Lets talk first about Ppp Loans And Employee Retention Credit :
Our team here what do these men doing everyone in this room is helping teach individuals about ERC and uh always supply a gorgeous breakfast and have individuals actually discover the program we ought to 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 numerous countless dollars literally Kevin hundreds of millions of dollars so these are duplicate copies of the letters that go to customers verifying that the check is on the method I suggest you know if you just start to take a look at a few of these here I imply this one’s 8 million this one is 1.1 million 1.7 million 1.4 million I indicate it’s simply I imply consider how many real customers that went through the program yeah this is the very end this is the celebration 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 customer so that’s how you’re able to track it you understand when you
get this you know the check is opted for sure and that’s when they pay so they do not pay anything up until they really get the money they don’t pay bottom line Wonder trust anything up until this letter is confirmed the check is on the way they deposit it into their savings account and they can truly rely on Wonder trust that the procedure has actually been ended up and how many you think you’ve processed because you started this we have to do with 35 000 of these for
about 6 billion dollars wow so clearly 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 Terrific here you’re at my YouTube channel we’re talking about something really crucial today the employee retention credit which most of you have never become aware of I definitely had not heard of it until very just recently and discovered a lot about it since this is most likely the lowest expense of capital for any small company anywhere
anytime if you have employees in between five and five hundred so I have actually got the specialist with me this is Josh Fox he’s the founder and CEO of bottom line Ideas they’re the largest 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 supervisor and state give 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 have actually become yes the Ambassador and paid representative for this I love this program it’s going away very soon you got to learn 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 came up with the cares Act and the cares act used organizations 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 big distinction right there two of them are loans and one’s a refund exactly so the ERC is a refund that’s.
correct the cash money payroll tax refund all right go on sorry I just need to ensure we got that point I indicate that’s a big difference a loan versus money cash I like money cash 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 initial cares Act is the ERC and yes Kevin it is a beautiful hard check in the mail where you get actual money from the IRS all right so let’s speak about how it works due to the fact that it seems like to me if it’s a if it’s worker retention credit that person had to be a staff member so I’m going to make the Presumption this cash is not for the owner not for individuals on the cap table not for investors it’s for staff members right you needed to have actually owned a business however it’s based upon you having W-2 staff members in America not 10.99. so 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 need to be on payroll for the very first 6 months of 2021 on the W-2 appropriate so there were six quarters the program was open well walk 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. all right so that’s how it’s determined you need to be on the W-2 during that period now let’s talk my preferred part money how much can you get back per staff member that was on a W-2 in those 6 quarters so the computation in 2020 to be specific Kevin is 50 of the staff member’s wage to a maximum of five thousand dollars per staff member for the year of 2020 and in 2021 the numbers increased to 70 of the employee’s wage to a maximum of seven thousand per quarter how did that take place 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 employees on payroll 100 so if you can get 5 000 per person Max in twenty that was 50 in 2020 approximately five thousand Max and then what occurs 21 000 Max in 2021 oh that’s how you develop twenty 6 thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty 6 thousand dollars per staff member that is because that’s a lot of money it is now there’s a caution here the PPP money would have to be decreased from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan 2 you would minimize the 26 000 so what we’re seeing usually Kevin is if you took PPP money somewhere around 10 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 workers and you took PPP cash you would still get a million dollar in the mail from the internal revenue service so it’s substantial certainly now the huge question is why does nobody learn about this because appearance when I first heard about this when I first satisfied Josh you understand I have actually got great deals of financial investments in lots of business I’m a major supporter for entrepreneurship in America and make many lots of financial investments in entrepreneurs of which numerous suffered through the pandemic when I initially became aware of this I called BS I do not believe it since I utilize the PPP we went through the money 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 during the pandemic so when I found out about this I stated nah it can’t hold true however when I dug around I even contacted us to my politician buddies Guv Senators they didn’t know about it I imply that’s how you understand that’s how misinformation is that there’s no details out there then a bunch of individuals informed me well you can’t get it because you took the PPP also not real so let’s ask Josh why does nobody know about the employee retention credit you know what’s intriguing you’re discussing the banks Kevin due to the fact that in the PPP loan process 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 process that’s all um and here there was turmoil since remember in the initial cares act you could refrain from doing 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 not doing ERC due to the fact that 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 know how to do this not really she or he’s never done it before 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 accounting professional’s never ever done this prior to unless you have an account that went into this company and bottom line my firm Kevin has actually stayed in business given that 2009 and we have actually been dealing with the federal government and the state government to recover money for Fortune 500 Fortune 1000 business so a great deal of our big big corporate customers have worked with bottom line to recuperate other federal government programs we have actually done sales tax and use tax unemployment tax work opportunity tax credits research and development tax credits unclaimed home real estate tax all of these other government programs.
The worker retention tax credit is a broad based refundable tax credit created to motivate.
companies to keep staff members on their payroll. The credit is 50% of approximately $10,000 in earnings paid by an.
employer whose business is fully or partly suspended because of COVID-19 or whose gross invoices.
decline by more than 50%.
1. The credit is available to all companies despite size including tax exempt companies. There are.
just two exceptions: (1) state and city governments and their instrumentalities and (2) little.
services who take Small Business Loans.
2. To qualify, the company has to meet one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the company’s service is totally or partially suspended by government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross invoices are below 50% of the similar quarter in 2019. Once the.
company’s gross invoices exceed 80% of a comparable quarter in 2019 they no longer qualify.
after completion of that quarter.
Computation of the Credit.
The amount of the credit is 50% of the qualifying earnings paid up to $10,000 in total.
It is effective for earnings paid after March 13th and prior to December 31, 2020.
The definition of qualifying wages varies by whether a company had, typically, basically than.
100 staff members in 2019.
Business that specialize in ERC filing assistance typically supply proficiency and assistance to assist organizations browse the intricate procedure of claiming the credit. They can provide various services, consisting of:.
How is the employee retention credit calculated? Ppp Loans And Employee Retention Credit
Eligibility Assessment: These companies will assess your business’s eligibility for the ERC based upon aspects such as your market, revenue, and operations. They can help identify if you meet the requirements for the credit and recognize the maximum credit quantity you can declare.
Documents and Computation: ERC filing services will help in gathering the necessary documents, such as payroll records and financial declarations, to support your claim. They will likewise help determine the credit quantity based upon qualified wages and other certifying expenses.
Retroactive Claim Evaluation: If you are eligible to declare the ERC for prior quarters, these business can evaluate your previous payroll records and financials to determine possible chances for retroactive credits. They can help you change previous tax returns to claim these refunds.
Filing Help: Companies specializing in ERC filings will prepare and send the needed types and documentation on your behalf. This includes completing Form 941 or any other necessary tax return.
Compliance and Updates: ERC guidelines and assistance have developed in time. These business stay upgraded with the latest modifications and make sure that your filings adhere to the most existing guidelines. They can also supply ongoing assistance if the internal revenue service demands additional details or conducts an audit related to your ERC claim.
It is essential to research and vet any company offering ERC filing support to guarantee their reliability and knowledge. Search for established firms with experience in tax and payroll services, or consider reaching out to trusted accounting firms or tax specialists who provide ERC filing assistance.
Remember that while these companies can offer important help, it’s constantly an excellent concept to have a fundamental understanding of the ERC requirements and procedure yourself. This will assist you make notified choices and guarantee precise filings.
The Employee Retention Credit (ERC) is a refundable tax credit introduced by the U.S. federal government as part of COVID-19 relief steps. The objective of the ERC is to motivate companies to keep and pay their employees during the pandemic, even if their operations have actually been impacted.
Here are some key points about the ERC:.
Eligibility: The ERC is offered to eligible companies, including for-profit businesses, tax-exempt organizations, and specific governmental entities. To qualify, companies need to satisfy one of two requirements:.
The business operations were fully or partially suspended due to a federal government order related to COVID-19.
The business experienced a substantial decrease in gross receipts. As discussed earlier, 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 decline is specified as a 20% decrease in gross receipts compared to the exact same quarter in 2019, or a 20% decline in gross receipts compared to the instantly preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the employer’s share of Social Security taxes. The credit amount is equal to a percentage (approximately 70%) of certified salaries paid to employees, including certain health plan expenses. 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: Initially, companies that received an Income Defense Program (PPP) loan were not qualified for the ERC. However, legislation passed in late 2020 and extended in 2021 enables businesses to claim the ERC even if they got a PPP loan. However, the exact same incomes can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively broadened and boosted, enabling qualified employers to claim 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 receive refunds.
Claiming the Credit: Companies can claim the ERC by reporting it on their work income tax return, typically Type 941. If the credit goes beyond the amount of employment taxes owed, the excess can be reimbursed to the employer.
It’s important to note that the ERC provisions and eligibility requirements have actually evolved gradually. The best course of action is to speak with a tax professional or check out the main internal revenue service site for the most up-to-date and detailed information regarding the ERC, consisting of any current legislative modifications or updates.
To receive the ERC, an organization should meet among the following requirements:.
Business operations were fully or partially suspended due to a federal government order related to COVID-19.
The business experienced a significant decrease in gross invoices. 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 receipts 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 companies of all sizes, consisting of tax-exempt organizations, however there are some exceptions. For instance, federal government entities and organizations that received a PPP loan might have limitations on claiming the credit.
The procedure for claiming the ERC involves completing the necessary kinds and including the credit on your employment tax return (generally Form 941). The exact time it takes to process the credit can vary based on numerous factors, consisting of the intricacy of your organization and the workload of the IRS. It’s advised to speak with a tax expert for assistance specific to your circumstance.
There are several companies that can assist with the process of declaring the ERC. These consist of accounting companies, tax advisory services, and payroll service providers. Some widely known companies that offer assistance with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s suggested to research and contact these business directly to inquire about their services and charges.
Please keep in mind that the details offered here is based on basic understanding and might not reflect the most recent updates or changes to the ERC. It is necessary to seek advice from a tax expert or go to the official IRS website for the most up-to-date and precise information concerning eligibility, declaring treatments, and offered support.
Less than 100. If the employer had 100 or fewer workers usually in 2019, then the credit is based.
on wages paid to all workers 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 company had more than 100 employees on average in 2019, then the credit is.
enabled only for incomes paid to employees who did not work throughout the calendar quarter.
In both cases, “wages” includes not just money payments but likewise a part of the expense of employer.
offered healthcare. Ppp Loans And Employee Retention Credit
Employers can be right away repaid for the credit by minimizing the quantity of payroll taxes they.