Lets talk first about how to apply for employee retention credit in Alameda for Utilities …
Anytime if you have staff members in between five and five hundred so I’ve got the professional with me this is Josh Fox he’s the creator and CEO of bottom line Concepts they’re the biggest 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 state offer me a loan it doesn’t work there’s not a loan it’s an application and Josh is going to tell all of us about it and how to get it and why I’ve become yes the Ambassador and paid representative for this I love this program it’s going away soon you got to learn all about it let’s talk staff member retention credit Josh Fox what is an ERC let’s just start there so during the Trump Administration when President Trump was enacted they developed the cares Act and the cares act used businesses three 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 difference right there two of them are loans and one’s a refund precisely so the ERC is a refund that’s.
remedy the cash money payroll tax refund all right go on sorry I just need to make sure we got that point I suggest that’s a huge difference a loan versus cash money I like cash money 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 stunning hard check in the mail where you get real cash from the internal revenue service all right so let’s discuss how it works since it sounds like to me if it’s a if it’s worker retention credit that person needed to be a staff member so I’m going to make the Assumption this money is not for the owner not for people on the cap table not for investors it’s for employees right you needed to have owned a service 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 qualified 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 right so there were six quarters the program was open well stroll us through the six 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 measured you need to be on the W-2 throughout that period now let’s talk my preferred part cash just how much can you return per employee that was on a W-2 in those 6 quarters so the calculation in 2020 to be specific Kevin is 50 of the employee’s salary to an optimum of five thousand dollars per worker for the year of 2020 and in 2021 the numbers increased to 70 of the staff member’s salary to a maximum of seven thousand per quarter how did that happen um they just altered the rules in.
2021 versus because 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 as much as five thousand Max and then 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 six thousand dollars per worker that is since that’s a lot of cash it is now there’s a caveat here the PPP money would need to be decreased from the twenty six thousand dollars so if you took PPP loan one and PPP loan two you would reduce 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 City where I’m from and you had a hundred employees and you took PPP money you would still get a million dollar in the mail from the IRS so it’s big obviously now the big question is why does nobody know about this due to the fact that look when I first heard about this when I first fulfilled Josh you know I have actually got great deals of investments in lots of companies I’m a major advocate for entrepreneurship in America and make numerous numerous investments in entrepreneurs of which many suffered through the pandemic when I first became aware of this I called BS I don’t believe it due to the fact that I use the PPP we went through the cash center Banks to get it it was extremely easy to do we had our CEOs call the banks they got their loans which were well been worthy of and we used them carefully to survive throughout the pandemic so when I became aware of this I said nah it can’t hold true however when I dug around I even called to my political leader pals Governor Senators they didn’t know about it I imply that’s how you know that’s how false information is that there’s no details out there then a bunch of people told me well you can’t get it due to the fact that you took the PPP likewise not true so let’s ask Josh why does nobody know about the employee retention credit you know what’s interesting you’re talking about 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 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 mayhem due to the fact that keep in mind in the initial cares act you might refrain from doing both programs so if you had actually done PPP you could refrain from doing ERC in the original program and when they changed 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 made it clear to any person about how to.
do this does your CFO know how to do this not really he or she’s never ever done it previously do the banks do it nope the banks don’t do it the payroll companies yeah a few of them are doing it as a payroll company your accounting professional no your accounting professional’s never done this before unless you have an account that went into this company and bottom line my firm Kevin has stayed in business because 2009 and we’ve been dealing with the federal government and the state government to recover money for Fortune 500 Fortune 1000 companies so a lot of our big big business clients have dealt with bottom line to recover other federal government programs we have actually 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 government programs.
The worker retention tax credit is a broad based refundable tax credit designed to motivate.
Are you Eligible for Alameda Utilities ERC Find out now
employers to keep employees on their payroll. The credit is 50% of up to $10,000 in salaries paid by an.
Due to the fact that of COVID-19 or whose gross invoices, company whose service is totally or partially suspended.
decrease by more than 50%.
1. The credit is readily available to all companies despite size including tax exempt companies. There are.
just 2 exceptions: (1) state and local governments and their instrumentalities and (2) little.
companies who take Small company Loans.
2. To certify, the employer needs to satisfy one of two alternative tests. The tests are computed each.
calendar quarter– Either.
o the employer’s company is completely or partly suspended by government order due to COVID-19.
during the calendar quarter or.
o the employer’s gross receipts are below 50% of the comparable quarter in 2019. When the.
company’s gross receipts go above 80% of an equivalent quarter in 2019 they no longer qualify.
after completion of that quarter.
Calculation of the Credit.
The quantity of the credit is 50% of the qualifying salaries 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 certifying earnings differs by whether a company had, typically, basically than.
100 workers in 2019.
Business that concentrate on ERC filing assistance typically supply competence and support to assist organizations navigate the complex process of claiming the credit. They can offer various services, including:.
How is the employee retention credit calculated? Non Refundable Portion Of Employee Retention Credit Form Worksheet 1
Eligibility Evaluation: These business will examine your service’s eligibility for the ERC based upon elements such as your market, revenue, and operations. They can help determine if you meet the requirements for the credit and determine the optimum credit quantity you can declare.
Documents and Calculation: ERC filing services will help in collecting the required documentation, such as payroll records and financial declarations, to support your claim. They will also assist calculate the credit quantity based on qualified salaries and other qualifying expenses.
Retroactive Claim Review: If you are eligible to declare the ERC for previous quarters, these companies can examine your past payroll records and financials to determine possible chances for retroactive credits. They can help you amend previous income tax return to claim these refunds.
Filing Support: Business concentrating on ERC filings will prepare and send the needed types and documentation on your behalf. This includes completing Type 941 or any other required tax return.
Compliance and Updates: ERC policies and guidance have developed with time. These companies remain updated with the current modifications and make sure that your filings comply with the most existing guidelines. If the Internal revenue service demands additional details or carries out an audit associated to your ERC claim, they can also offer continuous assistance.
It’s important to research and veterinarian any company using ERC filing assistance to ensure their credibility and expertise. Look for recognized firms with experience in tax and payroll services, or think about connecting to relied on accounting firms or tax professionals who use ERC submitting support.
Remember that while these business can offer important help, it’s always a great concept to have a standard understanding of the ERC requirements and process yourself. This will assist you make informed decisions and guarantee precise filings.
The Worker 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 encourage companies to retain and pay their employees throughout the pandemic, even if their operations have been affected.
Here are some key points about the ERC:.
Eligibility: The ERC is available to qualified companies, consisting of for-profit organizations, tax-exempt organizations, and certain governmental entities. To qualify, employers should meet one of two requirements:.
The business operations were fully or partially suspended due to a government order related to COVID-19.
Business experienced a considerable decline in gross receipts. As pointed out earlier, for 2021, a significant decline is specified as a 20% decline in gross invoices 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 immediately preceding quarter.
Credit Amount: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit amount amounts to a portion (approximately 70%) of certified earnings paid to employees, including certain health insurance expenditures. The maximum credit per employee is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: At first, businesses that received an Income Security Program (PPP) loan were not eligible for the ERC. Legislation passed in late 2020 and extended in 2021 enables organizations to declare the ERC even if they received a PPP loan. The same incomes can not be utilized to declare both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has been retroactively broadened and enhanced, permitting eligible companies to declare the credit for qualified incomes paid as far back as March 13, 2020. This retroactive provision supplies an opportunity for organizations to modify prior-year income tax return and get refunds.
Declaring the Credit: Companies can claim the ERC by reporting it on their employment tax returns, typically Form 941. The excess can be refunded to the employer if the credit goes beyond the quantity of employment taxes owed.
It is very important to keep in mind that the ERC arrangements and eligibility criteria have developed gradually. The very best course of action is to talk to a tax expert or check out the official internal revenue service site for the most in-depth and updated info relating to the ERC, consisting of any current legal changes or updates.
To qualify for the ERC, a business needs to fulfill one of the following criteria:.
Business operations were fully or partly suspended due to a government order related to COVID-19.
Business experienced a significant decline in gross receipts. For 2021, a significant decline is specified as a 20% decline in gross receipts compared to the very same quarter in 2019. For 2022 and beyond, a significant decline is specified as a 20% decrease in gross receipts compared to the exact same quarter in 2019, or a 20% decline in gross invoices compared to the instantly preceding quarter.
The ERC is available to businesses of all sizes, including tax-exempt organizations, however there are some exceptions. For example, government entities and businesses that received a PPP loan may have restrictions on claiming the credit.
The process for claiming the ERC involves completing the essential types and consisting of the credit on your work tax return (typically Type 941). The exact time it takes to process the credit can vary based upon numerous elements, consisting of the intricacy of your service and the work of the internal revenue service. It’s advised to talk to a tax professional for guidance particular to your situation.
There are a number of companies that can help with the process of declaring the ERC. Some widely known companies that use help with ERC claims consist of ADP, Paychex, Deloitte, and Ernst & Young.