Lets talk first about Self Employed Employee Retention Credit :
Our group here what do these guys doing everybody in this room is helping teach people about ERC and uh constantly offer a gorgeous breakfast and have people really learn more about the program we must head to the room where we are able to show some of the checks that we are getting for business and I want to see that what is this this is uh hundreds of millions of dollars literally Kevin numerous millions of dollars so these are duplicate copies of the letters that go to clients validating that the check is on the method I imply you know if you just 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 imply it’s simply I mean think about how many real clients that went through the program yeah this is the very end this is the party at the end when the check is confirmed the numbers are verified 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 understand when you
get this you know the check is gone for sure which’s when they pay so they don’t pay anything until they in fact receive the cash they do not pay bottom line Wonder trust anything till this letter is confirmed the check is on the way they deposit it into their checking account and they can genuinely rely on Wonder trust that the procedure has actually been finished and the number of you think you have actually processed given that you began this we have to do with 35 000 of these for
about six billion dollars wow so plainly they understand what they’re doing which’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 Wonderful here you’re at my YouTube channel we’re speaking about something actually essential today the worker retention credit which the majority of you have actually never heard of I definitely had not become aware of it until extremely just recently and discovered a lot about it since this is most likely the lowest expense of capital for any small business anywhere
anytime if you have employees in between 5 and five hundred so I have actually got the specialist with me this is Josh Fox he’s the creator and CEO of bottom line Concepts they’re the largest processor of these ERC credits this is a 170 page program so it’s hard this isn’t like PPP we simply contact your bank supervisor and say 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 love this program it’s disappearing very soon you got to learn all about it let’s talk employee retention credit Josh Fox what is an ERC let’s simply start there so during 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 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 money cash payroll tax refund fine go on sorry I just have to make sure we got that point I mean that’s a huge distinction a loan versus cash cash I like money cash that’s what we’re discussing 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 stunning hard check in the mail where you get real cash from the IRS all right so let’s speak about how it works because it seems like to me if it’s a if it’s worker retention credit that individual needed to be a staff member so I’m going to make the Assumption this money is not for the owner not for people on the cap table not for shareholders it’s for workers right you needed to have actually owned a business but it’s based on you having W-2 staff members 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 first six months of 2021 on the W-2 correct so there were six quarters the program was open well stroll us through the 6 quarters so you had quarters two 3 and 4 of 2020 and you had quarters one two and three of 2021. okay so that’s how it’s determined you need to be on the W-2 throughout that period now let’s talk my favorite part cash how much can you return per worker that was on a W-2 in those 6 quarters so the estimation in 2020 to be specific Kevin is 50 of the worker’s wage to an optimum of five thousand dollars per worker for the year of 2020 and in 2021 the numbers escalated to 70 of the worker’s income to a maximum of seven thousand per quarter how did that occur um they just changed 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 staff members 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 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 five thousand in twenty twenty that’s twenty six thousand dollars per worker that is since that’s a lot of money it is now there’s a caution here the PPP money would need to be minimized from the twenty six thousand dollars so if you took PPP loan one and PPP loan two you would decrease 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 employees and you took PPP cash you would still get a million dollar in the mail from the internal revenue service so it’s huge certainly now the huge question is why does no one learn about this since appearance when I initially heard about this when I initially fulfilled Josh you understand I’ve got lots of investments in lots of companies I’m a significant advocate for entrepreneurship in America and make many lots of investments in business owners of which many suffered through the pandemic when I initially became aware of this I called BS I don’t believe it since I use the PPP we went through the cash center Banks to get it it was really 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 survive throughout the pandemic so when I heard about this I said nah it can’t be true however when I dug around I even contacted us to my political leader good friends Guv Senators they didn’t understand about it I imply that’s how you know that’s how misinformation is that there’s no info out there then a lot of people told me well you can’t get it since you took the PPP also not true so let’s ask Josh why does nobody learn about the employee retention credit you know what’s fascinating you’re discussing the banks Kevin because in the PPP loan procedure 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 just procedure process that’s all um and here there was mayhem due to the fact that keep in mind in the initial cares act you could refrain from doing both programs so if you had actually done PPP you might refrain from doing ERC in the original program and when they changed the law in 2021 the banks were not doing ERC since it’s not alone so you’re getting a tax refund so the government never 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 ever done it previously do the banks do it nope the banks do not do it the payroll companies yeah a few of them are doing it as a payroll business your accounting professional no your accountant’s never done this prior to unless you have an account that entered into this company and bottom line my company Kevin has actually been in business considering that 2009 and we’ve been dealing with the federal government and the state federal government to recuperate cash for Fortune 500 Fortune 1000 companies so a lot of our huge huge corporate customers have dealt with bottom line to recuperate other federal government programs we have actually done sales tax and use tax joblessness tax work chance tax credits research and development tax credits unclaimed property property tax all of these other government programs.
The worker retention tax credit is a broad based refundable tax credit developed to motivate.
employers to keep workers on their payroll. The credit is 50% of as much as $10,000 in incomes paid by an.
Since of COVID-19 or whose gross invoices, company whose company is completely or partly suspended.
decrease by more than 50%.
1. The credit is readily available to all companies no matter size including tax exempt organizations. There are.
only 2 exceptions: (1) state and local governments and their instrumentalities and (2) little.
businesses who take Small Business Loans.
2. To certify, the employer has to satisfy one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the employer’s business is completely or partially suspended by government order due to COVID-19.
during the calendar quarter or.
o the employer’s gross receipts are listed below 50% of the equivalent quarter in 2019. Once the.
company’s gross receipts go above 80% of an equivalent 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 earnings paid up to $10,000 in total.
It works for wages paid after March 13th and prior to December 31, 2020.
The meaning of qualifying salaries differs by whether a company had, typically, basically than.
100 workers in 2019.
Business that concentrate on ERC filing help usually offer proficiency and assistance to help businesses browse the complicated procedure of declaring the credit. They can provide various services, including:.
How is the employee retention credit calculated? Self Employed Employee Retention Credit
Eligibility Assessment: These companies will examine your service’s eligibility for the ERC based upon elements such as your market, profits, and operations. They can assist figure out if you meet the requirements for the credit and recognize the optimum credit amount you can declare.
Paperwork and Computation: ERC filing services will help in collecting the essential documentation, such as payroll records and monetary declarations, to support your claim. They will also help compute the credit amount based upon qualified wages and other certifying expenses.
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 identify prospective opportunities for retroactive credits. They can help you modify prior income tax return to declare these refunds.
Filing Support: Business concentrating on ERC filings will prepare and submit the necessary kinds and paperwork on your behalf. This consists of completing Type 941 or any other required tax return.
Compliance and Updates: ERC regulations and assistance have progressed over time. These companies remain updated with the current modifications and make sure that your filings comply with the most current standards. If the IRS demands additional info or conducts an audit associated to your ERC claim, they can also provide continuous assistance.
It is very important to research and veterinarian any business offering ERC filing help to ensure their trustworthiness and expertise. Look for established companies with experience in tax and payroll services, or consider connecting to relied on accounting firms or tax specialists who use ERC filing assistance.
Keep in mind that while these companies can provide important help, it’s always a great idea to have a standard understanding of the ERC requirements and process yourself. This will assist you make notified choices and guarantee accurate filings.
The Employee Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief measures. The objective of the ERC is to motivate organizations to retain and pay their employees throughout 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 organizations, tax-exempt organizations, and certain governmental entities. To qualify, companies must meet one of two requirements:.
The business operations were totally or partially suspended due to a government order related to COVID-19.
The business experienced a considerable decline in gross invoices. As discussed previously, for 2021, a significant decline is defined as a 20% decline in gross invoices compared to the very same quarter in 2019. For 2022 and beyond, a substantial decrease is defined as a 20% decrease in gross receipts compared to the very 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 is equal to a portion (as much as 70%) of qualified incomes paid to staff members, including certain health plan 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, companies that received a Paycheck Protection Program (PPP) loan were not eligible for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 allows organizations to declare the ERC even if they received a PPP loan. The exact same wages can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively expanded and boosted, permitting eligible employers to claim the credit for certified salaries paid as far back as March 13, 2020. This retroactive provision supplies a chance for services to change prior-year tax returns and get refunds.
Claiming the Credit: Employers can claim the ERC by reporting it on their work income tax return, usually Kind 941. If the credit surpasses the amount of employment taxes owed, the excess can be refunded to the employer.
It is necessary to keep in mind that the ERC arrangements and eligibility criteria have evolved gradually. The very best course of action is to seek advice from a tax professional or go to the main IRS website for the most current and comprehensive info concerning the ERC, consisting of any current legislative modifications or updates.
To receive the ERC, a service needs to satisfy one of the following criteria:.
The business operations were fully or partly suspended due to a government order related to COVID-19.
Business experienced a substantial decrease 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 significant decrease is specified as a 20% decline in gross receipts compared to the very same quarter in 2019, or a 20% decline in gross invoices compared to the immediately preceding quarter.
The ERC is readily available to companies of all sizes, consisting of tax-exempt organizations, however there are some exceptions. Government entities and businesses that received a PPP loan might have constraints on claiming the credit.
The process for claiming the ERC involves completing the required forms and consisting of the credit on your employment income tax return (normally Kind 941). The exact time it takes to process the credit can differ based upon numerous elements, consisting of the complexity of your company and the workload of the internal revenue service. It’s recommended to speak with a tax expert for guidance particular to your scenario.
There are a number of companies that can aid with the process of declaring the ERC. These include accounting firms, tax advisory services, and payroll provider. Some popular companies that provide help with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s advisable to research study and get in touch with these companies straight to inquire about their costs and services.
Please note that the details offered here is based upon general knowledge and may not reflect the most current updates or changes to the ERC. It’s important to speak with a tax professional or visit the official IRS website for the most up-to-date and precise information concerning eligibility, claiming procedures, and offered assistance.
Less than 100. The credit is based if the company had 100 or fewer workers on average in 2019.
on incomes paid to all staff members whether they really worked or not. In other words, even if the.
staff members worked full-time and earned money for full-time work, the employer still gets the credit.
Greater than 100. If the company had more than 100 workers typically in 2019, then the credit is.
permitted only for salaries paid to workers who did not work throughout the calendar quarter.
In both cases, “wages” includes not just cash payments but also a portion of the expense of company.
supplied healthcare. Self Employed Employee Retention Credit
Companies can be right away reimbursed for the credit by lowering the quantity of payroll taxes they.