Lets talk first about Who Is Eligible For Employee Retention Credit :
Our team here what do these guys doing everybody in this room is helping teach people about ERC and uh always supply a lovely breakfast and have individuals actually discover the program we ought to head to the room where we have the ability to display some of the checks that we are getting for business and I ‘d like to see that what is this this is uh hundreds of countless dollars actually Kevin numerous countless dollars so these are duplicate copies of the letters that go to clients confirming that the check is on the way I mean you understand if you simply begin to take a look at some of these here I suggest this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I mean it’s just I suggest consider the number of actual customers that went through the program yeah this is the very end this is the party at the end when the check is validated the numbers are verified and the check is on the mail in the mail from the internal revenue service heading to the client so that’s how you have the ability 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 get the cash 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 savings account and they can truly rely on Wonder trust that the procedure has actually been completed and the number of you believe you have actually processed considering that you started this we’re about 35 000 of these for
about 6 billion dollars wow so plainly they understand what they’re doing which’s what you need 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 Wonderful here you’re at my YouTube channel we’re discussing something truly essential today the staff member retention credit which most of you have actually never heard of I certainly hadn’t become aware of it till extremely just recently and learned a lot about it because this is most likely the lowest cost of capital for any small business anywhere
anytime if you have staff members 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 Ideas 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 just 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 inform us all about it and how to get it and why I’ve ended up being yes the Ambassador and paid representative for this I like this program it’s going away very soon you got to discover everything about it let’s talk worker retention credit Josh Fox what is an ERC let’s simply start there so throughout 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 everybody it makes a big distinction right there 2 of them are loans and one’s a refund exactly so the ERC is a refund that’s.
remedy the cash cash payroll tax refund okay go on sorry I simply need to ensure we got that point I suggest that’s a huge difference a loan versus cash money I like cash money 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 beautiful 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 sounds like to me if it’s a if it’s staff member retention credit that person 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 investors it’s for employees right you had to have owned a company but it’s based on you having W-2 workers 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 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 three and 4 of 2020 and you had quarters one two and 3 of 2021. alright 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 cash how much can you return per worker that was on a W-2 in those six quarters so the calculation in 2020 to be specific Kevin is 50 of the staff member’s income to a maximum of five 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 simply altered the rules in.
2021 versus since the mayhem 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 as much as five thousand Max and then what takes place 21 000 Max in 2021 oh that’s how you create twenty 6 thousand twenty one thousand to twenty twenty one plus five thousand in twenty twenty that’s twenty 6 thousand dollars per staff member that is because that’s a great deal of money it is now there’s a caveat here the PPP cash would need to be minimized 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 usually Kevin is if you took PPP money somewhere around ten thousand dollars a person so let’s state 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 IRS so it’s big undoubtedly now the huge question is why does nobody know about this because look when I initially became aware of this when I first satisfied Josh you know I’ve got great deals of investments in lots of companies I’m a significant supporter for entrepreneurship in America and make numerous 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 believe it since I utilize the PPP we went through the cash 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 utilized them wisely to survive during the pandemic so when I became aware of this I said nah it can’t hold true however when I dug around I even called to my politician friends Governor Senators they didn’t know about it I imply that’s how you know that’s how false information is that there’s no information out there then a lot of individuals told me well you can’t get it since you took the PPP likewise not true so let’s ask Josh why does nobody understand about the staff member retention credit you know what’s interesting 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 procedure in Canada a pre-pp loan there’s no loans in Canada by the way it’s just process procedure that’s all um and here there was mayhem due to the fact that keep in mind in the original cares act you might not do 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 federal government never ever made it clear to anybody about how to.
do this does your CFO know how to do this not really she or he’s never ever done it previously 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 business your accountant no your accountant’s never ever done this before unless you have an account that went into this company and bottom line my firm Kevin has stayed in business because 2009 and we’ve been dealing with the federal government and the state federal government to recuperate money for Fortune 500 Fortune 1000 business so a great deal of our huge big corporate customers have worked with bottom line to recover other government programs we’ve done sales tax and use tax unemployment tax work opportunity tax credits research and development tax credits unclaimed property real estate tax all of these other federal 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 earnings paid by an.
Because of COVID-19 or whose gross receipts, employer whose service is fully or partly suspended.
decrease by more than 50%.
1. The credit is available to all companies no matter size consisting of tax exempt companies. There are.
only 2 exceptions: (1) state and local governments and their instrumentalities and (2) small.
services who take Small company Loans.
2. To certify, the employer needs to meet one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the employer’s business is completely or partly 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 similar quarter in 2019. When the.
employer’s gross invoices exceed 80% of a similar quarter in 2019 they no longer certify.
after completion of that quarter.
Estimation of the Credit.
The quantity of the credit is 50% of the qualifying incomes paid up to $10,000 in overall.
It is effective for incomes paid after March 13th and prior to December 31, 2020.
The meaning of qualifying incomes differs by whether a company had, on average, basically than.
100 staff members in 2019.
Business that specialize in ERC filing assistance generally supply knowledge and support to assist services navigate the complex procedure of declaring the credit. They can offer various services, consisting of:.
How is the employee retention credit calculated? Who Is Eligible For Employee Retention Credit
Eligibility Assessment: These business will examine your service’s eligibility for the ERC based upon elements such as your industry, income, and operations. They can help determine if you meet the requirements for the credit and identify the optimum credit amount you can claim.
Paperwork and Estimation: ERC filing services will assist in collecting the needed paperwork, such as payroll records and monetary statements, to support your claim. They will also help compute the credit amount based upon eligible incomes and other certifying costs.
Retroactive Claim Review: If you are qualified to declare the ERC for prior quarters, these companies can examine your previous payroll records and financials to recognize possible chances for retroactive credits. They can help you amend previous income tax return to claim these refunds.
Filing Assistance: Business focusing on ERC filings will prepare and submit the required forms and documentation in your place. This consists of completing Type 941 or any other required tax forms.
Compliance and Updates: ERC regulations and guidance have evolved gradually. These companies remain updated with the most recent changes and guarantee that your filings adhere to the most current guidelines. They can also provide ongoing assistance if the internal revenue service requests extra information or conducts an audit related to your ERC claim.
It is very important to research study and vet any business using ERC filing help to ensure their trustworthiness and know-how. Try to find recognized companies with experience in tax and payroll services, or think about connecting to relied on accounting companies or tax professionals who offer ERC filing support.
Bear in mind that while these business can provide important assistance, it’s always a great concept to have a standard understanding of the ERC requirements and process yourself. This will help you make informed choices and guarantee precise 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 objective of the ERC is to encourage services to keep and pay their staff members during the pandemic, even if their operations have actually been affected.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is available to qualified companies, consisting of for-profit organizations, tax-exempt organizations, and specific governmental entities. To certify, employers must fulfill one of two criteria:.
The business operations were fully or partly suspended due to a government order related to COVID-19.
Business experienced a considerable decline in gross receipts. As pointed out earlier, for 2021, a substantial decrease is defined as a 20% decline in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a considerable decrease is defined 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 instantly preceding quarter.
Credit Amount: The ERC is a refundable tax credit that offsets the employer’s share of Social Security taxes. The credit amount is equal to a portion (up to 70%) of certified salaries paid to employees, consisting of particular health insurance costs. The optimum credit per employee 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 Defense Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 allows companies to claim the ERC even if they got a PPP loan. Nevertheless, the same salaries can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has been retroactively broadened and improved, enabling eligible companies to claim the credit for qualified salaries paid as far back as March 13, 2020. This retroactive provision offers a chance for organizations to change prior-year tax returns and get refunds.
Declaring the Credit: Companies can declare the ERC by reporting it on their employment tax returns, usually Kind 941. The excess can be refunded to the company if the credit surpasses the quantity of work taxes owed.
It is very important to note that the ERC arrangements and eligibility criteria have progressed over time. The very best course of action is to seek advice from a tax expert or visit the main IRS website for the most updated and in-depth information regarding the ERC, consisting of any recent legal modifications or updates.
To receive the ERC, a business needs to fulfill among the following criteria:.
Business operations were totally or partially suspended due to a federal government order related to COVID-19.
Business experienced a substantial decrease in gross invoices. For 2021, a substantial decrease is defined as a 20% decline in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a considerable decrease is defined as a 20% decline in gross invoices 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 companies, but there are some exceptions. Government entities and businesses that got a PPP loan might have restrictions on declaring the credit.
The process for declaring the ERC involves completing the needed types and consisting of the credit on your employment tax return (typically Type 941). The exact time it requires to process the credit can vary based upon several elements, consisting of the intricacy of your service and the workload of the internal revenue service. It’s advised to consult with a tax professional for assistance specific to your circumstance.
There are numerous business that can help with the procedure of claiming the ERC. Some widely known companies that use support with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young.
Please note that the information supplied here is based on basic understanding and might not show the most recent updates or changes to the ERC. It is very important to talk to a tax professional or check out the main internal revenue service website for the most up-to-date and accurate details relating to eligibility, declaring procedures, and offered help.
Less than 100. The credit is based if the company had 100 or fewer staff members on average in 2019.
on salaries paid to all workers whether they really worked or not. Simply put, even if the.
employees worked full-time and earned money for full time work, the employer still gets the credit.
Greater than 100. The credit is if the employer had more than 100 workers on average in 2019.
enabled only for earnings paid to staff members who did not work during the calendar quarter.
In both cases, “salaries” consists of not just cash payments but also a portion of the cost of employer.
supplied health care. Who Is Eligible For Employee Retention Credit
Companies can be immediately repaid for the credit by decreasing the amount of payroll taxes they.