Lets talk first about how to apply for employee retention credit in Wilmington for Petroleum and Coal Products Manufacturing …
Anytime if you have staff members between five 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 largest processor of these ERC credits this is a 170 page program so it’s challenging this isn’t like PPP we just call your bank manager and say offer 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 like this program it’s disappearing very soon you got to discover everything about it let’s talk employee retention credit Josh Fox what is an ERC let’s simply start there so throughout the Trump Administration when President Trump was enacted they created the cares Act and the cares act provided companies 3 opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and almost 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.
fix the money cash payroll tax refund okay go on sorry I just need to make sure we got that point I suggest that’s a big distinction a loan versus money money I like money cash 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 gorgeous tough check in the mail where you get actual cash from the internal revenue service all right so let’s speak about how it works because it seems like to me if it’s a if it’s employee 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 investors it’s for employees right you had to have 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 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 first 6 months of 2021 on the W-2 proper so there were six quarters the program was open well walk us through the 6 quarters so you had quarters 2 3 and 4 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 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 estimation in 2020 to be precise Kevin is 50 of the staff member’s wage to an optimum of 5 thousand dollars per employee for the year of 2020 and in 2021 the numbers increased to 70 of the worker’s wage to a maximum of seven thousand per quarter how did that occur um they simply altered the rules in.
2021 versus since the mayhem 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 then what occurs 21 000 Max in 2021 oh that’s how you create twenty 6 thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty six thousand dollars per employee that is since that’s a great deal of cash it is now there’s a caution here the PPP money would need to be lowered from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan 2 you would lower the 26 000 so what we’re seeing on average Kevin is if you took PPP money someplace around ten thousand dollars an individual so let’s state hypothetically you owned a dining establishment in New York 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 internal revenue service so it’s huge certainly now the big concern is why does no one know about this since appearance when I first found out about this when I first met Josh you understand I have actually got lots of financial investments in great deals of business I’m a significant advocate for entrepreneurship in America and make numerous lots of financial investments in entrepreneurs of which many 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 which were well been worthy of and we used them wisely to stay alive throughout the pandemic so when I became aware of this I said nah it can’t hold true but when I dug around I even called to my political leader pals Governor Senators they didn’t know about it I suggest that’s how you understand that’s how false information is that there’s no info out there then a lot of people informed me well you can’t get it because you took the PPP also not true so let’s ask Josh why does nobody learn about the staff member retention credit you know what’s interesting you’re speaking about the banks Kevin since in the PPP loan procedure the federal government made it very 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 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 mayhem because keep in mind in the original cares act you could not do both programs so if you had actually done PPP you could not do ERC in the original 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 made it clear to anybody about how to.
do this does your CFO understand how to do this not actually she or he’s never 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 business your accounting professional no your accountant’s never done this before unless you have an account that entered into this business and bottom line my firm Kevin has been in business because 2009 and we have actually been working with the federal government and the state federal government to recover money for Fortune 500 Fortune 1000 business so a lot of our big huge business clients have dealt 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 home real estate tax all of these other federal government programs.
The worker retention tax credit is a broad based refundable tax credit created to motivate.
Are you Eligible for Wilmington Petroleum and Coal Products Manufacturing ERC Find out now
companies to keep employees on their payroll. The credit is 50% of approximately $10,000 in wages paid by an.
Because of COVID-19 or whose gross receipts, company whose organization is completely or partly suspended.
decline by more than 50%.
1. The credit is readily available to all companies regardless of size consisting of tax exempt companies. There are.
just 2 exceptions: (1) state and local governments and their instrumentalities and (2) little.
businesses 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 partially suspended by federal government order due to COVID-19.
during the calendar quarter or.
o the employer’s gross invoices are below 50% of the similar quarter in 2019. As soon as the.
employer’s gross invoices go above 80% of an equivalent 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 wages paid after March 13th and before December 31, 2020.
The meaning of qualifying salaries varies by whether a company had, typically, basically than.
100 employees in 2019.
Companies that concentrate on ERC filing assistance normally supply proficiency and assistance to assist companies browse the complicated procedure of claiming the credit. They can provide numerous services, including:.
How is the employee retention credit calculated? What Are Qualified Wages For Employee Retention Credit
Eligibility Evaluation: These business will evaluate your organization’s eligibility for the ERC based upon elements such as your industry, revenue, and operations. If you fulfill the requirements for the credit and determine the optimum credit amount you can claim, they can assist identify.
Documentation and Calculation: ERC filing services will help in collecting the required documentation, such as payroll records and financial statements, to support your claim. They will also assist determine the credit quantity based on eligible salaries and other certifying costs.
Retroactive Claim Review: If you are qualified to claim the ERC for previous quarters, these business can evaluate your previous payroll records and financials to recognize potential chances for retroactive credits. They can help you amend previous income tax return to declare these refunds.
Filing Support: Companies concentrating on ERC filings will prepare and submit the essential types and paperwork on your behalf. This includes finishing Kind 941 or any other necessary tax return.
Compliance and Updates: ERC policies and guidance have progressed gradually. These business stay upgraded with the most recent changes and make sure that your filings comply with the most present standards. If the Internal revenue service requests additional information or conducts an audit associated to your ERC claim, they can also offer ongoing support.
It is very important to research and vet any business providing ERC filing assistance to guarantee their reliability and proficiency. Try to find recognized firms with experience in tax and payroll services, or consider reaching out to relied on accounting firms or tax specialists who use ERC filing assistance.
Keep in mind that while these business can provide valuable support, it’s constantly a great idea to have a basic understanding of the ERC requirements and procedure yourself. This will assist you make informed decisions and guarantee accurate filings.
The Employee 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 motivate companies to retain and pay their employees during the pandemic, even if their operations have been impacted.
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 certain governmental entities. To qualify, employers should meet one of two criteria:.
Business operations were fully or partly suspended due to a government order related to COVID-19.
Business experienced a considerable decline in gross invoices. As discussed earlier, for 2021, a substantial decline is defined as a 20% decrease in gross receipts compared to the exact same quarter in 2019. For 2022 and beyond, a significant decline is defined as a 20% decrease in gross receipts compared to the same quarter in 2019, or a 20% decline in gross invoices compared to the right away preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the employer’s share of Social Security taxes. The credit quantity amounts to a percentage (approximately 70%) of qualified wages paid to staff members, consisting of specific health insurance costs. The optimum credit per worker is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, companies that received a Paycheck Protection Program (PPP) loan were not qualified for the ERC. Nevertheless, legislation passed in late 2020 and extended in 2021 permits organizations to claim the ERC even if they received a PPP loan. The same earnings can not be utilized to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively expanded and enhanced, permitting eligible companies to claim the credit for qualified wages paid as far back as March 13, 2020. This retroactive provision provides a chance for organizations to modify prior-year income tax return and get refunds.
Claiming the Credit: Employers can claim the ERC by reporting it on their employment income tax return, normally Form 941. If the credit exceeds 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 developed over time. The best course of action is to talk to a tax expert or check out the official IRS site for the most updated and in-depth info concerning the ERC, including any recent legislative changes or updates.
To receive the ERC, a business must meet one of the following criteria:.
The business operations were fully or partly suspended due to a federal government order related to COVID-19.
Business experienced a significant decrease in gross receipts. For 2021, a considerable decrease is defined as a 20% decrease in gross receipts compared to the very 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% decrease in gross receipts compared to the instantly preceding quarter.
The ERC is available to businesses of all sizes, including tax-exempt companies, however there are some exceptions. Government entities and companies that received a PPP loan may have restrictions on declaring the credit.
The procedure for declaring the ERC includes completing the required kinds and consisting of the credit on your employment income tax return (usually Form 941). The exact time it requires to process the credit can vary based upon numerous elements, including the complexity of your business and the work of the IRS. It’s recommended to consult with a tax professional for assistance particular to your situation.
There are several companies that can assist with the process of declaring the ERC. Some well-known business that provide help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.