Lets talk first about how to apply for employee retention credit in Thibodaux for Medical Equipment and Supplies Manufacturing …
Anytime if you have workers in between 5 and five hundred so I’ve got the professional with me this is Josh Fox he’s the founder and CEO of bottom line Principles they’re the biggest processor of these ERC credits this is a 170 page program so it’s hard this isn’t like PPP we simply call up your bank supervisor and say give 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’ve become yes the Ambassador and paid spokesperson for this I enjoy this program it’s disappearing very soon you got to find out everything about it let’s talk employee retention credit Josh Fox what is an ERC let’s simply begin there so throughout the Trump Administration when President Trump was enacted they came up with the cares Act and the cares act provided services three chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and practically everybody it makes a big distinction right there two of them are loans and one’s a refund precisely so the ERC is a refund that’s.
correct the money cash payroll tax refund fine go on sorry I simply have to ensure we got that point I suggest that’s a big distinction a loan versus money money I like cash cash that’s what we’re speaking about 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 tough check in the mail where you get actual money from the IRS all right so let’s talk about how it works due to the fact that it seems like to me if it’s a if it’s employee retention credit that person had to be a worker 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 had to have owned a business however it’s based on you having W-2 employees 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 qualified so you have to be on payroll in 2020 on the W-2 and you have to be on payroll for the first six months of 2021 on the W-2 correct so there were 6 quarters the program was open well walk us through the six quarters so you had quarters two three and 4 of 2020 and you had quarters one two and 3 of 2021. fine so that’s how it’s measured you have to be on the W-2 during that period now let’s talk my preferred part money just how much can you get back per staff member that was on a W-2 in those six quarters so the computation in 2020 to be exact Kevin is 50 of the staff member’s salary to a maximum of 5 thousand dollars per staff member for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the employee’s income to a maximum of 7 thousand per quarter how did that happen um they simply altered the rules in.
2021 versus because the chaos 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 approximately 5 thousand Max and after that what takes place 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 six thousand dollars per staff member that is since that’s a great deal of money 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 minimize the 26 000 so what we’re seeing on average Kevin is if you took PPP cash somewhere around ten 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 staff members and you took PPP money you would still get a million dollar in the mail from the IRS so it’s big clearly now the huge concern is why does no one learn about this since appearance when I first became aware of this when I first met Josh you understand I’ve got great deals of financial investments in great deals of business I’m a major advocate for entrepreneurship in America and make many numerous financial investments in entrepreneurs of which lots of suffered through the pandemic when I first found out about this I called BS I don’t believe 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 and that were well should have and we used them sensibly to survive throughout the pandemic so when I heard about this I said nah it can’t hold true however 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 understand that’s how false information is that there’s no details out there then a lot of people told me well you can’t get it since you took the PPP also not real so let’s ask Josh why does nobody understand 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 extremely 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 process in Canada a pre-pp loan there’s no loans in Canada by the way it’s simply process process that’s all um and here there was turmoil because keep in mind in the initial cares act you might refrain from doing both programs so if you had done PPP you might not do ERC in the initial 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 federal government never ever made it clear to anybody about how to.
do this does your CFO know how to do this not really 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 companies yeah some of them are doing it as a payroll business your accounting professional no your accountant’s never done this before unless you have an account that went into this service and bottom line my firm Kevin has actually been in business because 2009 and we’ve been dealing with the federal government and the state federal government to recover cash for Fortune 500 Fortune 1000 business so a lot of our huge huge business clients have actually dealt with bottom line to recuperate other federal government programs we’ve done sales tax and utilize tax unemployment tax work opportunity tax credits research and development tax credits unclaimed home property tax all of these other federal government programs.
The employee retention tax credit is a broad based refundable tax credit developed to motivate.
Are you Eligible for Thibodaux Medical Equipment and Supplies Manufacturing ERC Find out now
companies to keep workers on their payroll. The credit is 50% of approximately $10,000 in salaries paid by an.
company whose business is completely or partially suspended because of COVID-19 or whose gross receipts.
decrease by more than 50%.
Availability.
1. The credit is offered to all companies regardless of size consisting of tax exempt organizations. There are.
only two exceptions: (1) state and city governments and their instrumentalities and (2) small.
services who take Small Business Loans.
2. To qualify, the company needs to satisfy one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the company’s service is completely or partly suspended by federal government order due to COVID-19.
throughout the calendar quarter or.
o the company’s gross receipts are listed below 50% of the equivalent quarter in 2019. Once the.
employer’s gross receipts exceed 80% of a comparable quarter in 2019 they no longer qualify.
after the end of that quarter.
Calculation of the Credit.
The quantity of the credit is 50% of the qualifying wages paid up to $10,000 in overall.
It works for incomes paid after March 13th and before December 31, 2020.
The meaning of certifying wages differs by whether a company had, typically, more or less than.
100 staff members in 2019.
Business that specialize in ERC filing help typically supply know-how and assistance to assist services browse the intricate process of claiming the credit. They can use various services, including:.
How is the employee retention credit calculated? Is The Employee Retention Credit Still Available
Eligibility Assessment: These business will evaluate your company’s eligibility for the ERC based on factors such as your market, earnings, and operations. If you fulfill the requirements for the credit and determine the optimum credit quantity you can declare, they can assist determine.
Documents and Estimation: ERC filing services will help in collecting the needed documentation, such as payroll records and monetary declarations, to support your claim. They will also assist determine the credit amount based upon eligible earnings and other certifying costs.
Retroactive Claim Evaluation: If you are qualified to claim the ERC for prior quarters, these companies can examine your past payroll records and financials to recognize prospective opportunities for retroactive credits. They can help you modify previous tax returns to claim these refunds.
Filing Support: Companies focusing on ERC filings will prepare and submit the required forms and documents in your place. This consists of finishing Form 941 or any other required tax forms.
Compliance and Updates: ERC policies and assistance have progressed over time. These companies stay upgraded with the latest modifications and make sure that your filings adhere to the most existing standards. If the IRS requests additional information or carries out an audit related to your ERC claim, they can also offer ongoing support.
It is necessary to research and veterinarian any business providing ERC filing help to guarantee their reliability and knowledge. Try to find recognized firms with experience in tax and payroll services, or think about reaching out to trusted accounting companies or tax experts who offer ERC filing assistance.
Remember that while these business can supply valuable help, it’s always an excellent idea to have a basic understanding of the ERC requirements and procedure yourself. This will assist you make informed decisions and make sure precise filings.
The Employee Retention Credit (ERC) is a refundable tax credit presented by the U.S. government as part of COVID-19 relief steps. The goal of the ERC is to motivate businesses to maintain and pay their workers throughout 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, including for-profit organizations, tax-exempt organizations, and certain governmental entities. To qualify, employers must fulfill one of two requirements:.
Business operations were fully or partially suspended due to a federal government order related to COVID-19.
The business experienced a significant decline in gross receipts. As mentioned earlier, for 2021, a considerable decrease is defined as a 20% decrease in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a significant decrease is specified as a 20% decline in gross invoices compared to the 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 is equal to a percentage (as much as 70%) of qualified earnings paid to employees, including certain health insurance costs. The optimum credit per employee is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, services that got a Paycheck Defense Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 enables services to declare the ERC even if they received a PPP loan. The very same salaries can not be used to declare both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has actually 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 arrangement offers a chance for services to change prior-year tax returns and get refunds.
Declaring the Credit: Employers can declare the ERC by reporting it on their employment tax returns, usually Kind 941. If the credit surpasses the amount of employment taxes owed, the excess can be reimbursed to the employer.
It is essential to keep in mind that the ERC arrangements and eligibility requirements have actually evolved with time. The very best course of action is to consult with a tax expert or go to the official IRS site for the most in-depth and current details regarding the ERC, consisting of any current legal modifications or updates.
To qualify for the ERC, a business must satisfy among the following requirements:.
Business operations were completely or partly suspended due to a federal government order related to COVID-19.
Business experienced a substantial decline in gross receipts. For 2021, a significant decrease is specified as a 20% decline in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a substantial decrease is specified as a 20% decline in gross receipts compared to the very same quarter in 2019, or a 20% decrease in gross invoices compared to the immediately preceding quarter.
The ERC is available to businesses of all sizes, consisting of tax-exempt organizations, but there are some exceptions. For example, federal government entities and services that received a PPP loan may have constraints on claiming the credit.
The procedure for declaring the ERC involves completing the needed types and consisting of the credit on your employment income tax return (generally Kind 941). The exact time it requires to process the credit can vary based on several aspects, consisting of the complexity of your organization and the work of the internal revenue service. It’s suggested to talk to a tax professional for guidance specific to your circumstance.
There are several companies that can aid with the process of claiming the ERC. These include accounting firms, tax advisory services, and payroll service providers. Some well-known companies that use assistance with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s a good idea to research and contact these companies directly to inquire about their costs and services.