Lets talk first about Who Qualifies For The Employee Retention Credit :
Our group here what do these people doing everyone in this space is helping teach individuals about ERC and uh constantly offer a lovely breakfast and have people actually learn about the program we need to head to the space 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 numerous countless dollars literally Kevin hundreds of countless dollars so these are replicate copies of the letters that go to clients confirming that the check is on the way I indicate you know if you simply begin to 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 suggest it’s simply I suggest consider the number of real clients 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 confirmed and the check is on the mail in the mail from the IRS heading to the consumer so that’s how you have the ability to track it you understand when you
receive this you know the check is gone for sure which’s when they pay so they do not pay anything up until they really 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 checking account and they can really rely on Wonder trust that the procedure has been ended up and the number of you think you have actually processed considering that you began this we have to do with 35 000 of these for
about 6 billion dollars wow so plainly they understand 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 really important today the worker retention credit which the majority of you have actually never heard of I definitely had not become aware of it until really just recently and discovered a lot about it because this is most likely the lowest cost of capital for any small company 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 biggest processor of these ERC credits this is a 170 page program so it’s challenging this isn’t like PPP we simply call up your bank manager and state give 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 like this program it’s disappearing soon you got to find out everything about it let’s talk worker retention credit Josh Fox what is an ERC let’s simply begin there so during the Trump Administration when President Trump was enacted they created the cares Act and the cares act offered businesses three chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically everyone it makes a huge difference right there two of them are loans and one’s a refund exactly so the ERC is a refund that’s.
fix the money cash payroll tax refund all right 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 cash money 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 original cares Act is the ERC and yes Kevin it is a lovely hard check in the mail where you get real money from the internal revenue service all right so let’s discuss how it works because it sounds like to me if it’s a if it’s worker retention credit that individual had to be an employee 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 staff members right you needed to have owned a business 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 very first six months of 2021 on the W-2 proper so there were 6 quarters the program was open well stroll us through the six quarters so you had quarters two 3 and four of 2020 and you had quarters one two and three of 2021. okay so that’s how it’s measured you have to be on the W-2 throughout that duration now let’s talk my preferred part cash just how much can you get back per worker that was on a W-2 in those six quarters so the computation in 2020 to be exact Kevin is 50 of the employee’s wage to an optimum of 5 thousand dollars per worker for the year of 2020 and in 2021 the numbers increased to 70 of the staff member’s salary to an optimum of 7 thousand per quarter how did that take place um they simply changed the rules in.
2021 versus due to the fact that the turmoil of the pandemic so they wished 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 as much as 5 thousand Max and after that 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 worker that is because that’s a lot of money it is now there’s a caution here the PPP cash would have to be decreased from the twenty six thousand dollars so if you took PPP loan one and PPP loan two you would minimize the 26 000 so what we’re seeing typically Kevin is if you took PPP money someplace around ten thousand dollars an individual so let’s say hypothetically you owned a restaurant in New york city 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 huge undoubtedly now the huge question is why does no one know about this since look when I initially heard about this when I first met Josh you understand I have actually got great deals of financial investments in lots of business I’m a major advocate for entrepreneurship in America and make numerous lots of investments in entrepreneurs of which numerous suffered through the pandemic when I first heard about this I called BS I don’t think it because 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 which were well deserved and we used them wisely to survive during the pandemic so when I found out about this I said nah it can’t hold true however when I dug around I even called to my politician good friends Guv Senators they didn’t understand about it I suggest that’s how you know that’s how false information is that there’s no info out there then a bunch of individuals told me well you can’t get it since you took the PPP likewise not real so let’s ask Josh why does no one know about the employee retention credit you know 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 desired a PPP loan you would call Wells Fargo Citibank Bank of America any of the huge 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 just process procedure that’s all um and here there was mayhem due to the fact that remember in the initial cares act you could not do both programs so if you had done PPP you might refrain from doing ERC in the initial program and when they changed 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 made it clear to any person about how to.
do this does your CFO understand how to do this not actually she or he’s never done it in the past do the banks do it nope the banks do not do it the payroll business yeah some 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 service and bottom line my company Kevin has been in business since 2009 and we’ve been working with the federal government and the state federal government to recuperate cash for Fortune 500 Fortune 1000 business so a lot of our huge huge business customers have worked with bottom line to recuperate other federal government programs we’ve done sales tax and use tax unemployment tax work chance tax credits research and development tax credits unclaimed property real estate tax all of these other federal government programs.
The staff member 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 wages paid by an.
Since of COVID-19 or whose gross receipts, employer whose company is fully or partially suspended.
decline by more than 50%.
1. The credit is offered to all employers no matter size including tax exempt companies. There are.
just 2 exceptions: (1) state and city governments and their instrumentalities and (2) small.
organizations who take Small company Loans.
2. To qualify, the employer needs to fulfill one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the company’s service is fully or partially suspended by government order due to COVID-19.
throughout the calendar quarter or.
o the employer’s gross receipts are listed below 50% of the comparable quarter in 2019. When the.
company’s gross invoices go above 80% of a comparable quarter in 2019 they no longer qualify.
after the end of that quarter.
Computation of the Credit.
The amount of the credit is 50% of the qualifying salaries paid up to $10,000 in total.
It is effective for wages paid after March 13th and prior to December 31, 2020.
The definition of certifying salaries varies by whether an employer had, typically, basically than.
100 workers in 2019.
Business that focus on ERC filing assistance normally supply expertise and support to help businesses browse the complex procedure of claiming the credit. They can offer various services, consisting of:.
How is the employee retention credit calculated? Who Qualifies For The Employee Retention Credit
Eligibility Assessment: These companies will examine your business’s eligibility for the ERC based upon aspects such as your market, income, and operations. They can assist determine if you meet the requirements for the credit and identify the optimum credit amount you can declare.
Documents and Estimation: ERC filing services will assist in gathering the essential paperwork, such as payroll records and financial declarations, to support your claim. They will also help determine the credit amount based on eligible wages and other qualifying expenses.
Retroactive Claim Review: If you are eligible to declare the ERC for prior quarters, these business can evaluate your past payroll records and financials to identify potential opportunities for retroactive credits. They can help you change previous income tax return to declare these refunds.
Filing Support: Companies specializing in ERC filings will prepare and send the needed types and paperwork in your place. This includes finishing Kind 941 or any other required tax return.
Compliance and Updates: ERC policies and assistance have actually progressed gradually. These business stay updated with the most recent changes and guarantee that your filings abide by the most existing standards. If the IRS demands additional details or carries out an audit related to your ERC claim, they can also provide ongoing assistance.
It is very important to research study and veterinarian any business using ERC filing assistance to ensure their credibility and proficiency. Look for recognized firms with experience in tax and payroll services, or think about connecting to trusted accounting firms or tax professionals who offer ERC submitting support.
Remember that while these companies can supply important support, it’s constantly an excellent concept to have a fundamental understanding of the ERC requirements and process yourself. This will help you make informed choices and make sure precise filings.
The Employee Retention Credit (ERC) is a refundable tax credit presented by the U.S. federal government as part of COVID-19 relief measures. The goal of the ERC is to encourage businesses to keep and pay their employees 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 employers, including for-profit businesses, tax-exempt companies, and specific governmental entities. To qualify, employers need to fulfill one of two requirements:.
Business operations were fully or partly suspended due to a government order related to COVID-19.
Business experienced a significant decline in gross receipts. As pointed out previously, for 2021, a substantial decline is defined as a 20% decline in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a considerable decrease is defined as a 20% decrease in gross invoices compared to the exact same quarter in 2019, or a 20% decline in gross receipts compared to the right away preceding quarter.
Credit Amount: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit amount amounts to a percentage (up to 70%) of certified earnings paid to workers, consisting of particular health plan expenses. The maximum 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 Security Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 allows organizations 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, permitting eligible employers to declare the credit for certified salaries paid as far back as March 13, 2020. This retroactive provision provides an opportunity for services to amend prior-year income tax return and receive refunds.
Declaring the Credit: Companies can claim the ERC by reporting it on their work income tax return, generally Form 941. If the credit surpasses the amount of work taxes owed, the excess can be refunded to the employer.
It’s important to note that the ERC provisions and eligibility criteria have actually progressed in time. The best course of action is to speak with a tax expert or go to the official internal revenue service website for the most comprehensive and current details regarding the ERC, consisting of any recent legal changes or updates.
To qualify for the ERC, an organization must satisfy among the following criteria:.
The business operations were fully or partially suspended due to a government order related to COVID-19.
Business experienced a significant decrease in gross invoices. For 2021, a considerable decline is specified as a 20% decline in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a considerable decline is defined 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 right away preceding quarter.
The ERC is available to organizations of all sizes, including tax-exempt companies, however there are some exceptions. Government entities and companies that got a PPP loan may have constraints on claiming the credit.
The procedure for claiming the ERC involves finishing the required forms and consisting of the credit on your work income tax return (generally Type 941). The exact time it takes to process the credit can differ based on several factors, consisting of the intricacy of your company and the work of the IRS. It’s suggested to seek advice from a tax expert for guidance specific to your scenario.
There are a number of business that can aid with the process of claiming the ERC. These include accounting firms, tax advisory services, and payroll company. Some well-known companies that use assistance with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s a good idea to research study and contact these companies straight to inquire about their charges and services.
Please note that the details offered here is based on basic understanding and might not show the most current updates or changes to the ERC. It’s important to consult with a tax professional or go to the main IRS website for the most precise and up-to-date info regarding eligibility, claiming procedures, and available assistance.
Less than 100. The credit is based if the company had 100 or fewer staff members on average in 2019.
on earnings paid to all staff members whether they really worked or not. Simply put, even if the.
employees worked full time and got paid 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.
allowed only for incomes paid to employees who did not work throughout the calendar quarter.
In both cases, “wages” consists of not simply money payments but likewise a part of the expense of company.
supplied health care. Who Qualifies For The Employee Retention Credit
Employers can be instantly repaid for the credit by decreasing the quantity of payroll taxes they.