefully to stay alive throughout the pandemic so when I found out about this I stated nah it can’t hold true but when I dug around I even called to my political leader friends Guv Senators they didn’t know about it I suggest that’s how you know that’s how misinformation is that there’s no details out there then a lot of people informed me well you can’t get it because you took the PPP also not real so let’s ask Josh why does nobody know about the worker retention credit you understand what’s intriguing you’re talking about the banks Kevin due to the fact that 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 procedure 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 chaos due to the fact that remember 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 original program and when they altered the law in 2021 the banks were refraining from doing ERC since 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 know how to do this not actually she or he’s never ever done it before do the banks do it nope the banks do not do it the payroll business yeah a few of them are doing it as a payroll company your accounting professional no your accountant’s never ever done this before unless you have an account that went into this business and bottom line my firm Kevin has stayed in business because 2009 and we’ve been dealing with the federal government and the state government to recover cash for Fortune 500 Fortune 1000 companies so a lot of our huge huge business customers have dealt with bottom line to recuperate other government programs we have actually done sales tax and use tax joblessness tax work opportunity tax credits research and development tax credits unclaimed home real estate tax all of these other federal government programs.
The worker retention tax credit is a broad based refundable tax credit designed to motivate.
companies to keep employees on their payroll. The credit is 50% of approximately $10,000 in salaries paid by an.
company whose business is totally or partly suspended because of COVID-19 or whose gross invoices.
decrease by more than 50%.
1. The credit is offered to all companies regardless of size consisting of tax exempt companies. There are.
only 2 exceptions: (1) state and city governments and their instrumentalities and (2) little.
companies who take Small Business Loans.
2. To certify, the employer needs to satisfy one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the employer’s organization is fully or partially 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. Once the.
employer’s gross invoices go above 80% of a similar quarter in 2019 they no longer qualify.
after the end of that quarter.
Estimation of the Credit.
The amount of the credit is 50% of the qualifying incomes paid up to $10,000 in overall.
It works for wages paid after March 13th and before December 31, 2020.
The meaning of certifying salaries varies by whether a company had, typically, more or less than.
100 employees in 2019.
Business that specialize in ERC filing support generally provide competence and assistance to help companies browse the complex process of declaring the credit. They can provide different services, consisting of:.
How is the employee retention credit calculated? How To Apply Employee Retention Credit
Eligibility Assessment: These companies will examine your organization’s eligibility for the ERC based upon aspects such as your market, earnings, and operations. If you satisfy the requirements for the credit and determine the optimum credit quantity you can declare, they can help determine.
Documents and Estimation: ERC filing services will assist in collecting the necessary paperwork, such as payroll records and monetary statements, to support your claim. They will likewise help compute the credit quantity based upon eligible wages and other qualifying costs.
Retroactive Claim Review: If you are qualified to declare the ERC for prior quarters, these business can evaluate your previous payroll records and financials to identify potential opportunities for retroactive credits. They can assist you modify previous tax returns to claim these refunds.
Filing Support: Business specializing in ERC filings will prepare and submit the required kinds and documents on your behalf. This includes completing Form 941 or any other necessary tax forms.
Compliance and Updates: ERC guidelines and guidance have actually progressed in time. These business remain updated with the most recent modifications and guarantee that your filings adhere to the most existing standards. If the Internal revenue service demands additional details or carries out an audit related to your ERC claim, they can also provide continuous assistance.
It is essential to research and vet any business using ERC filing assistance to ensure their reliability and knowledge. Look for established firms with experience in tax and payroll services, or think about reaching out to trusted accounting companies or tax specialists who provide ERC filing assistance.
Bear in mind that while these business can provide important help, it’s always an excellent concept to have a standard understanding of the ERC requirements and process yourself. This will assist you make notified choices and guarantee precise filings.
The Worker Retention Credit (ERC) is a refundable tax credit presented by the U.S. federal government as part of COVID-19 relief procedures. The objective of the ERC is to encourage services to maintain and pay their employees throughout the pandemic, even if their operations have been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is available to qualified companies, consisting of for-profit services, tax-exempt companies, and certain governmental entities. To qualify, employers must fulfill one of two criteria:.
Business operations were totally or partially suspended due to a government order related to COVID-19.
Business experienced a significant decline in gross invoices. As mentioned previously, 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 substantial decrease is defined as a 20% decrease in gross invoices compared to the same quarter in 2019, or a 20% decrease in gross invoices compared to the instantly preceding quarter.
Credit Amount: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit quantity amounts to a percentage (as much as 70%) of qualified earnings paid to staff members, including particular health plan expenses. 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, companies that got a Paycheck Protection Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 enables services to claim the ERC even if they received a PPP loan. The same incomes can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively expanded and improved, allowing eligible employers to declare the credit for qualified salaries paid as far back as March 13, 2020. This retroactive arrangement offers a chance for companies to change prior-year income tax return and get refunds.
Declaring the Credit: Companies can declare the ERC by reporting it on their work tax returns, typically Form 941. If the credit exceeds the amount of work taxes owed, the excess can be refunded to the company.
It’s important to note that the ERC arrangements and eligibility requirements have actually progressed in time. The best strategy is to seek advice from a tax professional or check out the main IRS site for the most current and in-depth information relating to the ERC, including any current legislative modifications or updates.
To receive the ERC, a company needs to fulfill among the following requirements:.
Business operations were fully or partially suspended due to a federal government order related to COVID-19.
Business experienced a substantial decline in gross invoices. For 2021, a considerable decrease 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 specified as a 20% decline in gross receipts compared to the exact same quarter in 2019, or a 20% decline in gross invoices compared to the right away preceding quarter.
The ERC is available to businesses of all sizes, consisting of tax-exempt organizations, however there are some exceptions. Government entities and organizations that got a PPP loan may have constraints on claiming the credit.
The procedure for claiming the ERC includes completing the essential kinds and including the credit on your employment tax return (usually Kind 941). The exact time it takes to process the credit can differ based on numerous elements, consisting of the intricacy of your service and the workload of the internal revenue service. It’s suggested to speak with a tax expert for assistance specific to your circumstance.
There are a number of business that can help with the procedure of declaring the ERC. These include accounting companies, tax advisory services, and payroll company. Some popular business that provide support with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s a good idea to research and call these companies straight to ask about their services and charges.
Please note that the details supplied here is based upon basic knowledge and may not show the most recent updates or modifications to the ERC. It is necessary to speak with a tax professional or visit the main internal revenue service site for the most current and precise details relating to eligibility, declaring procedures, and readily available help.
Less than 100. If the company had 100 or less staff members usually in 2019, then the credit is based.
on salaries paid to all workers whether they actually worked or not. In other words, even if the.
workers worked full-time and made money for full-time work, the employer still gets the credit.
Greater than 100. If the employer had more than 100 workers usually in 2019, then the credit is.
allowed just for wages paid to employees who did not work throughout the calendar quarter.
In both cases, “salaries” includes not just cash payments but also a portion of the expense of employer.
provided health care. How To Apply Employee Retention Credit
Employers can be instantly reimbursed for the credit by minimizing the quantity of payroll taxes they.