Lets talk first about Cares Act Employee Retention Credits :
Our team here what do these guys doing everybody in this room is assisting teach people about ERC and uh constantly offer a lovely breakfast and have individuals really learn about the program we need to head to the space where we are able to display some of the checks that we are getting for companies and I ‘d like to see that what is this this is uh numerous countless dollars actually Kevin hundreds of millions of 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 simply begin 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 mean it’s simply I imply consider how many real clients that went through the program yeah this is the very end this is the celebration at the end when the check is confirmed the numbers are confirmed 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 understand the check is gone for sure which’s when they pay so they don’t pay anything till they in fact get the money they don’t pay bottom line Wonder trust anything until this letter is validated the check is on the way they deposit it into their bank account and they can really trust Wonder trust that the procedure has actually been ended up and how many you believe you’ve processed considering that you began this we have to do with 35 000 of these for
about six billion dollars wow so clearly they understand what they’re doing which’s what you need you require specialists on the other end of the phone to process this and get it to where you get among these that’s what matters all right Mr Terrific here you’re at my YouTube channel we’re discussing something actually important today the staff member retention credit which most of you have actually never heard of I certainly had not become aware of it up until extremely recently and found out a lot about it because this is probably the most affordable expense of capital for any small business anywhere
anytime if you have staff members in between 5 and five hundred so I have actually 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 difficult this isn’t like PPP we just contact your bank manager and state 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 ended up being yes the Ambassador and paid representative for this I enjoy this program it’s disappearing very soon you got to find out everything about it let’s talk staff member retention credit Josh Fox what is an ERC let’s just start there so during the Trump Administration when President Trump was enacted they came up with the cares Act and the cares act offered companies three opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly everybody it makes a huge difference right there 2 of them are loans and one’s a refund exactly so the ERC is a refund that’s.
fix the cash money payroll tax refund fine go on sorry I just need to ensure we got that point I mean that’s a huge difference a loan versus money cash I like money money that’s what we’re speaking 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 stunning tough check in the mail where you get real money from the internal revenue service all right so let’s speak about how it works due to the fact that it sounds like to me if it’s a if it’s staff member retention credit that person needed to be a worker so I’m going to make the Assumption this money is not for the owner not for people on the cap table not for investors it’s for employees right you had to have actually owned a company 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 very first six 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 3 and four of 2020 and you had quarters one two and 3 of 2021. all right so that’s how it’s measured you need to be on the W-2 during that duration now let’s talk my preferred part money how much can you return per staff member 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 a maximum of 5 thousand dollars per staff member for the year of 2020 and in 2021 the numbers increased to 70 of the employee’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 mayhem of the pandemic so they wanted 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 5 thousand Max and then what takes place 21 000 Max in 2021 oh that’s how you create twenty six thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty six thousand dollars per staff member that is because that’s a great deal of cash it is now there’s a caution here the PPP cash would have to be decreased from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan two you would lower the 26 000 so what we’re seeing usually Kevin is if you took PPP money somewhere around 10 thousand dollars a person so let’s say hypothetically you owned a restaurant in New york city City where I’m from and you had a hundred workers and you took PPP money you would still get a million dollar in the mail from the IRS so it’s substantial undoubtedly now the big concern is why does nobody know about this because appearance when I initially became aware of this when I initially satisfied Josh you know I have actually got great deals of investments in lots of business I’m a major supporter for entrepreneurship in America and make lots of numerous financial investments in business owners of which numerous suffered through the pandemic when I initially heard about this I called BS I don’t think it since I use the PPP we went through the cash center Banks to get it it was extremely easy to do we had our CEOs call the banks they got their loans which were well should have and we used them sensibly to stay alive during the pandemic so when I became aware of this I stated nah it can’t hold true but when I dug around I even called to my politician friends Guv Senators they didn’t learn 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 no one know about the employee retention credit you understand what’s interesting you’re talking about the banks Kevin since in the PPP loan procedure the federal government made it extremely clear that if you wanted 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 simply process procedure that’s all um and here there was mayhem since keep in mind in the original cares act you might refrain from doing both programs so if you had actually done PPP you might not do ERC in the original program and when they altered the law in 2021 the banks were refraining from doing ERC because it’s not alone so you’re getting a tax refund so the government never ever made it clear to anybody about how to.
do this does your CFO understand how to do this not actually he or she’s never ever done it in the past do the banks do it nope the banks don’t do it the payroll business yeah some of them are doing it as a payroll business your accountant no your accountant’s never ever done this prior to unless you have an account that entered into this organization 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 money for Fortune 500 Fortune 1000 companies so a lot of our huge big business clients have dealt with bottom line to recuperate other federal government programs we have actually done sales tax and utilize tax unemployment tax work chance tax credits research and development tax credits unclaimed property real estate tax all of these other government programs.
The employee retention tax credit is a broad based refundable tax credit created to encourage.
employers to keep employees on their payroll. The credit is 50% of approximately $10,000 in incomes paid by an.
Since of COVID-19 or whose gross invoices, employer whose business is totally or partially suspended.
decrease by more than 50%.
1. The credit is readily available to all employers regardless of size including tax exempt companies. There are.
just two exceptions: (1) state and local governments and their instrumentalities and (2) little.
companies who take Small Business Loans.
2. To qualify, the company has 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 company’s gross invoices are listed below 50% of the similar quarter in 2019. As soon as the.
employer’s gross invoices exceed 80% of a similar quarter in 2019 they no longer qualify.
after completion of that quarter.
Computation of the Credit.
The quantity of the credit is 50% of the qualifying wages paid up to $10,000 in total.
It works 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, more or less than.
100 employees in 2019.
Business that concentrate on ERC filing support typically supply know-how and assistance to help services browse the complex procedure of claiming the credit. They can provide different services, including:.
How is the employee retention credit calculated? Cares Act Employee Retention Credits
Eligibility Evaluation: These business will assess your business’s eligibility for the ERC based upon factors such as your industry, revenue, and operations. If you satisfy the requirements for the credit and determine the maximum credit amount you can claim, they can help figure out.
Documentation and Estimation: ERC filing services will help in collecting the required documents, such as payroll records and monetary statements, to support your claim. They will also assist determine the credit amount based on qualified earnings and other certifying expenses.
Retroactive Claim Evaluation: If you are eligible to declare the ERC for previous quarters, these companies can evaluate your past payroll records and financials to identify possible opportunities for retroactive credits. They can assist you amend previous income tax return to declare these refunds.
Filing Support: Companies specializing in ERC filings will prepare and send the necessary forms and documentation on your behalf. This consists of finishing Type 941 or any other required tax forms.
Compliance and Updates: ERC regulations and assistance have evolved in time. These companies remain upgraded with the current changes and guarantee that your filings comply with the most current guidelines. If the IRS demands additional details or conducts an audit associated to your ERC claim, they can likewise offer continuous support.
It is very important to research study and veterinarian any business using ERC filing assistance to guarantee their credibility and competence. Look for established firms with experience in tax and payroll services, or think about connecting to relied on accounting firms or tax professionals who provide ERC submitting support.
Remember that while these business can offer important assistance, it’s constantly a great idea to have a basic understanding of the ERC requirements and process yourself. This will help you make notified decisions and ensure precise filings.
The Worker 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 businesses to keep and pay their staff members during the pandemic, even if their operations have been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is offered to eligible companies, consisting of for-profit organizations, tax-exempt companies, and particular governmental entities. To certify, employers should satisfy one of two requirements:.
The business operations were completely or partially suspended due to a government order related to COVID-19.
Business experienced a significant decline in gross invoices. As pointed out previously, for 2021, a significant decline is specified as a 20% decline in gross invoices compared to the exact 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 invoices compared to the immediately preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit amount is equal to a portion (up to 70%) of qualified earnings paid to staff members, including specific health insurance expenses. The maximum credit per employee is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: At first, businesses that got an Income Security Program (PPP) loan were not qualified for the ERC. However, legislation passed in late 2020 and extended in 2021 allows organizations to declare the ERC even if they received a PPP loan. The very same incomes can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has actually been retroactively expanded and enhanced, permitting qualified employers to declare the credit for certified salaries paid as far back as March 13, 2020. This retroactive provision provides a chance for companies to amend prior-year income tax return and get refunds.
Claiming the Credit: Companies can claim the ERC by reporting it on their work tax returns, normally Type 941. The excess can be reimbursed to the employer if the credit surpasses the amount of employment taxes owed.
It’s important to note that the ERC provisions and eligibility requirements have progressed over time. The best strategy is to consult with a tax expert or visit the main internal revenue service site for the most in-depth and updated details relating to the ERC, consisting of any recent legal changes or updates.
To receive the ERC, a company needs to satisfy among the following criteria:.
The business operations were totally or partially suspended due to a federal government order related to COVID-19.
The business experienced a considerable decline in gross receipts. For 2021, a substantial decline 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 defined as a 20% decline in gross invoices compared to the same quarter in 2019, or a 20% decline in gross receipts compared to the immediately preceding quarter.
The ERC is available to services of all sizes, including tax-exempt companies, but there are some exceptions. Federal government entities and organizations that got a PPP loan may have limitations on declaring the credit.
The procedure for declaring the ERC includes completing the required types and consisting of the credit on your employment tax return (typically Kind 941). The exact time it takes to process the credit can differ based upon numerous factors, consisting of the complexity of your business and the work of the IRS. It’s advised to talk to a tax expert for guidance particular to your situation.
There are a number of business that can assist with the procedure of declaring the ERC. These consist of accounting companies, tax advisory services, and payroll company. Some well-known business that offer help with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s advisable to research and get in touch with these companies directly to inquire about their fees and services.
Please note that the info supplied here is based on basic understanding and may not reflect the most current updates or modifications to the ERC. It is essential to consult with a tax professional or check out the official IRS website for the most precise and up-to-date information relating to eligibility, declaring treatments, and available help.
Less than 100. The credit is based if the company had 100 or fewer employees on average in 2019.
on salaries paid to all employees whether they in fact worked or not. To put it simply, even if the.
workers worked full time and earned money for full time work, the company still gets the credit.
Greater than 100. If the employer had more than 100 staff members usually in 2019, then the credit is.
allowed only for earnings paid to staff members who did not work throughout the calendar quarter.
In both cases, “salaries” includes not simply cash payments however also a part of the cost of company.
offered healthcare. Cares Act Employee Retention Credits
Employers can be immediately repaid for the credit by lowering the quantity of payroll taxes they.