Lets talk first about Employee Retention Credit For Third Quarter 2021 :
Our team here what do these people doing everyone in this space is assisting teach individuals about ERC and uh constantly provide a gorgeous breakfast and have individuals actually discover the program we should head to the room where we are able to display a few of the checks that we are getting for business and I want 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 customers verifying that the check is on the way I imply you understand if you simply begin to take a look at a few of these here I suggest this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I imply it’s simply I indicate think about the number of actual clients 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 validated and the check is on the mail in the mail from the IRS heading to the consumer so that’s how you’re able to track it you understand when you
get this you know the check is chosen sure and that’s when they pay so they do not pay anything up until they really receive the cash they do not pay bottom line Wonder trust anything till this letter is validated the check is on the way they transfer it into their savings account and they can genuinely rely on Wonder trust that the process has been completed and how many you believe you have actually processed because you began this we’re about 35 000 of these for
about six billion dollars wow so plainly they understand 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 among these that’s what matters all right Mr Wonderful here you’re at my YouTube channel we’re speaking about something really important today the employee retention credit which the majority of you have never heard of I certainly hadn’t heard of it until really just recently and discovered a lot about it due to the fact that this is probably the most affordable expense of capital for any small business anywhere
anytime if you have workers in between five and five hundred so I’ve got the specialist with me this is Josh Fox he’s the founder 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 just call up your bank manager and say provide me a loan it does not 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 become yes the Ambassador and paid representative for this I enjoy this program it’s disappearing soon you got to learn everything about it let’s talk staff member retention credit Josh Fox what is an ERC let’s just start there so throughout the Trump Administration when President Trump was enacted they developed the cares Act and the cares act offered organizations 3 chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly everybody it makes a big difference right there 2 of them are loans and one’s a refund precisely so the ERC is a refund that’s.
correct the money money payroll tax refund all right go on sorry I simply need to make sure we got that point I mean that’s a huge distinction a loan versus money cash I like money cash that’s what we’re discussing fine 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 lovely hard check in the mail where you get actual cash from the internal revenue service all right so let’s speak about how it works since it sounds like to me if it’s a if it’s employee retention credit that person had to be an employee so I’m going to make the Assumption this money is not for the owner not for individuals on the cap table not for shareholders it’s for staff members right you had to have owned a company but it’s based upon you having W-2 workers in America not 10.99. As long as you had W-2 workers 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 6 months of 2021 on the W-2 proper 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 two and 3 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 preferred part money 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 specific Kevin is 50 of the staff member’s income to an optimum of five thousand dollars per employee for the year of 2020 and in 2021 the numbers escalated to 70 of the employee’s income to an optimum of seven thousand per quarter how did that happen um they simply altered the rules in.
2021 versus due to the fact that the chaos 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 as much as five thousand Max and after that what occurs 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 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 have to be decreased from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan 2 you would reduce the 26 000 so what we’re seeing on average Kevin is if you took PPP money somewhere around 10 thousand dollars an individual so let’s say hypothetically you owned a restaurant in New York 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 internal revenue service so it’s big obviously now the huge question is why does nobody know about this since look when I first became aware of this when I initially fulfilled Josh you know I have actually got lots of investments in lots of business I’m a major advocate for entrepreneurship in America and make many lots of investments in business owners of which numerous suffered through the pandemic when I first found out 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 very easy to do we had our CEOs call the banks they got their loans and that were well should have and we used them sensibly to stay alive throughout 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 political leader pals Guv Senators they didn’t understand about it I suggest that’s how you know that’s how misinformation is that there’s no information out there then a lot of individuals told me well you can’t get it because you took the PPP likewise not true so let’s ask Josh why does nobody know about the worker retention credit you know what’s intriguing you’re speaking about the banks Kevin since in the PPP loan procedure the federal government made it really 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 process 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 turmoil due to the fact that remember in the initial cares act you could refrain from doing both programs so if you had done PPP you could refrain from doing ERC in the initial program and when they altered 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 ever made it clear to any person about how to.
do this does your CFO understand how to do this not truly he or she’s never ever 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 accountant’s never ever done this prior to unless you have an account that entered into this organization and bottom line my firm Kevin has been in business considering that 2009 and we have actually 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 big huge business clients have actually worked with bottom line to recover other government programs we’ve done sales tax and use tax joblessness tax work chance tax credits research and development tax credits unclaimed property real estate tax all of these other government programs.
The worker retention tax credit is a broad based refundable tax credit created to encourage.
companies to keep workers on their payroll. The credit is 50% of as much as $10,000 in wages paid by an.
company whose service is fully or partially suspended because of COVID-19 or whose gross receipts.
decrease by more than 50%.
1. The credit is offered to all employers regardless of size consisting of tax exempt organizations. There are.
only 2 exceptions: (1) state and city governments and their instrumentalities and (2) small.
businesses who take Small company Loans.
2. To qualify, the company needs to satisfy one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the company’s organization is totally or partially suspended by government order due to COVID-19.
during the calendar quarter or.
o the company’s gross receipts are below 50% of the comparable quarter in 2019. As soon as the.
employer’s gross receipts go above 80% of a similar quarter in 2019 they no longer qualify.
after completion of that quarter.
Estimation of the Credit.
The amount of the credit is 50% of the certifying wages paid up to $10,000 in total.
It works for earnings paid after March 13th and prior to December 31, 2020.
The meaning of qualifying salaries differs by whether an employer had, usually, basically than.
100 workers in 2019.
Business that focus on ERC filing support usually supply proficiency and assistance to assist services browse the complicated procedure of declaring the credit. They can offer different services, including:.
How is the employee retention credit calculated? Employee Retention Credit For Third Quarter 2021
Eligibility Evaluation: These business will evaluate your service’s eligibility for the ERC based upon factors such as your industry, income, and operations. They can assist identify if you meet the requirements for the credit and identify the optimum credit amount you can claim.
Paperwork and Calculation: ERC filing services will help in gathering the needed documentation, such as payroll records and monetary declarations, to support your claim. They will also help calculate the credit amount based upon qualified incomes and other certifying costs.
Retroactive Claim Evaluation: If you are qualified to claim the ERC for prior quarters, these companies can review your past payroll records and financials to determine prospective opportunities for retroactive credits. They can assist you change previous tax returns to claim these refunds.
Filing Support: Companies focusing on ERC filings will prepare and submit the needed kinds and paperwork on your behalf. This includes completing Form 941 or any other necessary tax return.
Compliance and Updates: ERC policies and guidance have progressed gradually. These business stay updated with the most recent modifications and guarantee that your filings adhere to the most current standards. They can also offer continuous assistance if the IRS requests additional info or carries out an audit related to your ERC claim.
It is very important to research study and vet any business using ERC filing support to guarantee their credibility and know-how. Look for established companies with experience in tax and payroll services, or consider reaching out to relied on accounting firms or tax experts who provide ERC filing assistance.
Remember that while these companies can supply valuable help, it’s always a great idea to have a fundamental understanding of the ERC requirements and process yourself. This will help you make informed decisions and ensure accurate filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit presented by the U.S. federal 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 actually been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is readily available to qualified companies, including for-profit services, tax-exempt companies, and certain governmental entities. To certify, companies must satisfy one of two criteria:.
Business operations were totally or partially suspended due to a government order related to COVID-19.
Business experienced a significant decline in gross invoices. As mentioned earlier, for 2021, a considerable 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 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 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 quantity is equal to a portion (approximately 70%) of qualified salaries paid to employees, including certain health plan costs. The maximum credit per worker is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: At first, companies that got an Income Protection Program (PPP) loan were not eligible 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 exact same earnings can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively broadened and boosted, enabling eligible companies to declare the credit for certified incomes paid as far back as March 13, 2020. This retroactive provision offers a chance for companies to modify prior-year tax returns and receive refunds.
Declaring the Credit: Companies can claim the ERC by reporting it on their employment income tax return, typically Kind 941. The excess can be reimbursed to the company if the credit exceeds the amount of employment taxes owed.
It is very important to note that the ERC provisions and eligibility criteria have actually developed in time. The best strategy is to seek advice from a tax expert or check out the official IRS website for the most updated and in-depth information concerning the ERC, including any recent legal modifications or updates.
To qualify for the ERC, a business should meet one of the following criteria:.
Business operations were fully or partly suspended due to a government order related to COVID-19.
The business experienced a significant decrease in gross invoices. For 2021, a significant decline is specified as a 20% decrease 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 exact same quarter in 2019, or a 20% decrease in gross receipts compared to the instantly preceding quarter.
The ERC is readily available to companies of all sizes, including tax-exempt organizations, but there are some exceptions. Government entities and companies that got a PPP loan may have restrictions on claiming the credit.
The process for declaring the ERC includes completing the essential types and consisting of the credit on your employment tax return (normally Form 941). The exact time it requires to process the credit can differ based upon a number of aspects, consisting of the intricacy of your service and the work of the IRS. It’s advised to talk to a tax expert for assistance particular to your circumstance.
There are numerous companies that can aid with the process of declaring the ERC. These include accounting firms, tax advisory services, and payroll company. Some well-known business that offer support with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young. It’s a good idea to research and contact these business directly to ask about their services and fees.
Please note that the info supplied here is based upon basic knowledge and may not show the most current updates or modifications to the ERC. It is necessary to speak with a tax professional or go to the main IRS site for the most precise and updated details concerning eligibility, declaring treatments, and available help.
Less than 100. The credit is based if the employer had 100 or fewer staff members on average in 2019.
on wages paid to all staff members whether they actually 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. If the employer had more than 100 workers usually in 2019, then the credit is.
permitted just for wages paid to employees who did not work throughout the calendar quarter.
In both cases, “wages” includes not simply cash payments however also a portion of the expense of employer.
offered health care. Employee Retention Credit For Third Quarter 2021
Employers can be immediately reimbursed for the credit by minimizing the amount of payroll taxes they.