Lets talk first about how to apply for employee retention credit in Keyser for Dry Pea and Bean Farming …
Anytime if you have employees 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 not easy this isn’t like PPP we just call your bank supervisor and say give me a loan it doesn’t work there’s not a loan it’s an application and Josh is going to tell us all about it and how to get it and why I have actually ended up being yes the Ambassador and paid spokesperson for this I like this program it’s disappearing very soon you got to learn everything about it let’s talk worker retention credit Josh Fox what is an ERC let’s simply start there so during the Trump Administration when President Trump was enacted they came up with the cares Act and the cares act used services three opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly everyone it makes a big difference right there two of them are loans and one’s a refund exactly so the ERC is a refund that’s.
correct the money money payroll tax refund alright go on sorry I just have to ensure we got that point I imply that’s a big difference a loan versus cash cash I like cash cash that’s what we’re discussing 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 beautiful difficult check in the mail where you get real cash from the internal revenue service all right so let’s talk about how it works since it seems like to me if it’s a if it’s worker retention credit that individual needed 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 shareholders it’s for employees right you needed to have owned a company but it’s based upon you having W-2 workers in America not 10.99. so as long as you had W-2 workers 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 need to be on payroll for the very first 6 months of 2021 on the W-2 correct so there were 6 quarters the program was open well stroll us through the 6 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 determined you need to be on the W-2 throughout that period now let’s talk my favorite part money how much can you return per worker that was on a W-2 in those six quarters so the estimation in 2020 to be specific Kevin is 50 of the employee’s salary 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 income to a maximum of 7 thousand per quarter how did that happen um they simply changed the rules in.
2021 versus due to the fact that the turmoil 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 happens 21 000 Max in 2021 oh that’s how you develop 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 since that’s a lot of cash it is now there’s a caveat here the PPP cash would have to be reduced from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan two you would decrease the 26 000 so what we’re seeing on average Kevin is if you took PPP cash somewhere around 10 thousand dollars a person so let’s state 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 cash you would still get a million dollar in the mail from the IRS so it’s huge certainly now the huge concern is why does nobody learn about this due to the fact that look when I first became aware of this when I initially fulfilled Josh you know I’ve got great deals of investments in great deals of companies I’m a significant advocate for entrepreneurship in America and make lots of numerous investments in entrepreneurs of which numerous suffered through the pandemic when I first heard about this I called BS I do not think it because I utilize 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 should have and we used them carefully to survive throughout the pandemic so when I found out about this I stated nah it can’t be true but when I dug around I even called to my political leader buddies Guv Senators they didn’t know about it I suggest that’s how you know that’s how misinformation is that there’s no details out there then a lot of people informed me well you can’t get it since you took the PPP also not true so let’s ask Josh why does nobody understand about the worker retention credit you know what’s interesting you’re speaking about the banks Kevin since in the PPP loan process the federal government made it very clear that if you wanted a PPP loan you would call Wells Fargo Citibank Bank of America any of the huge 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 procedure procedure that’s all um and here there was chaos because remember in the initial cares act you could 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 refraining from doing ERC since it’s not alone so you’re getting a tax refund so the federal government never ever made it clear to anyone about how to.
do this does your CFO understand how to do this not really she or he’s never ever done it previously do the banks do it nope the banks do not do it the payroll companies yeah some of them are doing it as a payroll company your accounting professional no your accountant’s never done this before unless you have an account that went into this organization and bottom line my company Kevin has actually been in business since 2009 and we’ve been dealing with the federal government and the state government to recover cash for Fortune 500 Fortune 1000 business so a great deal of our big huge business customers have dealt with bottom line to recover other government programs we have actually done sales tax and utilize tax joblessness tax work opportunity tax credits research and development tax credits unclaimed home real estate tax all of these other federal government programs.
The staff member retention tax credit is a broad based refundable tax credit developed to encourage.
Are you Eligible for Keyser Dry Pea and Bean Farming ERC Find out now
companies to keep workers on their payroll. The credit is 50% of approximately $10,000 in earnings paid by an.
company whose business is fully or partly suspended because of COVID-19 or whose gross invoices.
decrease by more than 50%.
1. The credit is offered to all employers despite size including tax exempt organizations. There are.
only 2 exceptions: (1) state and city governments and their instrumentalities and (2) little.
businesses who take Small Business Loans.
2. To qualify, the employer needs to fulfill one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the employer’s service is totally or partially suspended by government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross receipts are below 50% of the similar quarter in 2019. As soon as the.
employer’s gross receipts go above 80% of an equivalent quarter in 2019 they no longer certify.
after completion of that quarter.
Computation of the Credit.
The quantity of the credit is 50% of the qualifying earnings paid up to $10,000 in overall.
It works for salaries paid after March 13th and prior to December 31, 2020.
The meaning of certifying incomes varies by whether an employer had, on average, more or less than.
100 staff members in 2019.
Companies that specialize in ERC filing assistance usually supply competence and support to help services navigate the complicated procedure of claiming the credit. They can provide numerous services, consisting of:.
How is the employee retention credit calculated? How To Use The Employee Retention Credit
Eligibility Assessment: These business will evaluate your service’s eligibility for the ERC based upon aspects such as your market, profits, and operations. They can assist figure out if you fulfill the requirements for the credit and determine the maximum credit amount you can declare.
Paperwork and Estimation: ERC filing services will help in collecting the required paperwork, such as payroll records and monetary declarations, to support your claim. They will likewise assist calculate the credit amount based on eligible salaries and other certifying costs.
Retroactive Claim Review: If you are qualified to claim the ERC for previous quarters, these companies can evaluate your previous payroll records and financials to identify potential opportunities for retroactive credits. They can help you amend previous income tax return to claim these refunds.
Filing Help: Business focusing on ERC filings will prepare and submit the essential forms and paperwork on your behalf. This includes finishing Form 941 or any other necessary tax return.
Compliance and Updates: ERC guidelines and assistance have actually evolved in time. These companies stay updated with the current modifications and guarantee that your filings abide by the most current guidelines. They can also provide ongoing support if the IRS demands additional info or carries out an audit related to your ERC claim.
It is essential to research study and vet any company using ERC filing help to ensure their trustworthiness and expertise. Try to find recognized companies with experience in tax and payroll services, or think about connecting to trusted accounting firms or tax experts who use ERC filing support.
Remember that while these business can supply valuable help, it’s always a good idea to have a basic understanding of the ERC requirements and procedure yourself. This will help you make informed choices and ensure precise filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit introduced by the U.S. government as part of COVID-19 relief steps. The goal of the ERC is to encourage services to maintain and pay their workers throughout the pandemic, even if their operations have actually been impacted.
Here are some key points about the ERC:.
Eligibility: The ERC is offered to qualified employers, including for-profit services, tax-exempt organizations, and certain governmental entities. To qualify, employers must meet one of two requirements:.
Business operations were fully or partially suspended due to a federal government order related to COVID-19.
Business experienced a significant decrease in gross receipts. As discussed previously, for 2021, a significant decrease is specified as a 20% decline in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a significant decline is specified as a 20% decline 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 employer’s share of Social Security taxes. The credit quantity is equal to a percentage (up to 70%) of certified earnings paid to staff members, including certain health plan expenditures. The optimum credit per worker is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: At first, services that got a Paycheck Defense Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 permits companies to claim the ERC even if they received a PPP loan. Nevertheless, the same earnings can not be utilized to claim both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has actually been retroactively expanded and enhanced, allowing eligible employers to declare the credit for certified earnings paid as far back as March 13, 2020. This retroactive provision provides an opportunity for organizations to amend prior-year income tax return and get refunds.
Declaring the Credit: Companies can declare the ERC by reporting it on their work tax returns, normally Kind 941. If the credit surpasses the quantity of work taxes owed, the excess can be refunded to the employer.
It is necessary to note that the ERC provisions and eligibility criteria have progressed with time. The best strategy is to seek advice from a tax expert or check out the main IRS site for the most detailed and up-to-date information regarding the ERC, consisting of any current legal changes or updates.
To receive the ERC, a company should meet among the following requirements:.
The business operations were totally or partially suspended due to a federal government order related to COVID-19.
Business experienced a considerable decline in gross receipts. For 2021, a considerable decline is specified as a 20% decline in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a significant decrease is defined as a 20% decrease in gross receipts compared to the same quarter in 2019, or a 20% decrease in gross receipts compared to the instantly preceding quarter.
The ERC is offered to businesses of all sizes, including tax-exempt companies, but there are some exceptions. Government entities and services that got a PPP loan might have limitations on declaring the credit.
The procedure for declaring the ERC involves completing the required forms and including the credit on your employment tax return (typically Form 941). The exact time it takes to process the credit can differ based upon a number of factors, consisting of the intricacy of your organization and the work of the IRS. It’s advised to speak with a tax expert for assistance specific to your situation.
There are numerous business that can aid with the process of claiming the ERC. These consist of accounting companies, tax advisory services, and payroll service providers. Some popular companies that use help with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s a good idea to research study and contact these companies straight to ask about their charges and services.