Lets talk first about Quickbooks Payroll Employee Retention Credit :
Our team here what do these guys doing everybody in this space is helping teach people about ERC and uh always supply a stunning breakfast and have individuals actually learn more about the program we ought to head to the space where we are able to display some 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 millions of dollars so these are replicate copies of the letters that go to clients confirming that the check is on the way I suggest you understand if you simply start to look at some of these here I indicate this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I imply it’s simply I mean consider the number of actual 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 validated and the check is on the mail in the mail from the IRS heading to the customer so that’s how you have the ability to track it you understand when you
get this you know the check is gone for sure and that’s when they pay so they don’t pay anything up until they in fact get the money they don’t pay bottom line Wonder trust anything till this letter is confirmed the check is on the way they transfer it into their bank account and they can genuinely rely on Wonder trust that the procedure has been ended up and how many you believe you have actually processed given that you began this we’re about 35 000 of these for
about six billion dollars wow so plainly they know what they’re doing and that’s what you require 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 discussing something really essential today the employee retention credit which the majority of you have actually never heard of I definitely hadn’t heard of it until extremely recently and learned a lot about it due to the fact that this is probably the lowest cost of capital for any small business anywhere
anytime if you have workers between 5 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 Concepts they’re the biggest processor of these ERC credits this is a 170 page program so it’s hard this isn’t like PPP we simply call up your bank manager and say provide me a loan it doesn’t work there’s not a loan it’s an application and Josh is going to tell all of us about it and how to get it and why I’ve ended up being yes the Ambassador and paid spokesperson for this I love this program it’s going away soon you got to discover all about it let’s talk worker retention credit Josh Fox what is an ERC let’s simply start there so during the Trump Administration when President Trump was enacted they created the cares Act and the cares act provided organizations three chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and almost 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.
correct the money cash payroll tax refund fine go on sorry I just need to make sure we got that point I suggest that’s a huge difference a loan versus cash money I like money cash that’s what we’re talking 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 initial cares Act is the ERC and yes Kevin it is a beautiful hard check in the mail where you get actual money from the IRS all right so let’s speak about how it works because it sounds like to me if it’s a if it’s employee retention credit that individual needed to be an employee so I’m going to make the Assumption this cash is not for the owner not for people on the cap table not for shareholders it’s for workers right you had to have actually owned a service but it’s based upon you having W-2 workers in America not 10.99. As long as you had W-2 employees 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 6 months of 2021 on the W-2 appropriate so there were 6 quarters the program was open well walk us through the 6 quarters so you had quarters two three and four of 2020 and you had quarters one 2 and three of 2021. okay so that’s how it’s determined you have to be on the W-2 during that period now let’s talk my favorite part cash just how much can you get back per staff member that was on a W-2 in those six quarters so the estimation in 2020 to be specific Kevin is 50 of the staff member’s salary to an optimum of five thousand dollars per worker for the year of 2020 and in 2021 the numbers increased to 70 of the staff member’s wage to an optimum of seven thousand per quarter how did that occur um they simply changed the rules in.
2021 versus because the chaos of the pandemic so they wished 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 occurs 21 000 Max in 2021 oh that’s how you create twenty 6 thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty 6 thousand dollars per employee that is because that’s a great deal of cash it is now there’s a caveat here the PPP cash would need to be decreased 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 usually 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 City where I’m from and you had a hundred employees and you took PPP cash you would still get a million dollar in the mail from the IRS so it’s substantial certainly now the huge question is why does no one understand about this because appearance when I initially found out about this when I initially met Josh you understand I’ve got great deals of investments in lots of companies I’m a significant advocate for entrepreneurship in America and make lots of lots of investments in entrepreneurs of which many suffered through the pandemic when I initially heard about this I called BS I don’t think it since 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 been worthy of and we used them sensibly to survive during the pandemic so when I found out about this I said nah it can’t be true but when I dug around I even contacted us to my politician friends Governor Senators they didn’t learn 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 individuals told me well you can’t get it because you took the PPP likewise not real so let’s ask Josh why does nobody learn about the staff member retention credit you understand what’s intriguing you’re speaking about the banks Kevin because in the PPP loan process the federal government made it extremely clear that if you desired a PPP loan you would call Wells Fargo Citibank Bank of America any of the big banks in our country and they would process process in Canada a pre-pp loan there’s no loans in Canada by the way it’s simply procedure procedure that’s all um and here there was turmoil since keep in mind in the original cares act you could refrain from doing both programs so if you had actually done PPP you could refrain from doing 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 truly he or she’s never done it in the past 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 accounting professional’s never ever done this before unless you have an account that entered into this service and bottom line my company Kevin has stayed in business since 2009 and we’ve been dealing with the federal government and the state government to recuperate money for Fortune 500 Fortune 1000 business so a lot of our huge big business customers have worked with bottom line to recuperate other government programs we have actually done sales tax and utilize tax joblessness tax work opportunity tax credits research and development tax credits unclaimed home property tax all of these other government programs.
The staff member retention tax credit is a broad based refundable tax credit designed to motivate.
employers to keep employees on their payroll. The credit is 50% of up to $10,000 in incomes paid by an.
company whose company is completely or partially suspended because of COVID-19 or whose gross invoices.
decline by more than 50%.
1. The credit is available to all companies despite size consisting of tax exempt organizations. There are.
only two 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 meet one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the employer’s company is fully 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.
company’s gross receipts exceed 80% of a comparable quarter in 2019 they no longer certify.
after the end of that quarter.
Calculation of the Credit.
The amount of the credit is 50% of the certifying salaries paid up to $10,000 in overall.
It works for wages paid after March 13th and prior to December 31, 2020.
The definition of qualifying salaries differs by whether a company had, usually, basically than.
100 workers in 2019.
Business that focus on ERC filing assistance generally supply expertise and assistance to help companies navigate the intricate process of declaring the credit. They can offer numerous services, consisting of:.
How is the employee retention credit calculated? Quickbooks Payroll Employee Retention Credit
Eligibility Evaluation: These companies will examine your business’s eligibility for the ERC based upon elements such as your market, earnings, and operations. If you fulfill the requirements for the credit and identify the optimum credit amount you can declare, they can assist identify.
Documents and Calculation: ERC filing services will assist in gathering the required documents, such as payroll records and financial statements, to support your claim. They will likewise assist compute the credit quantity based on eligible salaries and other certifying expenditures.
Retroactive Claim Evaluation: If you are qualified to claim the ERC for prior quarters, these business can examine your previous payroll records and financials to recognize potential opportunities for retroactive credits. They can help you modify prior tax returns to declare these refunds.
Filing Support: Business focusing on ERC filings will prepare and submit the needed kinds and documentation in your place. This consists of finishing Type 941 or any other required tax return.
Compliance and Updates: ERC policies and guidance have actually progressed gradually. These business remain upgraded with the most recent modifications and ensure that your filings adhere to the most current standards. They can also provide ongoing support if the internal revenue service demands extra info or carries out an audit related to your ERC claim.
It’s important to research and veterinarian any company offering ERC filing support to guarantee their reliability and know-how. Search for established firms with experience in tax and payroll services, or think about reaching out to relied on accounting firms or tax experts who use ERC filing support.
Remember that while these business can supply important support, it’s constantly an excellent concept to have a standard understanding of the ERC requirements and process yourself. This will help you make informed choices and ensure accurate filings.
The Worker Retention Credit (ERC) is a refundable tax credit introduced by the U.S. federal government as part of COVID-19 relief steps. The goal of the ERC is to motivate organizations to maintain and pay their staff members during 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 companies, and certain governmental entities. To qualify, companies should meet one of two requirements:.
The business operations were completely or partly suspended due to a federal government order related to COVID-19.
The business experienced a significant decline in gross invoices. As mentioned previously, for 2021, a considerable decrease is specified as a 20% decline in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a considerable decrease is specified as a 20% decrease 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 quantity amounts to a portion (up to 70%) of certified wages paid to staff members, consisting of certain health insurance 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: Initially, companies that got an Income Protection Program (PPP) loan were not qualified 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 very same wages can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively broadened and improved, allowing qualified employers to claim the credit for certified incomes paid as far back as March 13, 2020. This retroactive arrangement supplies an opportunity for businesses to modify prior-year income tax return and receive refunds.
Claiming the Credit: Employers can claim the ERC by reporting it on their employment income tax return, normally Kind 941. If the credit goes beyond the quantity of employment taxes owed, the excess can be reimbursed to the employer.
It is essential to keep in mind that the ERC arrangements and eligibility requirements have actually progressed gradually. The best course of action is to talk to a tax professional or go to the official IRS website for the most current and detailed info concerning the ERC, consisting of any recent legislative modifications or updates.
To get approved for the ERC, an organization needs to meet one of the following requirements:.
Business operations were totally or partly suspended due to a government order related to COVID-19.
Business experienced a substantial decrease in gross receipts. For 2021, a substantial decline is defined as a 20% decline in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a substantial decline is defined as a 20% decrease in gross invoices compared to the exact same quarter in 2019, or a 20% decrease in gross invoices compared to the instantly preceding quarter.
The ERC is available to services of all sizes, including tax-exempt companies, but there are some exceptions. For instance, federal government entities and organizations that got a PPP loan might have limitations on declaring the credit.
The process for claiming the ERC involves completing the necessary types and consisting of the credit on your work tax return (usually Type 941). The exact time it takes to process the credit can vary based upon numerous factors, including the complexity of your company and the workload of the IRS. It’s advised to consult with a tax expert for guidance particular to your circumstance.
There are numerous business that can assist with the process of declaring the ERC. These consist of accounting companies, tax advisory services, and payroll company. Some widely known companies that use assistance with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s a good idea to research and call these business straight to inquire about their costs and services.
Please keep in mind that the information supplied here is based on basic knowledge and may not show the most recent updates or modifications to the ERC. It is essential to seek advice from a tax expert or visit the official IRS site for the most current and accurate details concerning eligibility, claiming procedures, and offered assistance.
Less than 100. The credit is based if the company had 100 or less workers on average in 2019.
on wages paid to all workers whether they really worked or not. To put it simply, even if the.
workers worked full time and got paid for full time work, the company still gets the credit.
Greater than 100. The credit is if the employer had more than 100 workers on average in 2019.
allowed just for salaries paid to staff members who did not work throughout the calendar quarter.
In both cases, “earnings” includes not just cash payments however likewise a part of the cost of employer.
supplied health care. Quickbooks Payroll Employee Retention Credit
Employers can be instantly repaid for the credit by lowering the amount of payroll taxes they.